‘Waste, fraud, or abuse likely occurred’: King County review finds nearly $700K in questionable costs across youth programs

The King County Office of the Ombuds, an independent organization within King County government, found nearly $700,000 in questionable costs across 16 of the 19 community partners reviewed as part of a 2025 audit into the King County Department of Community and Human Services (DCHS).

“Waste, fraud, or abuse likely occurred in some cases and cannot be ruled out in others without additional investigation,” a news release from King County Councilmember Reagan Dunn stated Tuesday.

The report, prepared by Bellevue accounting firm Clark Nuber PS, examined compliance concerns related to contracts with community partners in four DCHS youth and diversion programs: Family Intervention and Restorative Services, Liberation and Healing from Systemic Racism, Restorative Community Pathways, and Stopping the School-to-Prison Pipeline.

The review found $690,617 in questionable costs related to stipends paid outside approved activities, unsupported cash withdrawals, and costs incurred outside contract periods. However, a DCHS spokesperson told MyNorthwest that the department had already withheld over $370,000 of the questionable costs, meaning the improper payments actually disbursed totaled roughly $320,000.

The spokesperson also wanted to note that not all $320,000 is potential fraud.

“The report doesn’t specify what they consider fraud, but states where there is suspected fraud, they will refer it to law enforcement,” the spokesperson stated. “Other payments in question may only need further documentation to be verified, meaning, it’s not fraud.”

Dunn first flagged King County youth programs in 2023

Dunn noted he first flagged the programs in 2023 and called for a state audit. Dunn then followed up in 2024 by requesting the King County Auditor conduct a financial and performance audit of Restorative Community Pathways. The audit, completed in 2025, highlighted issues in DCHS contract oversight and financial controls.

During that audit, even more red flags surfaced, leading Dunn to push for an independent investigation. The review landed with the Office of the Ombuds, which commissioned the report released Tuesday.

“This report confirms exactly what I was afraid we’d find when I started calling for an audit all the way back in 2023,” Dunn stated via the release. “These programs can’t just be left to operate on their honor — they need oversight and regular scrutiny to ensure taxpayer dollars actually reach the people they are intended to help.”

The Ombuds Office said it will refer specific observations indicating possible fraud, forgery, or attempted theft of funds to law enforcement, according to the news release.

Seattle Times investigation reveals alleged fraud in DCHS-funded programs

A Seattle Times investigation published in March revealed alleged fraud among DCHS-funded contractors, raising further questions about how King County manages taxpayer dollars.

The Seattle Times explained that contractors would request money and receive it without any oversight into whether the funds were actually being used as claimed. For example, Gerry Hill, a licensed cosmetologist, signed a three-year, $470,000 agreement with the county to provide job training opportunities for young adults of color.

She registered her business, Your Pretty Perfect, and said it had community outreach staff and a long list of workshops lined up. However, many of the people named as partners told The Seattle Times they never worked with Hill. In her report to the county, Hill failed to provide the required information, writing “done,” “not yet,” or “anytime” in fields that asked for data, such as the number of young adults she worked with.

King County executive calls situation a ‘systemic failure’

King County Executive Girmay Zahilay called the overall issue a “systemic failure” on “The Gee and Ursula Show” on KIRO Newsradio in April.

“The infrastructure needed to hold those dollars and these systems accountable: The oversight, the financial controls, the boots on the ground, auditing those types of systems did not keep pace with the growth of those resources,” Zahilay said. “So while I could say that there are just bad employees or bad actors, I think really what the heart of this is, is that leadership did not put enough resources into oversight and financial controls to keep pace with the growth of the resources that are needed when you’re partnering with organizations that might not have the same kind of technical capacity to deliver in a more accountable way.”

Zahilay said a new internal audit director for King County had been hired, tasked with proactively assessing risk and identifying issues across all departments. Additionally, he created a sub-cabinet focused on accountability and transparency.

“All of my top department directors will meet very regularly to identify these types of risks and eliminate them proactively, rather than waiting for the independent auditor to give us a bad grade on our report card,” Zahilay said. “We’re going to start from the bottom up and say nothing. Everything’s on the table. We’re going to analyze everything. We’re going to find programs that are not producing the results.”

King County Council passes DCHS oversight legislation

In response to the original audit, the King County Council passed Dunn’s DCHS grant oversight reform legislation, requiring stronger financial controls, risk assessments, contractor training, monitoring, and reporting requirements for taxpayer-funded grants.

Dunn is also working to establish an Inspector General Division to help prevent, detect, and respond to fraud, waste, and abuse in King County’s government.

The DCHS spokesperson noted that over the last year, the department has made significant progress in strengthening internal controls and fiscal oversight, as outlined in the King County Auditor’s April report.

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