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Goldstein: LA Housing Authority Commissioner Under Investigation

LOS ANGELES (CBS) — In a new CBS 2 Investigation, David Goldstein reports on allegations involving an LA Housing Authority Commissioner involving a possible conflict of interest with her position. 

Beatriz Stotzer is the chairperson of the Board of Commissioners of the LA Housing Authority.

A public agency that controls a $1 billion budget. Mostly federal taxpayer money used for public housing and low income subsidies.

CBS 2 News has learned the city attorney's office is looking into whether Stotzer violated the authority's conflict of interest policy. It's something the commissioner doesn't want to talk about.

"Is there an inquiry ongoing?" Goldstein asked Stotzer.

"I have no comment," the Councillor replied.

The investigation centers on these checks — obtained by CBS 2 News — they're issued by the same housing authority Stotzer oversees and are for $400 - $600/month.

We found rent checks totaling $18,778 in federal taxpayer money over the past two years. There could be more. The checks are made out to a company called West Valley Hart. To subsidize low income housing in this apartment building in Canoga Park.

One of the general partners of West Valley Hart is West Valley Community Development Corporation. Which, according to the IRS, lists Beatriz Stotzer as president.

The authority's conflict of interest policy states, "No employee shall knowingly own property that is ...subsidized by the authority" though it's unclear if commissioners fall under that policy.

Is this a conflict of interest?

"I have no coment and I look forward to the audit that the controller is going to be conducting on behalf of the agency and the commission. I have no other comment regarding that," said Stotzer

City Controller Wendy Gruel "is" conducting an audit of the Housing Authority, but so far only the travel expenditures. That was prompted by our investigation last February. Now she hope to conduct a complete audit — which could answer the question of conflict of interest.

"I think that's what an audit would look at. How do they deal with conflicts of interest? What kind of instruction has been given to commissioners on what they can and cannot do," said Gruel.

Stotzer's lawyer claims his client notified the city attorney and there is no conflict because the building is not in her name.

"She's disclosed things to the city attorney. I don't think she's hiding anything and the fact that I'm giving you this interview today indicates she's not hiding anything," her attorney said.

But Bob Stern, the former chief counsel for the California Fair Political Practices Commission, says even the appearance of a conflict could be a problem.
When you're a commissioner of housing you want to make sure that you have no legal conflicts or even ethical conflicts and there are some questions being raised here.

It's right now in the hands of the city attorney. But because that agency also advises the Housing Authority on legal matters, there could be a conflict. Ultimately, it could be decided by the City's Ethics Commission, or the Attorney General's Office.

David Goldstein, CBS 2 News

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