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Housing agency fires auditor

Investigator says L.A. officials interfered with his efforts to look into a bid-rigging scheme.

August 25, 2007|Ted Rohrlich and Jessica Garrison | Times Staff Writers

The chief investigator for the Los Angeles Housing Authority, Abel Ruiz, was abruptly fired this week after complaining that people inside the agency interfered with his efforts to get to the bottom of an $800,000 bid-rigging scheme, his attorney said Friday.

Housing Authority Executive Director Rudolf Montiel said that he could not comment on a personnel matter but denied any coverup. In fact, Montiel said, he had referred the bid-rigging matter to outside agencies, the Los Angeles County district attorney's office and the Department of Housing and Urban Development, for "a thorough and complete investigation."

The Times reported last month that a housing authority manager, Victor Taracena, had awarded construction and design contracts to family members and to three firms with ties to present and former City Council members in the 14th District. Agency files showed that the competition for many of the contracts was fixed. Through his attorney, Taracena, who was fired, has denied wrongdoing.

City housing authority officials said Friday that they believe much of the work called for in those contracts was not done.

Ruiz's allegations bring new controversy to an already troubled agency, which has been beset by corruption and infighting in recent years. Montiel has portrayed himself as a reformer, intent on cleaning up the agency and focusing on serving about 100,000 of the poorest people in Los Angeles who are in need of places to live. Indeed, Montiel said he had hired Ruiz in 2005 to help him.

Ruiz headed the authority's internal controls department and did the initial investigation into the alleged bid-rigging.

But "in the middle of his fact-finding, he was stopped," when housing authority leaders decided to hand the case over to prosecutors, according to Ruiz's lawyer, Craig T. Byrnes. Ruiz saw this move as premature.

Then, the lawyer said, Ruiz learned of an odd development: Even though the case had been turned over to law enforcement, another official in the housing authority continued looking into it. His inquiry appeared to be focused on whether the work, much of which involved drawing plans to build ramps and other aids for the handicapped, was ever performed. Ruiz said no drawings had been found in agency files. Byrnes said that Ruiz asked that this effort stop so as not to alert possible criminals that they were under suspicion.

But, Ruiz's lawyer said, the effort did not stop and at least one of the politically connected firms was told in a letter from the agency that the firm could cure any problem by "self-certifying" that it had done the drawings.

The lawyer said that when Ruiz objected, housing authority leaders started freezing him out of meetings, bad-mouthing him and ultimately fired him without giving him a reason. He said Ruiz plans to file a claim against the housing authority for wrongful termination.

Montiel suggested that the letter Ruiz saw as nefarious was an innocent attempt to obtain information. Montiel said it now appears that, while some drawings may actually have been prepared by contractors, firms owned by Taracena's family did not do much of the construction work for which they billed.

Taracena supervised more than 150 contracts worth about half a million dollars that went directly to companies his brothers created, contract files show.

Seven other contracts worth $289,000 were awarded to non-family firms, two of which had little or no expertise in the work they were hired to do.

These firms -- all with ties to current or former Los Angeles City Council members from the Eastside -- won their contracts in bidding processes fraught with irregularities. In one case, a losing bid was submitted by a nonexistent company. Other such bids came from actual companies which, when contacted by The Times, said they were surprised to learn that bids had been submitted in their names.

Representatives of two of the firms -- the Estrada Courts Residents Management Corp. and Grande Vista Associates -- denied any knowledge of rigged competitions. The head of the third, KV and Co., did not respond to repeated requests for comment.

The Estrada Courts group, a nonprofit run out of an Eastside housing project, received four contracts collectively worth about $95,000. It has employed former City Councilman Richard Alatorre as a consultant.

Grande Vista is headed by political consultant Gustavo Valdivia, a former member of Councilman Jose Huizar's staff. It landed a $98,895 contract.

KV and Co., which won two contracts worth $95,230, was the sole contractor among the three firms to have design expertise. Its registered agent is former City Councilman Nick Pacheco.

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ted.rohrlich@latimes.com

jessica.garrison@latimes.com

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