Rhode Island 2023 Regular Session

Rhode Island House Bill H5444 Compare Versions

Only one version of the bill is available at this time.

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5	5	2023 -- H 5444
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7	7	LC001299
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9	9	S TATE OF RHODE IS LAND
10	10	IN GENERAL ASSEMBLY
11	11	JANUARY SESSION, A.D. 2023
12	12	____________
13	13
14	14	A N A C T
15	15	RELATING TO PUBLIC FINANCE -- THE OFFICE OF INTERNAL AUDIT
16	16	Introduced By: Representatives Noret, Casimiro, Hull, Casey, Baginski, Corvese,
17	17	O'Brien, Phillips, Dawson, and Finkelman
18	18	Date Introduced: February 08, 2023
19	19	Referred To: House Judiciary
20	20	(Dept. of Administration)
21	21
22	22	It is enacted by the General Assembly as follows:
23	23	SECTION 1. Chapter 35-7.1 of the General Laws entitled "The Office of Internal Audit" 1
24	24	is hereby amended by adding thereto the following sections: 2
25	25	35-7.1-6.1. Inspection of records and papers -- Investigations -- Subpoenas. 3
26	26	(a) The chief of the office of internal audit, in carrying out the duties outlined in this 4
27	27	chapter, shall have access to all records, reports, audits, reviews, papers, books, documents, 5
28	28	recommendations, correspondence, including information related to the purchase of service or 6
29	29	anticipated purchase of services from any agent, contractor or vendor by any public body as defined 7
30	30	in § 35-7.1-1(e), and any other data and material that is maintained by or available to any public 8
31	31	body, regardless of the media in which it is maintained, that is in any way related to the programs 9
32	32	and operations with respect to the State of Rhode Island, including any local town, municipality or 10
33	33	city. 11
34	34	(b) The chief may request information and records, cooperation and assistance from any 12
35	35	state, or local governmental agency as may be necessary for carrying out the chief's duties and 13
36	36	responsibilities. Upon receipt of such request, each person in charge of the public body shall furnish 14
37	37	to the chief, or agent or representative authorized by the chief, within ten (10) business days of 15
38	38	receipt of the chief’s request, such information and records, cooperation and assistance, including 16
39	39	information related to the purchase of services or anticipated purchase of services from any 17
40	40	contractor or vendor by any public body. If the public body is unable to comply with the request 18
41	41	for records and/or information within ten (10) business days, the person in charge of the public 19
42	42
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45	45	body must notify the chief in writing, prior to the expiration of the ten (10) business days, the reason 1
46	46	or reasons why the request cannot be fulfilled within this time and whether additional time is 2
47	47	necessary. 3
48	48	(c) The chief may initiate and conduct audits, investigations, and compliance reviews and 4
49	49	shall prepare detailed reports relating to findings, conclusions, and recommendations concerning 5
50	50	the administration of programs or operations, and internal controls over processes of public bodies. 6
51	51	Audits will be determined in accordance with a risk-based evaluation; other activities are in the 7
52	52	judgment of the chief, with guidance from the statewide audit advisory committee and the approval 8
53	53	of the director of management and budget. 9
54	54	(d) The chief shall have direct and prompt access to the head of any public body when 10
55	55	necessary for any purpose pertaining to the performance of the chief's duties and responsibilities 11
56	56	under this chapter. 12
57	57	(e) The chief may request the production, on a voluntary basis, of testimony or documents 13
58	58	from any firm or nongovernmental entity which relate to actions or matter that pertain to state, 14
59	59	municipal or local governmental agencies as dictated by his/her duties and responsibilities. 15
60	60	(f)(1) The director of administration, at the written request of the chief, may compel the 16
61	61	production of any records, reports, audits, reviews, papers, books, documents, recommendations, 17
62	62	correspondence and any other data or material, regardless of its form, relevant to any matter under 18
63	63	audit or investigation, pursuant to the provisions of this chapter, by issuing a subpoena duces tecum 19
64	64	signed by the director. Any entity or its agents acting in their official capacity who disobey any 20
65	65	such subpoena shall be considered in contempt of the department, and the department may proceed 21
66	66	in superior court to enforce compliance. 22
67	67	(2) A subpoena may be issued only when a corporation, other entity, or its agents acting 23
68	68	on their behalf, under investigation or being audited refuses to comply voluntarily with a request 24
69	69	from the chief. 25
70	70	(3) Such subpoena shall be served in the same manner as a subpoena for the production of 26
71	71	documents in a civil case issued on behalf of the State of Rhode Island, and all provisions of law 27
72	72	related to said subpoena shall apply to a subpoena issued pursuant to this chapter. Any justice of 28
73	73	the superior court may, upon application by the office of internal audit, issue an order to compel 29
74	74	the production of records, reports, audits, reviews, papers, books, documents, recommendations, 30
75	75	correspondence and any other data and material previously requested by the director of 31
76	76	administration. Any failure to obey such order may be punished by the superior court as a contempt 32
77	77	of court. 33
78	78	(4) The terms of any such subpoena must be reasonable and focused on specific evidence 34
79	79
80	80
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82	82	sought and must directly relate to the matters under investigation. A subpoena issued that is broad 1
83	83	in nature is not considered valid. No subpoena may be issued for purposes of harassment or for any 2
84	84	illegitimate or improper purpose. All constitutional and statutory rights and privileges that exist 3
85	85	with respect to any subpoena issued by the director of administration, including the privilege 4
86	86	against self-incrimination, shall continue to have the same force and effect. 5
87	87	(5) An entity, or agents acting on its behalf, may object to a subpoena served upon the 6
88	88	entity, or agents in advance of the return date of the subpoena by a motion to quash filed in the 7
89	89	superior court of the State of Rhode Island. The filing of a motion to quash shall stay the pending 8
90	90	subpoena until further order of the superior court. 9
91	91	(6) Any subpoena issued pursuant to this section, shall not be made public, nor shall any 10
92	92	documents or records provided pursuant to this section to the office be made public until such time 11
93	93	as it is necessary for the chief to do so in the performance of the chief's official duties and in 12
94	94	consideration of the exemptions provided by the Rhode Island access to public records act, chapter 13
95	95	2 of title 38 ("access to public records"). The production of such documents or records pursuant to 14
96	96	subpoena shall be governed by the same provisions with reference to secrecy that govern the 15
97	97	proceedings of a grand jury. Disclosure of such production, attendance, and testimony may be made 16
98	98	to such members of the staff of the office of internal audit as deemed necessary in the performance 17
99	99	of the chief’s duties and responsibilities under this chapter, and such members of the staff may be 18
100	100	present at the production of records. 19
101	101	35-7.1-6.2. Subpoena for witness testimony and for release of material evidence. 20
102	102	(a) Whenever the chief has reason to believe that an entity, or its agents acting on the 21
103	103	entity’s behalf, have information or evidence with respect to any matter that is within the chief’s 22
104	104	jurisdiction to investigate, the chief may request a subpoena for the attendance and testimony under 23
105	105	oath of any authorized agent of the entity as designated; provided, however, that such subpoena 24
106	106	may be issued only in the performance of official duties relating to the detection of fraud, waste, 25
107	107	abuse or mismanagement. The director of administration, upon written request by the chief, is 26
108	108	hereby authorized and empowered to summon witnesses to attend and testify on matters. A 27
109	109	subpoena for testimony or specific items needed in support of an investigation shall include the 28
110	110	name and address of the prospective witness(es) and/or a list of the specific items needed for the 29
111	111	investigation, and the reasons for requesting such subpoena. 30
112	112	(b) The subpoena shall be served in a similar manner to a subpoena served in a civil case 31
113	113	in the superior court of Rhode Island. Once the subpoena is served, the serving officer shall annotate 32
114	114	the time and date served, the person served and the location of service. 33
115	115	(c) A witness required by subpoena to attend and testify under oath and/or produce books 34
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119	119	and records or other items as demanded, shall be given not less than forty-eight (48) hours advance 1
120	120	notice of the time and place for the taking of testimony or delivery of subpoenaed items, unless 2
121	121	such notice shall unduly interfere with the conduct of the investigation. Such witness, at the time 3
122	122	of service of a subpoena, shall be notified of the matter under investigation and whether the person 4
123	123	is a subject of the investigation. A “subject of an investigation” is a person who is reasonably 5
124	124	suspected of committing or being party to an offense in their capacity as an agent for an entity 6
125	125	under investigation. The failure to furnish such witness with any notice or information required to 7
126	126	be given by this section shall cause the issued subpoena to be invalid. 8
127	127	(d) The terms of any such subpoena must be reasonable and focused on the specific 9
128	128	testimony or evidence sought and must directly relate to the matters under investigation. A 10
129	129	subpoena issued that is broad in nature shall not be considered valid. No subpoena may be issued 11
130	130	for purposes of harassment or for any illegitimate or improper purpose. All constitutional and 12
131	131	statutory rights and privileges that exist with respect to any subpoena issued by the director of 13
132	132	administration, including the privilege against self-incrimination, shall continue to have the same 14
133	133	force and effect. 15
134	134	(e) A witness representing an entity in their official capacity who is subpoenaed to testify 16
135	135	shall appear and testify under oath at the time and place designated on the subpoena. In addition, 17
136	136	the witness shall be notified that as a witness a right to consult with and to have an attorney present 18
137	137	exists at the time the testimony is taken, and that the witness has a constitutional right not to furnish 19
138	138	or produce evidence that may tend to be incriminating. 20
139	139	(f) A witness representing an entity may object to the subpoena served upon them in 21
140	140	advance of the return date of the subpoena by a motion to quash filed in the superior court of the 22
141	141	State of Rhode Island. The filing of a motion to quash shall stay the pending subpoena until further 23
142	142	order of the superior court. Any justice of the superior court may, upon application by the chief, 24
143	143	issue an order to compel the attendance of witnesses subpoenaed as foresaid and the giving of 25
144	144	testimony under oath in furtherance of any audit or investigation under this chapter. Failure to obey 26
145	145	an order of the court with respect to a subpoena may be punished by said court as contempt. 27
146	146	(g) Any subpoena issued pursuant to this section shall not be made public and the same 28
147	147	provisions with reference to secrecy, which govern grand jury proceedings, shall govern testimony 29
148	148	given. Whoever violates the provisions of this subsection shall be punished by imprisonment for 30
149	149	not more than six (6) months in a jail or house of correction or by a fine of not more than one 31
150	150	thousand dollars ($1,000). Disclosure of such testimony may be made to such members of the staff 32
151	151	of the office of internal audit as deemed necessary by the chief to assist in the performance of the 33
152	152	office’s duties and responsibilities, and such members of the staff may be present at the taking of 34
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156	156	such testimony. 1
157	157	SECTION 2. This act shall take effect upon passage. 2
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159	159	LC001299
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164	164	EXPLANATION
165	165	BY THE LEGISLATIVE COUNCIL
166	166	OF
167	167	A N A C T
168	168	RELATING TO PUBLIC FINANCE -- THE OFFICE OF INTERNAL AUDIT
169	169	***
170	170	This act would provide that the chief of the office of internal audit, when carrying out 1
171	171	official duties, shall have access to certain records relating to the purchase of services from vendors 2
172	172	or contractors by public bodies and would further provide the chief with the authority to initiate 3
173	173	audits, investigations and compliance reviews and would provide for a subpoena process for 4
174	174	witness testimony and material evidence upon the chief's request. 5
175	175	This act would take effect upon passage. 6
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177	177	LC001299
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