Auditor General William Holland of Illinois found breaches in security in Illinois offices that process 3.4 million tax returns and uncovered questionable “irregularities” in the awarding of a controversial $2 billion lottery-management contract.

In the agency’s Chicago and Springfield tax-processing offices, full- and part-time employees who handled confidential tax returns were permitted to carry personal cell phones equipped with cameras, said a Chicago Sun-Times report.

Holland also found sensitive tax records on desks, open shelving areas and tables in areas where visitors had access and, in one instance, stored in an open bin in a readily accessible hallway within a tax-processing area, the report said.

Holland also disclosed instances where uncashed taxpayer checks turned up in the desk drawers of employees who no longer worked for the Department of Revenue and faulted the agency for not performing background checks on state workers who had access to the department’s taxpayer-information database, said the report.

“I don’t think we proved instances of identity theft,” Holland told the Chicago Sun-Times. “But I’d tell you, when you have so many people with so much access to so many records, it’s only a matter of time until something bad happens.”

An agency spokeswoman disputed the notion that the Department of Revenue was putting tax records at risk and that safeguards exist to bar general public access to sensitive tax-processing areas and to closely monitor agency employees who work there and their computer access.

“We are working every day to improve our ability to protect the privacy of the people who trust us,” Revenue spokeswoman Sue Hofer said. “That means installing new cameras. That means upgrading our system of who’s allowed into the building and into more sensitive areas of the building.”