SCHA chair: Sponseller should have known about missing funds; No evidence he was involved

Erwin speaks to the media at the press conference Thursday. (Alan Garmendia/WCIV)

By Brian

COLUMBIA, S.C. (WCIV) -- The chairman for the South Carolina Hospitality Association spoke to a room filled with journalists and cameras. With a look of seriousness on his face, he said the mystery of nearly $500k in missing funds is something former SCHA chairman Tom Sponseller should have known about.

Sponseller was found dead in Columbia in late February of a self-inflicted gunshot wound. He was reported missing by his family on February 18. Police his suicide note mentioned his disappointment that hundreds of thousands of dollars went missing from the organization.

"Absolutely, Tom should have known," said newly tapped chairman Rick Erwin.

Erwin said over the course of 3-4 years, $480,944.93 of association funds were misappropriated. Officials with the SCHA said there was a pattern to the misappropriated funds. They said the amount of money unaccounted for increased each year.

Results of the association's internal investigation, have been shared with law enforcement agencies, including the Secret Service and the Department of Treasury. Erwin said Sponseller and former finance director Rachel Duncan where the only two people held accountable for the missing funds. While the SCHA was disappointed in Sponseller's lack of knowledge of the missing funds, Erwin said their internal investigation did not reveal Sponseller was involved.

It did however, according to Erwin, yield some interesting information on Duncan.

Specifically, he said, Duncan's salary had been increased from a rate at around $40,000 a year to $70,000 a year.

"There were a number of things that she misappropriated. Checks, payroll, deposits, expenses, literally all of the above," Erwin said. "Rachel's W2 was somewhere north of $70,000. That number was way above where it was supposed to be."

Erwin said it wouldn't surprise him if association members had lost faith in the agency's ability to operate, but he stressed the SCHA would be working to put the unfortunate turn of events in the past and work to prevent any such issues in the future. He said despite the fact that the internal financial audit of the SCHA was not complete, corrective action had already taken place, including but not limited to the creation of several new watchdog committees for the organization.

"What this group did behind me and what our members will do is move forward and put this behind us," Erwin said. "I don't foresee any lapse in terms to service to our members."

Though South Carolina Governor Nikki Haley did not attend the press conference or the SCHA board meeting help prior, she did express her support for the organization via YouTube.

"Through the biggest challenges are the greatest opportunities," Gov. Haley said. "...Never before has the hospitality association had the opportunity of success that we've got right now. I want you to know that I am there for you. My office is there for you, whatever you need, whenever you need it in order for us to lift you back up and get you running again. We will be there."

Check back with ABC News 4 or watch upcoming broadcasts for more information as we continue to develop this story.

* ABC News 4's Natalie Caula contributed to this report.