Fraud Alleged in L.A. Housing Contracts

LOS ANGELES (CN) - The Los Angeles Housing Authority claims a project manager swiped $800,000 from contracts for low-income and disabled housing and doled most of it out to his family. More than 90 of the first contracts Victor Taracena awarded when to his family's "purported organizations," the city says.

The city claims Victor Taracena fixed bids by concealing his relationship with family members who double billed and were overpaid, and submitted other bids in the names of companies for whom he was not authorized to act, or that did not exist.

Most of the jobs were for less than $2,500, the maximum contract possible without soliciting bids, the city says.

The Housing Authority hired Taracena, 38, as a construction project manager in August 2003. He eventually became acting director of technical services. One of his responsibilities was to bring city housing developments into compliance with the Americans with Disabilities Act.

According to the Superior Court complaint, Taracena steered jobs to his family members by overriding and manipulating the bidding process, and by lying about the nature of his relationships with those to whom he awarded contracts.

The city claims Taracena misappropriated about $800,000. It claims his family's companies were paid for jobs they did not do and were overpaid from double billing.

Taracena allegedly awarded more than 150 contracts to his family members and others' companies, many of whom had little or no expertise in the work they were hired to do. And it claims Taracena submitted bids in the names of companies that had no knowledge of the bids or did not even exist.

The Housing Authority seeks an injunction and damages for fraud, unjust enrichment, civil conspiracy, racketeering, and breach of good faith and trust.

Named as defendants are Victor, Bennett and Diego Taracena, Pratt-Jennings-Holmes, Decker & Durden Engineering, Trevor and Associates, and "So-Called Artist."

The city is represented by Charles Slyngstad with Morris Polich & Purdy.

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