Forensic audit finds signs of steering, emergency purchasing and weak oversight in Phase 1 review of Orange County contracts

Weaver & Tidwell presented Phase 1 of a forensic audit to the Orange County Board of Supervisors on March 24, documenting procurement weaknesses and patterns the auditors say merit additional review.

Auditor Travis Kasner told the board his team reviewed 145 priority contracts executed between 2019 and 2024 totaling about $486,000,000. The presentation highlighted three themes: extensive use of emergency purchasing and sole sourcing during the pandemic that reduced competitive oversight; advanced lump‑sum payments and limited invoice detail on certain service contracts; and apparent steering of contracts and pass‑through grants tied to District 1 activities, including vendor relationships and sponsorship revenue routed through third parties.

Kasner said the auditors identified about 33 contracts with notable concerns and described several examples: $300,000 pass‑through grants in the arts relief program that auditors found were directed to specific subrecipients and subsequent payments to vendors (two $300,000 awards were recorded as instructing portions of funds to named entities); advanced payments for festival entertainment with limited invoicing; and certain contract language allowing self‑certification that auditors called unusual compared with other districts.

The auditors recommended a suite of corrective measures: standardized invoicing and monitoring of federal contracts; extending due diligence to subcontractors and subawards; enhanced annual training on fraud and internal controls; better guidance on emergency justification memos; and review of campaign contribution discrepancies flagged during the audit for potential referral to the Fair Political Practices Commission.

Supervisors followed with extensive questions. Supervisor Nguyen pressed auditors and staff about the 3 60 Clinic contracts (claims submissions for COVID testing), asking for full documentation and exploring whether referrals to the state Attorney General or Department of Justice were appropriate. Multiple supervisors asked the county to coordinate with CalOptima and state investigators, and to pursue recovery of any overpayments.

County staff said many of the recommendation items are already in progress and that the audit team plans a Phase 2 review that may cover additional District 1‑linked contracts. The board received and filed the Phase 1 presentation and discussed next steps, including potential referrals to external investigators and the FPPC for campaign finance discrepancies.

What the audit means: The Phase 1 report identifies governance and procurement vulnerabilities; several supervisors said it represents a first step toward systemic reforms and potential legal referral. Audit authors and county staff signalled Phase 2 will expand the review to more contracts and vendors.