Two agreements with ties to former Supervisor Andrew Do have been referred to the Orange County District Attorney’s Office as the county’s internal auditor continues a review of spending paid for by federal pandemic relief funding.
The internal auditor reported to the OC Board of Supervisors last week that a sampling of contracts funded by the county’s American Rescue Plan Act allocation were found in compliance with monitoring requirements, but the report notes the two agreements referred to the DA’s Office – and County Counsel’s Office – for review: a $2 million contract with Abound Food Care and $25,000 in small business support for Garden Grove-based printing company DTN Tech.
The county received $616.8 million in pandemic relief aid from the federal government through ARPA; each of the five supervisors received $10 million of that to spend at their discretion within the communities they represent.
The Board of Supervisors, in September, requested the internal auditor conduct risk assessments of all federal ARPA-funded contracts and expenditures to ensure auditing and monitoring requirements were being met following concerns raised over some of the discretionary funding out of Do’s office and an FBI investigation.
Do pleaded guilty in federal court to taking more than $550,000 in bribes to steer $10 million to Viet America Society. A county lawsuit accuses the nonprofit and some of its affiliates, including Do’s daughter, of using the funds intended for a meal program and a Vietnam War memorial for personal gain.
The county auditor’s report last week said the office took note of the DTN Tech support directed by Do’s office because of a lack of documentation.
To be eligible for financial assistance during the pandemic, a business needed to meet certain criteria, such as having fewer than 50 employees and experiencing at least a 25% decline in revenues. There was no documentation to support DTN Tech met the criteria, the auditor said.
“DTNTECH has complied and submitted requested documentation for the small business grant at the time and was approved to receive the grant from the county,” Serena Nguyen, CEO of DTN Tech, said in an email. “Recently, at the county’s request, we have again shared the documents we initially submitted to the county and are committed to providing any further information necessary.”
The Abound Food Care contract was referred because it contracted Westminster-based Perfume River Restaurant, “a subcontractor involved in the former District 1’s misconduct, as well as potential related party transactions made to certain subcontractors,” the auditor’s report said.
Mike Learakos, CEO of Abound Food Care said he expected the contract would be looked into and welcomed any investigation. The group subcontracted four to five kitchens that would end up producing about 62,000 meals, he added.
Perfume River Restaurant & Lounge, a restaurant owned by Aloha Financial Investment and now at the center of the county’s lawsuit for alleged embezzlement, was one of the subcontractors. The restaurant was also contracted by Viet America Society.
Learakos said Perfume River was “identified to us by Andrew Do as a meal provider who did great work for the county during COVID and recommended that we look at using them for culturally appropriate meals to service the Asian community.”
“We met with all of our different kitchens, and we identified what the process would be like,” he added. “We were following a process that really went beyond what the county was expecting.”
Abound Food Care kept a thumb drive with 47 pages that identify where all the meals went, Learakos said. The group has cooperated with the FBI’s investigation into Do and the embezzlement scheme, Learakos said.
“We are very confident that we were able to use the county’s money wisely, and quite honestly, I’ve made the comment to the county, you should really be asking us how we kept a dishonest character on the straight and narrow. It was because our process was in place,” Learakos said. “We want to make sure that we are not associated in any way with that nefarious activity. I’m very comfortable that we will be fully exonerated.”
When asked about the auditor’s referrals, Kimberly Edds, spokesperson for the District Attorney’s Office, said in a text message, “We are aware and we have an intensive ongoing investigation … in general.” Edds did not respond when asked for clarification on whether she meant the investigation was regarding the two contracts or a broader scope.
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