Private agencies diverting millions
find parties, vacations, more|
Since 1998, county auditors have found more than $9 million in
unallowable or questionable expenses by the private foster-care
agencies that have contracts with Los Angeles County.
The audits revealed taxpayer funds were used to pay off Las Vegas
gambling debts, call psychic hotlines and pay for jewelry, parties,
lottery tickets, alcohol, vacations, antiques, artwork and even a
"They have abused both children and taxpayers," said Jon Coupal,
president of the Howard Jarvis Taxpayers Association. "Particularly
in these tough economic times, the fact that money is being misspent
this way is absolutely appalling. Local governments are screaming
for more revenues, yet they are grossly misspending these funds,
frittering away this money without any accountability at all."
Supervisor Michael D. Antonovich said the county should be
reimbursed for those misappropriated funds.
"There is no excuse for using money intended for foster children
to cremate one's father-in-law or to use those funds at Victoria's
Secret," he said.
Some of the executives of the private foster care agencies that
oversee the children receive up to $310,000 a year in salaries and
benefits, enjoy extravagant lifestyles and drive luxury cars
provided to them at public expense, the county audits reveal.
Some directors of foster-family agencies and group homes drive
around in head-turning vehicles Jaguars, a Land Rover, a Cadillac
Escalade SUV, Mercedes and Lexus provided to them at public expense,
according to the audits.
One official billed the taxpayers more than $12,000 for
membership dues and a banquet party at the Beverly Hills Country
"I think it suggests Los Angeles County is a national scandal,"
said Richard Wexler, an author, former university professor and
executive director of the National Coalition For Child Protection
Reform in Alexandria, Va. "There are lots of troubled foster care
systems in the United States. But Los Angeles County is always on
Department of Children and Family Services Director David
Sanders, who earns $175,000 a year and is among the nation's
highest-paid public child welfare agency directors, said taxpayer
dollars should be spent ensuring the safety of children.
"When we have that kind of credibility issue, it's little wonder
people can raise questions about our ability to get the work done,"
said Sanders, who took over the department in March. Since 1985, the
four previous DCFS directors have resigned under pressure from top
As private foster care agencies made millions of dollars off the
children under their care, critics say the Board of Supervisors
looked the other way. From 1995 to 2002, foster family agencies,
group homes and others spent more than $262,000 lobbying and making
campaign contributions to the supervisors, including more than
$67,000 in campaign contributions.
"I think it's clear that foster care has become an industry in
some parts of Los Angeles County," said child advocate Nancy Daly
Riordan, founder of United Friends of Children and wife of former
Los Angeles Mayor Richard Riordan. "There is definitely a financial
incentive to keep kids in foster homes way beyond what is
Troy Anderson, (213)974-8985 firstname.lastname@example.org
The group homes and foster family
agencies that care for most of Los Angeles County's foster children
have misused more than $9 million in taxpayer funds since 1998,
paying off debts at Las Vegas casinos, buying lingerie and even
paying for the cremation of an executive's father-in-law, county
Based on the audits, the Department of Children and Family
Services reviewed $6 million of the unallowable and questionable
costs from March 1998 to May 2001 and required the agencies to pay
back $1.5 million. So far, the department has received about
Here are examples of the disallowed spending:
Group home directors paid $4,500 in debts at two Las Vegas
casinos and spent $54,472 on lease payments for a luxury home.
Foster family agency directors bought $1,814 worth of lingerie
and racked up $6,113 on 116 restaurant meals, even sticking
taxpayers with the tab for their alcoholic beverages.
An agency director spent $774 to cremate his father-in-law.
Officials spent $12,247 for a membership at the Beverly Hills
Country Club and a $6,013 banquet party for 150 employees.
Agency officials spent $57,379 on legal fees and to settle sexual
harassment lawsuits by three former employees.
Directors purchased or leased two Jaguars, a Range Rover,
Mercedes, Lexus, Ford Expedition, GMC Suburban SUV and a Cadillac
Escalade SUV, which cost $1,083 a month to lease.
An official made $4,715 in credit card charges for various
unidentified items during trips to the Czech Republic, Great Britain
and Panama, and $989 in purchases made in Las Vegas at the MGM Grand
Hotel, Luxor and Rio hotels.
Auditors found agency executives purchased $3,800 worth of
pantyhose, razors, suits, shoes, pet supplies and jewelry and beauty
supplies in Las Vegas.
Officials billed the county $2,950 a month for a child who had
left the facility four years before, collecting a total of $35,400.
Payments for a president's 1998 Land Rover and credit card
charges for trips to London and New Orleans.
The audits showed the agencies seemingly missed no opportunity to
bill the taxpayers for personal items, no matter how trifling. One
audit noted $152 was spent on cigarettes, liquor, pet food and a