A day after a charity rejected demands to repay $2.2 million in COVID relief funds, Orange County authorities instead handed it a letter recalling $4.2 million in funding for a food program and threatening legal action.
In Wednesday’s letter to the Viet America Society, the county ordered the group to repay the money by Aug. 26 – this time increasing the amount from the $2.2 million originally requested last month after the charity missed several deadlines to prove it had properly spent the money to feed shuttered seniors. The public funds were allocated by First District Supervisor Andrew Do from his county’s discretionary funds.
In the letter, District Attorney Leon Page said his office would recommend “filing suit in the California Supreme Court and exhausting all available legal remedies” if the refund and requested documents were not received by the deadline.
The county’s latest demand comes after Viet America Society attorney Sterling Scott Winchell told the Orange County Register earlier this week that the group would not pay back any money because, “The bottom line is, these people did the work.”
He said the nonprofit intends to complete an audit of how taxpayer funds are being used.
Winchell did not respond to requests for comment Thursday about the county’s latest repayment demands. Do and Do’s chief of staff Chris Wangsaporn also did not respond to requests for comment.
Wednesday’s letter noted that the Viet America Society had missed several audit deadlines and that the charity’s auditor, The Pun Group, had recently been fired. This came a day after the group told district leaders it would release a report saying the nonprofit did not have the necessary documentation, including receipts and subcontracts, to complete the audit.
“The Pun Group stated that VAS lacked internal controls, did not follow uniform federal guidelines, and did not follow funding source guidelines. Specifically, the Pun Group stated that meal accounting and participant rostering at VAS was problematic and that VAS did not have the necessary records to create an audit trail,” Page said in the recent letter. “The Pun Group also stated that its report would list VAS’s internal control deficiencies and inadequate record keeping and conclude that certain information could not be verified.”
The county has paid VAS more than $10 million for the feeding program since 2020, mostly from Do’s discretionary funds. He has been criticized for not publicly disclosing that his daughter, Rhiannon Do, was employed by the nonprofit – even though that is neither a violation of county policy nor state law.
“Due to the lack of documentation provided by VAS to date, the county has no way of verifying that the funds were used for the intended purposes,” Page said in his letter.
The reimbursement claim covers two contracts for the period December 2020 to May 2023.
In addition to the $4.2 million repayment, county officials hired VAS to prepare records and final reports for another $6 million from additional contracts to fund the feeding program and a Vietnam War memorial. The county also requires the Viet America Society to repay any unused or unspent money “according to the terms of the contract.”
The letter also instructed the Viet America Society to preserve its records “which represent important sources of potential evidence in this matter,” including any form of correspondence, spreadsheets, social media, handwritten notes, faxes, forms, calendar entries, and the like.
Page also ordered the Viet America Society to retain all records related to an affiliated nonprofit, the relief organization Hand to Hand. Hand to Hand also faces demands from the county to produce records and documents and to repay $3 million it received for a meal program. The county had initially sent a letter last month demanding repayment of only $1 million.
“As you are aware, the county, through its OC Community Resources division, has conducted a financial and reporting monitoring audit of its Nutrition Gap Program Services contract with (Hand to Hand),” Page wrote in an Aug. 7 letter to the charity. “Unfortunately, H2H has not cooperated with the audit and has not responded to (the county’s) request for required documentation and reports.”
Hand to Hand officials did not respond to calls and emails seeking comment Thursday.
Second District Supervisor Vicente Sarmiento called it “outrageous” that funds provided to organizations may not have reached residents who needed help during the pandemic.
“The COVID pandemic funds were intended to help people suffering from food insecurity while communities struggle to make ends meet, even as many residents risk their lives working as essential workers,” Sarmiento said Thursday. “We must continue the process to find out the truth about how the funds were used and use all legal means necessary to recover the funds if they were misappropriated.”
Sarmiento added that the county’s contracting process needs to be reviewed to ensure taxpayer dollars are spent as intended.
Fifth District Director Katrina Foley said if the Viet America Society meets its contractual obligations, she expects the organization to provide the relevant documentation promptly.
“If not, we will exhaust all available options to remedy the potential misuse of taxpayer funds,” Foley said. “The county has given VAS more than enough time to respond.”
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