Forensic audit ordered on workers’ comp program under Ald. Ed Burke

Mayor Rahm Emanuel on Sunday announced plans to hire an outside firm to conduct a forensic audit of the workers’ compensation program that Ald. Ed Burke ran with carte blanche control for years until he resigned his post as chairman of the Finance Committee last week after he was accused by federal prosecutors of attempted extortion.

“We have a unique opportunity to hit the reset button on workers’ compensation,” Emanuel said in a statement. “To achieve a fresh start, we need to know what we’re dealing with so we get it right, which is why I’ve directed my administration to engage an outside firm to conduct a forensic audit.”

Control of the $100 million a year program is being transferred out of the hands of the City Council Finance Committee, where Burke operated it, and into the hands of the Department of Finance, which is run by a mayoral appointee.

One important difference: the wall that Burke built exempting the workers’ comp program from the investigatory purview of the city inspector general’s office will disappear.

Though Emanuel embraced transferring control of the program last week, he refused to mess with the order of things earlier this month when a group of progressive alderman introduced legislation to pry control of the program from Burke’s hands.

The forensic audit was proposed by Inspector General Joe Ferguson late last week. Choosing a firm to conduct the audit will be done jointly by Emanuel’s office, Ferguson and Ald. Pat O’Connor, the vice chairman who replaced Burke as chair of the Finance Committee.

The goal will be to gather preliminary findings and use the information it produces to guide any changes before keys to the workers’ comp program are handed to whomever is sworn in as the city’s new mayor this spring.

The scope of the audit “will include an evaluation of the program’s practices and resource management as well as identify any potential waste, fraud or abuse. We hope to have an interim report within 60 days of the selection of an independent, third-party firm,” Emanuel said in the statement.

And should the audit find illegal dealings, the information will be passed along to the U.S. Attorney’s office, Ferguson said when reached Sunday evening.

Summary results of the audit will be made public, Ferguson said, adding that redactions would be made only to protect medical records or any possible investigation that might stem from the findings.

“We requested, and the other parties agreed, that there will be public reporting to the extent that’s permitted by the law or prudence in relation to any possible investigation that may be suggested by the audit,” Ferguson said.

Political observers were quick to point out that the move by Emanuel to initiate an audit is not an exhibition of political backbone — if anything, it’s a case of better-late-than-never.

Emanuel could have launched an audit on the troubled program a long time ago, but, fearing Burke’s ability to throw a wrench in his legislative agenda, only took action after the extortion allegations rendered Burke weakened and politically toxic.

Emanuel also sat on the sidelines during attempts by Ferguson to investigate the program.

The political equation changed Thursday when federal prosecutors unsealed a criminal complaint alleging Burke attempted to extort business for his tax appeal firm from Burger King executives who were seeking construction permits on a restaurant in his ward.

The following day Burke proclaimed he was innocent of the federal charge. He also resigned as Finance Committee chair.

The workers’ comp program was not part of the criminal complaint against Burke.

But the program and its clout-heavy beneficiaries have raised eyebrows and generated headlines in the past.

In 2006, a Sun-Times investigation exposed such abuses as allowing patronage workers to file for injury claims at a higher rate than any occupation tracked by the Labor Department — including the most dangerous ones — and paying workers’ comp benefits to people who held outside jobs. The highest rates of injury coincided with the names of people who had the most clout.

Three years earlier, the Sun-Times ran a series of similar stories, including one about the city forking over $136,036 to a Streets and Sanitation worker who beat up his daughter’s boyfriend while out on disability for an injured hand.

In 2016, whistleblowers again called the workers’ comp program a cesspool of patronage and favoritism. Still, Burke persuaded his City Council colleagues to block Ferguson from auditing the program.

In a lawsuit filed in July, Jay Stone, a son of former Ald. Bernie Stone, accused Burke of exploiting the workers’ comp program to award jobs to precinct workers who deliver votes for his handpicked candidates. Stone also accused Burke of cutting disability checks as favors to political pals, such as to a precinct captain of a fellow alderman.

Burke, 75, has represented the 14th Ward since 1969, making him the longest-serving alderman in Chicago history. He’s seeking re-election in February from what’s now a majority-Hispanic ward and is facing four challengers, all of them Hispanic.