Comptroller launches audit of DBI code-enforcement practices amid insider-trading concerns

The San Francisco Controller’s Office will begin a performance audit of the Department of Building Inspection’s code-enforcement practices to determine whether people associated with the department had an unfair advantage in property transactions, Controller Ed Harrington told the Building Inspection Commission on Monday.

Harrington said the office will match names associated with DBI — including employee names, LLCs and DBAs — against property records, assessor files and DBI enforcement records to identify potential conflicts. "We would propose that we start this almost immediately and that we would have a report back to you in 3 to 4 months," Harrington said.

The audit is framed as an assessment of scope rather than a personnel proceeding. Harrington said the records the audit will examine are public. "The records we’re talking about are all public already," he said, adding that the office conducts quality assurance on findings and gives departments an opportunity to respond before releasing a final report.

Commissioners expressed interest in preserving privacy and due process for employees while seeking transparency. One commissioner said the goal was to address an "appearance of impropriety" and to clarify whether issues raised in recent news stories represented isolated incidents or a broader problem.

Harrington described the audit’s expected outputs as both diagnostic and prescriptive: if issues are identified, the controller’s office will recommend preventive and detective controls — for example, disclosure forms and approval processes — and work with the commission and the ethics commission on implementation.

The commission president and other members asked about authorization and timing; Harrington said he initiated the engagement after meeting with the commission president and would give preference to requests from the mayor, board and commissions as outlined in Proposition C, which expanded the controller’s audit authority. Commissioners and staff said the controller’s office will provide the commission an interim timeline and that resources for the work are available from previously appropriated funds.

Harrington and his audit team said they will be mindful of personnel and privacy issues while relying on public records for their tests. The commission did not take formal action on the audit at Monday’s meeting; the controller’s office indicated it will return with findings once the review is complete.