Loftis ‘abrogated his responsibilities’ as treasurer, SC senator says over $1.8B account
A panel of state senators investigating why $1.8 billion is sitting in a bank account said the state treasurer has lost control of the treasury.
In a combative hearing Tuesday, state Treasurer Curtis Loftis defended himself for six hours over the existence of a $1.8 billion account.
Whether it leads to a similar fate the previous comptroller general faced last year remains to be seen.
“I didn’t sit on anything,” Loftis said after being accused of not sharing information about the account.
But at the end of the contentious hearing, state Sen. Larry Grooms, R-Berkeley, who is leading the panel, said the General Assembly can’t rely on Loftis to resolve the issues around his office that have come to light during the senate investigation.
“These actions lead to misrepresentations of the financial condition of the state thereby misleading the General Assembly, the people of South Carolina and others that rely on the state’s financial statement,” Grooms said. “Mr. Loftis has abrogated his responsibilities. The state treasurer breached the public trust.”
Loftis repeatedly said the previous comptroller general and auditors knew about the $1.8 billion account, but senators focused in on why Loftis didn’t alert lawmakers sooner.
New Comptroller General Brian Gaines alerted lawmakers of the issue.
While speaking to reporters after the hearing, Grooms said the state’s investment portfolio was down nearly $1 billion, and the treasurer was selling investments at a loss.
At one point in the hearing, state Sen. Stephen Goldfinch, R-Dorchester, asked Loftis if he had pressured the state auditor into changing a draft report that showed the state’s general fund had a negative fund balance.
“I am not going to stand here and be accused of breaking the law,” a defensive Loftis said. “I’m being accused of breaking a law that I don’t think even exists and that there’s no evidence for and there’s an audit firm that you can call and ask.”
Grooms said the committee had been in touch with the auditor, who indicated it was a bad situation.
“I believe that there was influence,” Grooms said. “I believe that there was undue influence placed on the auditor to make an adjustment to show that the general fund balance was zero when the draft report said it was (negative) $456 million.”
During Tuesday’s hearing, Grooms asked why nearly $31 billion of state money that is listed incorrectly in the state ledger hasn’t been reconciled since the state changed accounting systems in 2017.
“He lost control in 2016 and has not made any efforts to try to correct it and he’s trying to blame shift,” Grooms said in an interview.
Loftis denied the amount was as high as $31 billion and contended the amount was really $1.8 billion. At one point he walked over to reporters to show them a document with a $1.8 billion total.
Loftis, a Republican, was reelected in 2022 to a fourth term with nearly 80% of the vote. The Democratic Party did not run a candidate against him. His only challenger on the ballot was from the Alliance Party.
The treasurer said Tuesday that this term would be his last.
Last year after the disclosure the comptroller general’s office had inflated the state’s cash position by $3.5 billion, previous Comptroller General Richard Eckstrom resigned. The general assembly indicated it was preparing to oust him.
Whether Loftis will see a similar fate remains to be seen. Grooms said the investigation will continue and others may be called to testify.
“There’s there’s still some things hanging out there the subcommittee and our staff was looking into,” Grooms said.
This story was originally published April 3, 2024 at 5:30 AM.
