The Washington Apple Commission was overbilled by a contractor in India more than $500,000, according to a state investigation first reported by The Wenatchee World newspaper.
The contractor, SCS Group of New Delhi, was hired to promote apple sales in India, Bangladesh and Sri Lanka. Staff members at the Apple Commission received a tip from a subcontractor that SCS had billed the commission for $573,182 more than its subcontractors had invoiced over the course of five years.
The Apple Commission withheld payment of $505,138 this spring and did not renew the contract with SCS when it expired in June.
The Wenatchee World reported that the commission contracts with 11 international businesses to market and sell Washington apples. Most of those main contractors hire subcontractors.
Todd Fryhover, president of the apple commission, said staff members received a tip from a subcontractor in March that something was wrong with the invoices the contractor was submitting to the commission.
“Our first reaction was disbelief. We pride ourselves in our representatives,” he told the World.
The New Delhi company disputes the investigation results.
“We categorically deny the initial conclusions presented in the WSAO audit report,” Keith Sunderlal, owner of The SCS Group, told The Wenatchee World via email. “A review of the report by our accounting team is currently underway and we hope to … demonstrate that there has been absolutely no loss of tax payer or industry funds. We are confident that our firm will be absolved of these allegations.”
The state Auditor’s Office said that SCS has contracts with other state commodity commissions, but the investigation dealt only with the Apple Commission. Pear Bureau Northwest ended its relationship with SCS earlier this year after an audit came to a similar conclusion.