Comptroller reports adverse opinion on the operations of fund transfers to nonprofit entities at the Department of Recreation and Sports
San Juan, Puerto Rico (July 29, 2026) — The Comptroller of Puerto Rico, CPA and Attorney Carmen Vega Fournier, reported today the results of a compliance audit of the Department of Recreation and Sports (DRD) that reflects an adverse opinion on the tests performed and the objectives examined. The audited period was from January 1, 2020 to April 30, 2025.
For fiscal years 2020-21 through 2023-24, the Department of the Treasury deposited $12 million to the DRD in the Special Fund for the Development of Minor Categories (DCM Fund), of which it awarded $6,700,993 to eight organizations. The auditors found that the DRD contracted the same nonprofit organizations each year under Act 258-2006 without requiring proposals from them to encourage competition for the procurement of better services, and without including clauses that are required in the contracts.
The audit notes that the president of an entity contracted by the DRD was appointed on a transitory basis as a Sports and Recreation specialist. Subsequently, the term of that entity’s contract was extended on two occasions, which could constitute an apparent conflict of interest. As a result, the situation was referred to the Office of Government Ethics of Puerto Rico for the corresponding evaluation.
The Report also notes deficiencies in the contracting process for the lease of real property, without including evidence of having carried out a competitive or bidding process to seek the best alternative. It likewise notes deficiencies in the contracting for the placement of a billboard for $630,000. In addition, the DRD did not use 75% of the $180,000 available for advertising placements for 2022 and 2023.
In addition, the auditors detected regulations that had not been updated in more than 20 years, which affects oversight of the use of funds by nonprofit entities.
The Comptroller recommended that the Secretary and the officials of the DRD ensure full compliance with the applicable laws and regulations and promote the effective and efficient use of government resources for the benefit of our People. Audit Report OC-27-09 is available at www.ocpr.gov.pr.
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