An attorney representing a Huntington Beach-based nonprofit Friday blasted as “disgraceful” Orange County’s lawsuit alleging it misappropriated funding for programs bringing meals to needy seniors to buy and repair properties.
The county on Thursday sued the Viet America Society alleging misappropriation of millions of dollars allocated for meal deliveries to need residents during the pandemic.
Among the defendants in the county’s lawsuit against the society is Rhiannon Do, the daughter of county Supervisor Andrew Do. Rhiannon Do is accused of using some of the money to buy a home in Tustin.
“This lawsuit is a disgrace,” attorney Mark Rosen said in a statement. “There are many, many factual errors in the complaint.”
Rosen said the head of the nonprofit, Peter Pham, is accused of buying property in Buena Park with his wife.
“Peter Pham is not married,” Rosen said. “He does not know a Ngoc Tran. He does not own any property in Buena Park.”
He also disputed allegations about money given to the nonprofit for a war memorial in Mile Square Park.
“That war memorial was built,” Rosen said. “It’s there. The work was done.”
Rosen added that the Viet America Society “continues to provide food and delivery for the poor and the disabled today. You are all invited to co me and see it in action. And they are keeping excellent records today.”
Rosen said the nonprofit provided the services promised in the grant, but failed initially to keep good records.
“All the contracts were honored in the provision of services,” Rosen said. “This lawsuit is a smear job.”
The lawsuit seeks to recover “millions of dollars … from a contractor that the county retained to provide nutritional meal services to elderly and disabled Orange County residents during the COVID-19 pandemic.”
According to the suit, leaders of the Viet America Society “brazenly plundered these funds for their own personal gain. Defendants saw the opportunity and conspired to embezzle pandemic relief funds by executing contracts that they never intended to perform, instead using the funding streams as their own personal banking accounts.”
The lawsuit also names as defendants Warner Wellness Center; Perfume River Restaurant and Lounge; Peter Pham, the president of the nonprofit; Dinh Mai, the secretary; Thu Thao Thi Vu; and Rhiannon Do.
“It’s very disappointing,” Orange County Supervisor Doug Chaffee said of the lawsuit filing. “… There may be other agencies that will be addressing this, like the district attorney.”
The lawsuit was filed a day after Orange County Supervisors Katrina Foley and Vicente Sarmiento called for investigations and an audit of the public funding of Viet America Society and another nonprofit, Hand to Hand Relief.
The lawsuit against the Huntington Beach-based Viet America Society alleges that “multiple co-conspirators formed VAS in June 2020 to apply for county contracts to obtain federal and local funds for their private and personal benefit.”
The lawsuit also alleges the nonprofit “failed to complete a Vietnam War memorial” it received funding for.
Officials with the Viet America Society have been chasing down receipts to document its services for an audit. In January, the accounting firm of Buu D. Nguyen issued an analysis that showed about $25,000 in unaccounted funding, but county officials earlier this month demanded the nonprofit pay back about $4.2 million.
The county has also sent a letter threatening litigation against Hand to Hand Relief, which officials say has also failed to provide documentation for about $1 million in county funds.
Both nonprofits were tasked with providing meals to needy residents during the COVID-19 pandemic.
The lawsuit alleges the Viet America Society “engaged in pervasive self-dealing, pocketing local and federal funds,” and the county believes the nonprofit “used these funds to finance lavish purchases that includes real property and repairs and improvements on such property.”
The lawsuit alleges the nonprofit fired its auditors when they “could not complete a contractually and federally required single audit due to VAS’ woeful and inexcusable lack of required documentation.”
Foley and Sarmiento on Wednesday asked the Orange County District Attorney’s Office to investigate, as well as state and federal authorities.
Rosen, the VAS attorney, wrote a letter to county officials Monday saying Nguyen’s firm had already performed an audit that was as precise as possible. The audit blamed some of the issues on short-staffing and noted a new chief financial officer had been hired.
The problem, Rosen said before the lawsuit was filed, was the nonprofit has been struggling to document every meal delivered.
“They’re now trying to get records from people who don’t want to deal with the government, who are suspicious of the government because of their experience as refugees,” Rosen said of the Vietnamese community the nonprofit serves.
“The county, three years after the fact, has impossible standards now as if there was no pandemic or no one was sick,” Rosen said. “It’s easy to question all of this in hindsight, but people forget what it was like back then before we had the vaccines.”
Many of the agency’s drivers were practicing social distancing during the pandemic so they did not get the required paperwork to prove delivery of some meals, Rosen said.
“Now the county is saying you should have them fill out a form and make contact,” Rosen said. “You’re applying standards that were impossible to apply during COVID.”
If it comes down to going to court to settle the issue, Rosen said, “We’ll call all the delivery drivers and food preparers to show that everything was entirely above board, and that this is basically a political witch hunt at this point.”
He added, “They’re asking for every single penny on an entirely false assumption that nothing was done. People received the food, deliveries were made.”
Supervisor Andrew Do has come under fire because his daughter worked for the Viet America Society when he voted on contracts involving the organization. Do has said he would have disclosed the relationship if he felt it was required.
Rosen warned that a county lawsuit will discourage other nonprofits from responding to calls for services during emergencies.
“The two supervisors (Foley and Sarmiento) who issued that press statement are posturing,” Rosen said. “They’re not going to get every penny back because it’s all been spent.”
Foley said the nonprofits had a duty to document the work.
“It’s a little late to be complaining when the requirement was to keep track of all this documentation in real time, so they don’t have to go back and reinvent what happened,” Foley said. “The expectation should have been to track it in real time. There’s very specific requirements. All the other vendors could do it, so why couldn’t they?”
Foley added, “My patience is as thin as their bookkeeping records at this point. … I don’t really have any use for whining and complaining after the fact.”