Councilman Suspected Foul Play in City Department

MEMPHIS, Tenn. - Evidence of fraud, city employee suspensions, and an FBI investigation revealed apparent corruption at city hall. The investigation was brought to the forefront Friday as Mayor A C Wharton vowed to rebuild a troubled city department.

It's the General Services Department for the City of Memphis. The department purchases and maintains the city's fleet of vehicles. Now it's wide open for corruption and fraud.

Something long time City Councilman Myron Lowrey had suspected.

"There have been rumors throughout city government about mismanagement in general services, but no one could actually prove anything, or put their hands on anything," said Lowrey.

But Memphis Mayor A C Wharton got his hands on an internal audit into the General Services Department.

In a news conference Friday, Wharton said he requested the audit four months ago, to look into allegations of fraud involving the city's fleet services and contractor around town, Tire and Trucking. The probe turned up falsified invoices and numerous contractual infractions.

Wharton said the FBI is doing an investigation of its own.

"That's why they're the FBI. You never know what they're looking at. But, the only thing we have been put on notice of is, that they have an interest in, is the General Services," said Wharton.

Two employees have been put on administrative leave and former City Chief Administrative Officer Rick Masson has been hired on as a consultant to help.

"My focus is to stabilize the situation and then provide him with a road map. It's all about accountability. There's a lack of accountability," said Mason.

"Rick Masson brings credibility to our city government. He's been there for many years, he's completely honest and trustworthy and he has credibility," said Wharton.

The investigation into the department continues, and Wharton said eventually could lead to criminal charges.

"I think the mismanagement that's coming out today (Friday) is a reflection of the previous administration under Doctor Herenton," said Lowrey.

Another department manager resigned after a DUI arrest last month.