Appeal Could Put DWP Joint Trust Audit on Hold

PERSPECTIVE-According to a story in today’s Los Angeles Daily News, a DWP union, IBEW Local 18, is planning an appeal of a Superior Court decision that granted Controller Ron Galperin the authority to conduct an audit of the secretive Joint Institute trusts. 

Union boss Brian D’Arccy’s attorney claims the audit cannot be conducted during the appeal process. 

This move comes as no surprise to anyone who follows Los Angeles politics and city governance. 

My concern is that critical records could be “lost” in the additional time the union has to prepare for an audit, that is if the appeal is unsuccessful. At a minimum, D’Arcy’s operatives could erect barriers that would make accessing records difficult or prepare a storyline to deal with potential findings. 

An aggressive audit could still uncover questionable practices in any event, but collaboration among those managing the trusts could color the results and diminish the final recommendations. 

No timeline was reported for the appeal. 

It is now even more important for Galperin to subpoena the DWP managers that served on the boards of the trusts, including Ron Nichols. They need to be questioned under oath. Either they have an idea of how some of the $40 million was spent, or they were negligent in their fiduciary duties to the public and management responsibilities with the DWP. 

Galperin must take steps to recover $12 million sitting in the bank accounts of the trusts, assuming the funds are still there.

 

(Paul Hatfield is a CPA and former NC Valley Village board member and treasurer.  He blogs at Village to Village and contributes to CityWatch. He can be reached at: [email protected])

–cw

 

 

 

 

CityWatch

Vol 12 Issue 34

Pub: Apr 25, 2014