CHRO finds state agency retaliated against whistleblower

The Commission on Human Rights and Opportunities (CHRO) found that the Department of Economic and Community Development (DECD) retaliated against former employee Adam Osmond by denying him an interview for a job position several years after he became a whistleblower.

“Mr. Osmond established by a preponderance of evidence that DECD did not interview him for the position of supervising accountant in retaliation for his whistleblowing,” the Presiding Human Rights Referee Jon P. FitzGerald wrote in the final decision .

Osmond alerted Connecticut state auditors that DECD was extending and giving additional loans to businesses that were delinquent in their repayment , was not billing interest to some borrowers, paying high third-party lender fees, and was improperly tracking loans between the years of 2015 and 2017.

Osmond worked as an accounts examiner for DECD during Gov. Dannel Malloy’s administration, a time during which the administration and DECD leadership sought to boost Connecticut’s business economy during tough years by dishing out loans and incentives to small and large businesses.

After initially alerting DECD officials to his findings of “financial irregularities,” Osmond’s service rating review was downgraded; after alerting them a second time and seeing no action taken, Osmond went to the state auditors. The auditor’s substantiated Osmond’s findings in a March 2020 report , according to the CHRO Final Decision.

That audit found DECD had awarded $900,000 in additional loans to companies who were already delinquent on paying their initial loan to the state, another company received $1.2 million without meeting their hiring requirements, there was inadequate financial review of companies, and that DECD had modified existing loans to grant $21.5 million in loan forgiveness.

Osmond took a job with the Department of Housing in 2017, three years before that audit was released. However, when he applied for the position of supervising accountant for DECD in 2020 he was denied even an interview, despite having submitted all requisite materials, and already working as a supervising accountant with good performance reviews at DOH.

According to the CHRO report, one official to whom Osmond had initially reported the loan problems was involved in the hiring process, and DECD’s chief administrative officer at the time made the “highly unusual” move to contact the head of Human Resources and request he “handle the filling of this vacancy very carefully.”

Osmond filed his retaliation claim after being denied the interview, making this a four-year ordeal during which he represented himself against the Attorney General’s Office representing the state. DECD argued that Osmond did not meet their qualifications but did not review all of his submitted materials and hired someone with fewer of the required credentials, according to the decision.

“Mr. Osmond introduced sufficient evidence to establish a causal connection between the denial of the interview and his whistleblowing,” the CHRO Final Decision said. “While the length of time between Mr. Osmond’s whistleblowing and DECD’s adverse action might otherwise negate the inference of a causal connection, in this case the denial of an interview was DECD’s first opportunity to retaliate.”

Osmond was seeking lost wages, vacation time and damages, but, according to the decision, did not establish “any economic loss or emotional distress.” Instead, the CHRO ordered that for the next two years, Osmond is guaranteed an interview for any posted position Osmond applies for at DECD.

Gov. Ned Lamont nominated David Lehman as head of DECD during his first term. Lehman implemented stricter controls around how state money is loaned, granted, or otherwise distributed to companies in the name of economic development.

DECD did not return request for comment.

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