Illinois Treasurer Dan Rutherford’s office exercised “inadequate controls” over a controversial summer internship program that cost taxpayers at least $328,000 in just two of the four years it operated, a critical state audit found.

The 2013 audit looked at deficiencies in a program that the Sun-Times examined last month, finding that some of the biggest power players in the state, including elected officials, lobbyists, one-time political workers and donors, helped steer paid positions to dozens of students.

The audit, conducted by Auditor General William Holland’s office, found that the treasurer’s office in 2012 hired 51 interns but failed to produce any applications for the individuals. 

“According to the treasurer’s office, interns were referred to Human Resources by constituents of the Illinois Treasurer,” the audit states.

Through a documents request, the Sun-Times has found that those “constituents” were made up largely of elected officials and other clout-heavy individuals. Rutherford’s office maintained a clout list where the names of interns were presented beside the names of state reps, aldermen, lobbyists and political donors. 

“The office had no formal written policies and procedures regarding the recruitment and management of interns or performance monitoring mechanisms within the internship program,” the audit indicated. 

Rutherford’s office has insisted that clout played no role in arranging the internships. However, the number of positions swelled under Rutherford, raising questions about the program. Treasurer Alexi Giannoulias, Rutherford’s predecessor, had eight interns the last year he was in office. By comparison, Rutherford hired 58 interns in 2013, the same year the Republican launched a primary bid for governor. Throughout his bid, which was ultimately unsuccessful, Rutherford maintained that he held the line on employee raises and operating costs in his office.

However, the audit found the office failed to exercise “an effective system of internal control” over a program that appeared to dole out paid spots to the sons and daughters of connected individuals. 

In one case, the Sun-Times found that a 16-year-old heir to the billionaire Pritzker family was among those given an internship, despite the position being intended for college-age students. A year earlier, a direct relative to that Pritzker intern contributed $50,000 to Rutherford. A Rutherford spokeswoman has said there was no connection between the Pritzker internship and the campaign contribution, and she noted that the individual worked in the office for just six weeks that summer. 

Rutherford’s office has said in an interview with the Sun-Times that each year it sent letters to Chicago aldermen and members of the Illinois General Assembly soliciting referrals for the internship program. Rutherford’s office said internships were posted on the Illinois treasurer’s website. However, the audit reported that applications were not available on the website until 2013. 

“Eleven of 11 (100%) interns tested did not have proper documentation that they met specific job qualifications as no specific job descriptions, qualifications or hiring practices were defined,” the audit said. 

Rutherford’s office defended its practice of soliciting sitting politicians for internship referrals and denied that the spreadsheets amounted to a “clout list.”