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L.A. City Council votes to require centralized fraud reporting

Officials hope new policy will help identify systemic problems and keep bad behavior from being hidden.

October 19, 2011|By Kate Linthicum, Los Angeles Times

In the wake of recent corruption scandals in city departments, the Los Angeles City Council on Tuesday voted to require employees across various agencies to report all instances of waste, fraud and abuse to a single office — a move lawmakers say will help the city identify systemic problems and keep bad behavior from being swept under the rug.

All wrongdoing will now be reported to a unit in the controller's office. Current city law says employees "are expected," but not required, to report allegations of wrongdoing to the city controller's Waste, Fraud and Abuse unit, the city Ethics Commission or police. But city leaders say that language is vague, and too often departments fail to report their investigations of misconduct, leaving top officials in the dark.

That's what City Controller Wendy Greuel says happened with a little-noticed corruption case in the housing department. The case, in which a department employee allegedly secured bribes from multiple landlords while working the front counter at the agency's Koreatown office, was reported by The Times on Sunday. But Greuel said in a letter to the council Monday that city leaders were not told about the allegations and criminal prosecution.

"It's unacceptable that many elected officials and city leaders were not made aware of this incident of abuse," said Greuel, who is running for mayor.

The incident, she said, "falls on the heels of a wave of fraud," including reports of Animal Services employees stealing pets from animal shelters and a probe into bribery at the Department of Building and Safety that has led to the firing of four employees.

At Tuesday's meeting, Councilman Dennis Zine mentioned another case of possible misconduct: the theft last week of dozens of training guns from a Los Angeles Police Department facility.

Zine, who is running for city controller in 2013, was the author of the reporting measure, which he called "the first step to try to bring some closure to the continual saga" of misconduct. The measure also calls for a training program to help educate employees about city policies and asks the personnel department to create incentives that would compel employees to report bad behavior.

Councilman Paul Krekorian said the change to city code must also clarify exactly what qualifies as "waste, fraud and abuse."

kate.linthicum@latimes.com

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