South Carolina's $1.8 billion error sparks call for removal

South Carolina's $1.8 billion public accounting error has spurred widespread controversy, uncovering systemic flaws in state financial management. Investigations revealed most of the missing funds never existed, attributing the error to incorrect journal entries during an accounting system transition. Resignations of key officials, including the former comptroller general and state auditor, underscore the gravity of the situation, while Treasurer Curtis Loftis, facing criticism for his handling of the issue, remains defiant.

Legislative measures now include hiring a financial compliance officer to oversee financial offices and avoid future errors. With federal investigations ongoing, the state's financial reporting faces challenges that risk its credit rating and overall fiscal reputation.

The summary above was drafted with the help of AI tools and edited by journalists in our News division. All stories below were reported, written and edited by McClatchy journalists.

S.C. Treasurer Curtis Loftis on Tuesday, April 2, 2024 during a Finance Constitutional Subcommittee meeting concerning $1.8 billion that has been discovered in an account. (Travis Bell/STATEHOUSE CAROLINA)

NO. 1: LOFTIS ‘ABROGATED HIS RESPONSIBILITIES’ AS TREASURER, SC SENATOR SAYS OVER $1.8B ACCOUNT

State Treasurer Curtis Loftis testified for about six hours during a combative hearing in front of a state Senate Finance panel. | Published April 3, 2024 | Read Full Story by Joseph Bustos

South Carolina Comptroller General Brian Gaines and Treasurer Curtis Loftis.

NO. 2: MOST OF SC’S MYSTERIOUS $1.8 BILLION NEVER EXISTED, ACCORDING TO AN INDEPENDENT AUDITOR

SC Treasurer Curtis Loftis defended his office ahead of the report’s release, saying the money existed and has always been accounted for. Did the auditors place the blame on his office? | Published January 15, 2025 | Read Full Story by Joseph Bustos

Susan Markel, a partner and managing director, and Dave Bligh, the director of investigations, of AlixPartners, testify in front of the South Carolina state Senate Finance Committee on Tuesday, Jan. 21, 2025 about the firm’s report over the state’s finances including the mysterious $1.8 billion. By Joseph Bustos

NO. 3: WITH SC’S FINANCES UNDER SEC INVESTIGATION, LAWMAKERS SEEK FINANCIAL ‘BABYSITTER’

An outside forensic auditing firm recommended the state hire a third-party compliance officer after determining most of a mysterious $1.8 billion listing was not real money. | Published January 22, 2025 | Read Full Story by Joseph Bustos

South Carolina State Auditor George Kennedy III and outside independent auditor Remi Omisore, a principal at CliftonLarsonAllen, speak to a Senate Finance subcommittee about the comptroller general’s office $3.5 billion financial reporting error. By Joseph Bustos

NO. 4: SC’S STATE AUDITOR RESIGNS FROM JOB AMID CONTROVERSY OVER STATE’S $1.8B ACCOUNTING ERROR

Kennedy has been South Carolina’s state auditor since October 2015. | Published January 23, 2025 | Read Full Story by Joseph Bustos

South Carolina Treasurer Curtis Loftis testifies in front of House Ways and Means subcommittee Wednesday, Jan. 29, 2025 about a $1.8 billion accounting error. By Travis Bell/Statehouse Carolina

NO. 5: SC TREASURER LOFTIS VOWS TO STAY IN OFFICE, AFTER AUDITOR RESIGNS AMID $1.8 BILLION ERROR

“We can’t allow a treasurer to be pushed out because of other people’s failures” South Carolina Treasurer Loftis told a House Ways and Means panel. | Published January 29, 2025 | Read Full Story by Joseph Bustos

S.C. Treasurer Curtis Loftis during a Constitutional House Ways and Means Subcommittee Meeting in Columbia, S.C. on Wednesday, Jan. 29, 2025. (Travis Bell/STATEHOUSE CAROLINA)

NO. 6: SC HOUSE GOP STOPS SHORT OF CALLING ON LOFTIS TO LEAVE AFTER $1.8B ERROR. HERE’S WHY

Treasurer Curtis Loftis has vowed to finish his term despite calls to resign from members of state Senate. | Published February 3, 2025 | Read Full Story by Joseph Bustos

Clarissa Adams, the chief of staff at the South Carolina Treasurer’s Office, testifies in front of a state Senate Finance panel on Tuesday, Feb. 18, 2025, about a forensic audit into a $1.8 billion accounting error. By Travis Bell/Statehouse Carolina

NO. 7: SC TREASURER’S OFFICE PAID FOR CRISIS COMMUNICATIONS HELP AMID $1.8B ACCOUNTING ERROR

The SC treasurer’s office also also hired a subject matter expert to help with understanding the annual comprehensive financial report. | Published February 19, 2025 | Read Full Story by Joseph Bustos

Scenes at the South Carolina statehouse on Wednesday, April 26, 2023 in Columbia, S.C. (Travis Bell/STATEHOUSE CAROLINA)

NO. 8: SC MADE BILLION-DOLLAR ACCOUNTING ERRORS. HERE’S HOW MUCH IT’S COSTING IN ATTORNEY FEES

Lawyers are being paid to represent SC’s Comptroller General, Auditor and Treasurer’s offices amid an SEC investigation. | Published March 3, 2025 | Read Full Story by Joseph Bustos

NO. 9: AFTER $1.8B ACCOUNTING ERROR, SC LOOKS TO CHANGE INDEPENDENT AUDITOR

The former comptroller-general and South Carolina auditor have each resigned in recent years after financial reporting issues. | Published April 7, 2025 | Read Full Story by Joseph Bustos

South Carolina Treasurer Curtis Loftis and treasurer’s office attorney Shawn Eubanks prepare to answer questions from a Senate Finance Committee panel on Thursday, Feb. 27, 2025. By Tracy Glantz

NO. 10: AFTER SAYING HE WOULDN’T RUN IN 2026, SC TREASURER LOFTIS LAUNCHES REELECTION BID

The embattled and defiant Curtis Loftis, a Republican, has criticized a South Carolina Senate investigation into a $1.8 billion accounting error, saying it has unfairly targeted him. Loftis has ignored calls for him to resign. | Published April 2, 2025 | Read Full Story by Joseph Bustos

South Carolina treasurer Curtis Loftis answers questions from a senate sub-committee on Thursday, Feb. 27, 2025. By Tracy Glantz

NO. 11: HEARING DATE SET ON WHETHER TO OUST SC TREASURER AFTER $1.8B ACCOUNTING ERROR. WHAT TO KNOW

Over the last two years, senators have investigated a $1.8 billion accounting error and found the treasurer, comptroller-general and state auditor’s offices all were aware of the accounting issue. Only Treasurer Curtis Loftis remains in office. | Published April 2, 2025 | Read Full Story by Joseph Bustos

This report was produced with the help of AI tools, which summarized previous stories reported and written by McClatchy journalists. It was edited by journalists in our News division.