In South Carolina, the fallout from a $1.8 billion accounting error cost the job of the state auditor, while the state treasurer is vowing to push forward with a promise of transparency.
An independent audit released earlier this month found that $1.8 billion in funds thought to be in a bank account never existed, with $1.6 billion of that total being the “result of incorrect journal entries,” while the remaining $200 million was “already included in the reported bank balances of the” state treasurer’s office. As lawmakers have expressed their outrage over the accounting error, State Auditor George Kennedy announced his resignation Thursday.
“It has been both an honor and a privilege to serve the State of South Carolina during the past nine years,” Kennedy said in the letter, according to WIS-TV. “However, I believe it is in the best interest of the Office of the State Auditor that I resign from my position as State Auditor effective today.”
Kennedy served as state auditor since 2015 and became the most recent state official to resign in recent years after problems with the state books. Richard Eckstrom resigned as state comptroller general in 2023 following a multibillion-dollar accounting error in a financial report.
South Carolina Treasurer Curtis Loftis has faced calls to resign or be impeached over the latest accounting error, but in a piece written for the Post and Courier, he said the error was a larger matter than just his office.
“The $1.8 billion conversion entry was a shared responsibility among several agencies, not an isolated failure of the state treasurer’s office. The comptroller general (as the state’s accountant), the state auditor and the state’s outside audit firm were all aware of the entry. From the moment concerns arose, my team acted swiftly and within legal parameters to address them,” Loftis wrote. “To suggest otherwise ignores the collaborative nature of state financial oversight and unfairly assigns blame for systemic issues.”
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He also defended his record as treasurer and said the state’s “financial resources are secure and produce strong returns.”
“The people of South Carolina deserve a state treasurer who puts their interests first — someone who is not afraid to face challenges head-on and advocate for reforms that benefit everyone. I stand by my record and will continue to serve with integrity and accountability,” Loftis wrote.