State Loss of $750,000 in Crime Victim Funds Laid to Lax Procedures

A state crime victims compensation program, already running out of cash because of a deluge of claims, lost nearly $750,000 because some victims were overpayed and some claims were never substantiated, a preliminary state audit has found.

The confidential audit, conducted by the Department of General Services between November, 1986, and last March, found $129,000 in claims that were paid even though the specifics of the crime could not be verified or the “victim” appeared to have provoked the attack.

Additionally, the audit team discovered that $617,000 was paid to victims in excess of what was justified, but the state failed to seek repayment.

A draft copy of the report obtained by The Times identified “serious internal control weaknesses” in the Board of Control, which runs the Victims of Crime program. It concluded that the problems were due not only to errors but in some cases “improper activities” by officials who ignored previous rejections and paid claims without justification.

“The internal control system is not adequate to provide reasonable assurance that state resources are protected,” the audit concluded.

Austin Eaton, executive officer of the Board of Control, declined to comment specifically on the draft audit until a final report is released.

“All I can say is that we make every effort to ensure that when we make payments, they are for legitimate victims,” Eaton said. “We have been looking at the process to see if there are any areas that need improvement.”

Eaton added, however, that “we expect to take issue with some of the findings.”

“But it’s premature to reach a conclusion until we know what the final findings are,” he said.

The Victims of Crime program was established in 1965, the first of its kind in the nation. Although initially limited to compensating victims of violent crimes, its scope was greatly expanded after voters in 1982 approved the so-called Victims’ Bill of Rights Initiative--backed by anti-tax crusader Paul Gann--amid widespread claims that the justice system was treating criminals better than their victims.

Under the program, victims may be compensated for medical costs, psychological counseling expenses and lost wages. Although the law allows claims of as much as $46,000, actual payments average $2,642.

$5 Assessment

Money to pay the claims comes primarily from a $5 assessment added to each $10 in criminal penalties levied by the courts. Last year, the state received $37.3 million. However, because of spiraling claims, the fund spent $42.5 million by drawing on previous-year surpluses.

With the fund on the verge of running out of money, Gov. George Deukmejian late last month signed two bills designed to raise an additional $30 million yearly by increasing the penalty assessment by $2 on each $10 in fines.

Among specific cases reviewed by the audit team was a claim paid to a victim who was later found to have sustained injuries as the result of a fight he initiated. In that case, the victim, whose identity was not divulged, reportedly confronted a group of juveniles on a neighborhood street, telling them “he would take them all on, one on one.” Auditors did not disclose how much was paid to the victim.

In another case, a Board of Control employee placed a claim on a so-called “consent agenda” to be approved by the Board of Control, generally without discussion, even though the board had previously denied the claim. In that case, auditors determined that the “victim” had pulled a knife on another individual with whom he had been arguing.

No Review

According to the auditors, since staff members of the Board of Control were seen as having “proven track records,” they had been allowed to place such items on consent agendas without review by a supervisor.

Assemblyman Charles M. Calderon (D-Alhambra), who authored legislation to bail out the victims fund, said the audit underscores the need for a separate victims agency to operate the fund. Similar legislation introduced last year by Calderon died in the Senate amid opposition from the Deukmejian Administration and the Board of Control.