PIERRE — The legislative committee tasked with oversight of state government is planning a deep dive into how a former employee with the Department of Social Services (DSS) allegedly stole nearly $1.8 million.
But first, it wants to give the criminal probe on the matter time to play out.
The South Dakota Legislature’s Government Operations and Audit Committee (GOAC) met for the first time Wednesday since Attorney General Marty Jackley announced two felony charges against Lonna Carroll, a former low-level employee accused of embezzling the funds while working at DSS.
Committee Chair Rep. Ernie Otten says that his committee is aiming to devote a full day in October to studying how Carroll managed to pull off the scheme over the span of three different governor administrations and to “understanding fully what happened.”
“GOAC has every right to examine this case,” Otten said during his opening remarks. “However, we need to make sure that our actions in no way impact the ability of the state to prosecute this case — or muddy the jury pool, or even impact the departments.”
The Tea Republican says that he would also like to see a full forensic audit conducted, as well as an exploration of what safeguards have since been adopted to prevent future instances of fraud in state government. That, Otten said, will come through testimony from staff at DSS, the Attorney General’s Office, the State Auditor’s Office and any other state departments involved in processing these payments or investigating them.
Other lawmakers added that they would like to see former staff from relevant departments appear before the committee, or the state’s internal controls board. Created in 2016 through legislation spearheaded by the Daugaard Administration, the internal controls board is supposed to monitor conflict of interest policies, departments’ internal control systems, and post audits.
“We need to take a look not just for this incident, but broadly over all the processes… We need to understand what may need to be changed overall,” said Brookings Sen. Tim Reed. “We are focusing on the who, but I want to make sure we get to the hows and whys as well.”
⌊ South Dakota Lawmakers Want Answers In DSS Embezzlement Case ⌋
Carroll made her initial appearance in the Hughes County courthouse last week after being extradited from an Iowa jail near her home. She was given conditions for her bond release should she come up with $50,000 to post for bond. The restrictions included gambling, drinking alcohol and smoking. Her next appearance is set for Aug. 27. Those restrictions are not uncommon for defendants who are released on bail and awaiting trial.
An investigation into Carroll by The Dakota Scout found that she was regarded as a hoarder who constantly bought items. Her Pierre apartment was the destination for Internet purchases, and the apartment was so full that workers couldn’t access it when remodeling. The investigation also revealed that Carroll disappeared for long stretches, presumably on vacation.
If the allegations against Carroll are found to be true, it will have been at least the third major scandal involving public employees and thefts of state resources going back to 2014. The other two incidences – the EB-5 and GEAR UP scandals – also both appeared before GOAC.
The latest incident involving Carroll has lawmakers across the political spectrum wondering if it is time adopt reforms aimed at curtailing corruption in state government during the 2025 legislative session — an idea endorsed by Jackley during a press conference on the topic last week.
“We will come up with a solution for this,” Otten concluded.
