Legislators have authorized an audit of the California office responsible for addressing the state's HIV prevention efforts and care for people living with HIV and AIDS. It comes several years after the California Office of AIDS was rocked by a fraud scandal that saw two former employees plead guilty to federal charges.
At the request of gay state Senator John Laird (D-Santa Cruz), the Joint Legislative Audit Committee recently approved the audit. Laird, who is vice chair of the committee, had worked with his colleagues, lesbian Senate President pro Tempore Emerita Toni Atkins (D-San Diego) and gay state Senator Scott Wiener (D-San Francisco) to seek the examination of the Sacramento-based office's inner workings.
"I am glad my colleagues on the Joint Legislative Audit Committee believe, as I do, that an audit of the Office of AIDS is sorely needed to assess the effectiveness of the office when it comes to coordinating state programs, services, and activities relating to HIV/AIDS," stated Laird.
It comes as state health officials continue to respond to a scathing audit into their lackluster collection of LGBTQ demographic and health data that California State Auditor Grant Parks released last spring. The governor's office did not respond to the B.A.R.'s request for comment about the audit of the AIDS office.
A day after the B.A.R. posted its story on its website May 22, the state health department emailed a reply stating it's "Office of Aids is committed to assessing, preventing, and interrupting the transmission of HIV and meeting the needs of those we serve. We welcome the opportunity to work with the State Auditor's Office."
As the Sacramento Bee was first to report, the former employees defrauded the AIDS office of approximately $2.7 million between December 2017 and November 2018. But their expenditures on season tickets to sports games, $184,000 on trips to Disneyland, and a boat cruise initially went undetected.
In March 2022 Schenelle M. Flores was sentenced to five years and 10 months in prison and ordered to pay over $2 million in restitution to the state. The following month, Christine M. Iwamoto was sentenced to two years in prison and ordered to pay $481,200 in restitution for wire fraud and conspiracy to commit money laundering.
A report into the matter that the Office of AIDS commissioned from Deloitte Financial Advisory Services LLP in 2019 found the prevention branch of the office, where the fraud scheme originated, had sloppy recordkeeping systems, as the B.A.R. reported after obtaining a copy of it via a public information act request.
The Office of AIDS is located within the California Department of Public Health's Center for Infectious Diseases. It is comprised of the Division Office and six branches: Support; Surveillance, Research & Evaluation; HIV Care; HIV Prevention; AIDS Drug Assistance Program; and AIDS Drug Assistance Program and Evaluation and Informatics.
In a March 19 letter sent to audit committee chair Assemblyman Gregg Hart (D-Santa Barbara), Laird and his fellow lawmakers noted, "While the office's mission is one of great significance and importance the office has a troubled past." They referenced the media reports about the fraud scandal, writing, "it is disturbing these public servants were able to commit such a shameful crime."
The legislators added, "This gross abuse by OA staff is even more disturbing given LGBTQ people generally are also known to receive poor quality of care due to stigma, lack of health care providers' awareness, and insensitivity to the unique needs of this community."
Among the various issues they want the audit to address is if the AIDS office has fully corrected past auditor and reviewer findings, as well as implemented relevant recommendations made over the past five years. They also want assurance that its funding allocations to local health jurisdictions and community-based organizations that provide health services "are being spent appropriately and directly on activities and services related to HIV/AIDS."
They specifically want a review of the Housing Plus Project overseen by the AIDS office's HIV Care Branch that is available in Kern, San Joaquin, and Santa Clara counties. The legislators asked that the auditors "identify the utilization rates for each service provided" by the project beneficiaries in the three counties and "identify the methodology used for selecting" that trio of counties.
"According to a past audit conducted by the State Auditor (2020-002), OA may have provided benefits to ineligible individuals. Determine whether OA now has sufficient controls and oversight to ensure that only eligible beneficiaries participate in HPP," wrote the legislators.
They also want the audit to "identify the biggest burden and challenges that affects delivery of services or programs administered by OA." And they are calling for "a survey of health jurisdictions and CBOs regarding various related matters, including ways they believe OA could improve."
UPDATED 5/23/24 with a statement from the state Office of AIDS.
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