The Valencia public sector audit sees high risks in the Palau de Congresos, which has already suffered two major frauds in the last four years: almost 200,000 euros in 2024 and 21,000 euros in 2020. The municipal auditor’s report focuses on the management of the public building and highlights that in practically all its areas there are high risks of fraud, embezzlement or manipulation and prepares a battery of recommendations to improve accounting and treasury controls.
The document, prepared by the City Hall’s legal services, assesses that in 2025 new software will be launched to keep accounts and record invoices, a system which, according to management, “integrates automatic control and traceability mechanisms that allow the entire invoicing process to be verified at any time, from receipt of the document to its final payment”. However, in the 2024 analysis, he notes numerous alerts in the ordinary management of the entity, which he links to the lack of control of procedures. For example, the treasury functions fall to a technician, who replaces the financial director, on sick leave, a situation which implies that “there is no adequate separation of functions, which increases the risk of fraud or error”.
Among the risks detected by the Intervention, at the level of expenditure, it highlights: “There is no link between orders and the procurement files to which they correspond, so that orders can be placed without verifying that the corresponding expenditure has been previously approved (i.e. without a contract) or if the approved amount has been exceeded (award amount). » “We have not obtained proof that the technical staff who approve the invoices monitor those associated with each contract, in order to verify that the award amount is not exceeded before making the payment,” continues the report, which also highlights that there are payments by card and without supporting documents. “Certain payments are made using six prepaid cards, five of which are allocated to the staff of the commercial sector and one to the director of the financial administration sector. We have selected seven arrangements made with debit from the cards, without the Entity, in six of them, having provided proof of the expense which proves its realization,” he emphasizes.
The entity’s situation during 2024 and part of 2025 is atypical and management admits some errors. In the statement of allegations, the manager emphasizes that in the last twelve months – although the audit refers to the year 2024 – they have operated in complex circumstances. Three of the four area directors – legal, financial and infrastructure – were on leave, “resulting in a considerable reduction in management and supervisory capacity”, in addition to two other employees of the 22 they have. Added to this is the fact that they left the external consultancy, “which left the organization without an accounting, tax and labor service for several months”, which they had to cover with a minor contract and did not have “a service in adequate conditions until the end of July 2024”. In September of the same year, the Conference Center was the victim of a fraud of 200,000 euros.
The entity also defends that this year it has strengthened security with the hiring of a new advisor. This is, as elDiario.es has already reported, the company Dula Auditores, whose administrator is the son of a former Zaplana municipal councilor and which was initially excluded from the process because it did not have a certificate of anti-fraud measures. The public tender was void and this requirement was removed in the new one. The director of the Conference Center underlines in the press release of allegations: “In accordance with the recommendations of the audit, since the second half of 2025, the verification of accounting entries has been reinforced by a monthly cross-verification, carried out jointly by administrative staff and the external consulting firm Dula Auditores SLP, which acts as a second level of control and guarantees the integrity of the archives. »
The recommendations of the intervention report are substantial. To mitigate the risks of “fraud, accounting manipulation and traceability”, specifies the letter, “the accounting recording of invoices must take place after verification of their conformity by the person responsible for the expenditure”. Among the controls established on payments, “it should be included that the IT system blocks payments whose invoiced amount differs or exceeds that established in specifications and contracts.” It also requires that “either duplicate payments or those that have not been previously authorized” be avoided or that “prepaid cards be invariably linked to their justification” and “monitor bank reconciliations on a monthly, not annual, basis.”
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