L.A. County to pause some payouts amid investigations into $4-billion sex abuse settlement
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Los Angeles County will halt some payments from its $4-billion sex abuse settlement, leaving many plaintiffs on edge as prosecutors ramp up an investigation into allegations of fraud.L.A.County agreed last spring to the record payout to settle a flood of lawsuits from people who said they’d been sexually abused by staff in government-run foster homes and juvenile camps.
Many attorneys had told their clients they could expect the first tranche of money to start flowing this month.But the county’s acting chief executive officer, Joseph M.Nicchitta, said Thursday that the county would “pause all payments” for unvetted claims after a request by Dist.
Atty.Nathan Hochman.
These are claims that have been flagged as requiring a “higher level of scrutiny,” according to a joint report submitted Thursday by attorneys in the settlement.The district attorney announced he would investigate the historic settlement after reporting by The Times that found some plaintiffs who said they were paid to sue.Investigators have found “a significant number of cases where we believe there is potential fraud,” according to a spokesperson for the prosecutor’s office.
The State Bar is spearheading a separate inquiry into fraud allegations.On Jan.9, Hochman formally requested the county pause the distribution of funds for at least six months, which he said would give his office “a reasonable opportunity to complete critical investigative steps.”“Premature disbursement of settlement funds poses a substantial risk of interfering with the investigation by complicating witness cooperation, obscuring financial trails, and impairing my office’s ability to identify and prosecute fraudulent activity,” Hochman wrote in a letter to Andy Baum, the county’s main outside attorney working on the settlement.Plaintiff lawyers argued the county was required to turn over money by the end of th...