HONOLULU -- An audit of the state's controversial bottle and cans recycling program found that a lack of oversight makes it vulnerable to fraud, KITV 4 News reported.

Under the program, residents turn in bottles and cans for 5-cent cash refunds.

But State Auditor Marion Higa said the system is far from perfect.

"There are various places along the way for fraud," said Higa.

Higa said various staff members waited in lines at redemption centers across the state and purposely exaggerated the number of cans and bottles they had.

Higa said in 15 out of 16 cases, staff members were overpaid because of a lack of verification.

"There is no one checking to see if in fact what they turn in is what they should have been paid for," said Higa.

Deputy State Health Director Laurence Lau heads the recycling program. He said the new program is experiencing growing pains.

"We do intend to increase the amount of field inspections and verification that we do, but I also want to say that almost all environmental programs run largely on the honor system," said Lau.

Auditors also found that customer service and regulations at redemption centers varied greatly.

They found that some centers randomly close when they run out of money or container space.

"The Health Department is not enforcing the agreements. They don't have staff out there to double check -- to make the redemption centers follow their contractual obligations," said Higa.

Lau said the Health Department will address the issues discoverered by auditors.

"We have been meeting with the redemption centers frequently to address these problems and we have been talking with the Attorney General's office to see exactly what our legal authority is to force better service," said Lau.

Higa said the accounting records for the recycling program were so incomplete that financial auditors could not audit the program's finances.

Lau said the Health Department is updating its accounting policies for the recycling program and is hiring an additional accounting clerk to improve the program that handles tens of millions of recyclables a year.

He said since Jan. 1, the number of redemption sites has nearly doubled.