Secret shoppers and security lapses in state liquor audit

Posted at 4:46 PM, Sep 24, 2013

SALT LAKE CITY -- An audit of Utah's liquor agency raised concerns about the security of thousands of dollars in liquor destined for stores statewide.

The preliminary results of the audit, presented by Utah State Auditor John Dougall to the Department of Alcoholic Beverage Control Commission on Tuesday, uncovered potential problems with financial security in liquor stores and at a distribution yard the state contracts with.

"Because of these two issues, we thought they were significant enough, we wanted to bring it to management's attention right away," he said.

The audit was ordered by the Utah State Legislature in the aftermath of a series of scandals that led to major changes in DABC management. Auditors examined the DABC's practices from the inside-out, focusing on liquor stores and distribution from the agency's massive warehouse.

Auditors went undercover into liquor stores to buy alcohol and watch workers handle cash, request ID and test their security measures.

"Because the DABC takes in over a quarter of receipts by cash, we think that cash skimming is a risk," said Rebekka Wilkinson, a senior auditor.

Auditors noted they found no evidence any DABC employees were pocketing cash, but as a result of the security lapse all customers will get a receipt for their transaction.

More seriously, Wilkinson said, was problems uncovered at a carrier yard the state contracts with. Alcohol is taken from the DABC warehouse to the Superior Service Transport yard where it is then shipped out to liquor stores across the state. Wilkinson said auditors pulled up and walked into the unfenced yard.

"Nobody stopped us or asked us why we were there, what we were doing," she told the DABC Commission.

Auditors found three semis sitting in the yard, unsecured. They opened the trucks up and found tens of thousands of dollars in liquor -- just sitting there.

As a result of the security lapse, DABC executive director Sal Petilos said policies have already changed: padlocks are now on all semis carrying DABC merchandise. Superior Service Transport said it has already made other improvements to security.

The audit is only preliminary -- more results are expected in November, when Dougall's office wraps up its probe. DABC Commission Chairman David Gladwell told FOX 13 the audit is an effort to be more transparent in the aftermath of "past problems."

"It may be very validating in November," he said. "We may find out we're doing a pretty good job. To the extent we're not doing a very good job, we want to address those promptly."