Boy Scouts Chapter Is Audited : Inquiry: National office investigates accusations that the Los Angeles council misused funds.

The national office of the Boy Scouts of America is auditing the Scouts’ Los Angeles Area Council to determine whether the local chapter has misused funds and inflated its membership figures to attract larger donations, national Scout officials said this week.

The audit stems from allegations by a fired Scout community director that the Los Angeles chapter routinely engages in such practices.

Frank Madrid, who formerly oversaw Scouting in Lennox, Inglewood and parts of South-Central Los Angeles, claims that the local council inflates rosters to solicit larger donations from corporations by signing up boys, counting them as members, then not following up by forming troops. He also alleges that the organization raises far more money than it lists in its budget for financing Scouting programs.

The national organization got involved in the controversy at the request of the Los Angeles chapter, which investigated the allegations and turned up “questionable practices” at a Scout after-school program for disadvantaged youngsters in low-income areas, said Terrence Tibor, Los Angeles Area Council spokesman. Findings of the local investigation, which have not been made public, have been forwarded to the national office in Irving, Tex.

National Scout official Carey Keane said the office is conducting a comprehensive review of the Los Angeles membership and its spending practices, as well as an audit of Scout personnel and payroll records.

“When allegations are made like this, they are treated very seriously,” said Keane. “We want to get to the bottom of this. And I’m sure (Los Angeles) would like to get it over with as soon as possible.”

Keane declined further comment on the audit, which he characterized as a rare occurrence, but said the results will be made public when the investigation is concluded. Tibor said results could come today or Monday.

The controversy began when Madrid wrote letters to dozens of Los Angeles corporate and civic leaders alleging “widespread fraud and deceit” in Scout membership and operations after he was fired in January.

Madrid says he was fired because he became increasingly vocal about his allegations of inflated membership rolls, particularly his charges that the Scouts exploited Latinos by signing up boys in Latino areas with no intention of mounting a program.

He later alleged that the Los Angeles Area Council annually raises millions in corporate donations, then only spends a small portion of the money on the programs for which the money is solicited. He said he had no proof of that allegation, but surmised it from his 14 years in the Scouts, during which he went from a volunteer in a Scout troop to a paid community director.

Scout officials say Madrid was fired for unsatisfactory job performance, including insubordination and inadequate supervision of Scouts. Tibor called Madrid a “loose cannon” and characterized his allegations as those of “a disgruntled, fired employee,” but declined to say whether Madrid’s claims had substance.

Tibor acknowledged Thursday that the group’s audit revealed possible problems in its outreach program, which includes the after-school division that targets low-income neighborhoods, and that the program is under review.

A February, 1990, comparison of Boy Scout membership stated that the Los Angeles council had the second-largest membership in the nation at 70,943. In December, the Los Angeles council claimed membership of 80,703 in a monthly report, and has pointed to a steady rise in membership in the past three years during fund-raising activities.

Madrid cited the apparent discrepancy to support his accusation of inflated membership.

However, Tibor said, the differing figures reflect a traditional drop-off in active membership after Christmas, as well as the elimination in February of the Varsity Scouting program, an athletics program that served 6,000 youths.

Scout officials said membership is one of several factors that influence donations from United Way, the Scouts’ single biggest contributor. United Way contributed about $1 million in 1990.

Membership is not “the overriding factor in determining the allocation, but it is a factor,” said Larry Bryant, a spokesman for United Way of Greater Los Angeles.

The local Scouts chapter called for the national organization’s help because it wanted a “disinterested party” to investigate the allegations, Tibor and Keane confirmed.

Madrid, however, questioned the objectivity of the audit.

“I think they’ll just cover it up,” he said, advocating instead an independent, outside audit.

KCOP Channel 13, in a Friday broadcast, was the first to report that the Boy Scouts of America is investigating the Los Angeles council.