No. 2 Official at L.A. Housing Authority Fired

An executive with the Los Angeles Housing Authority was fired Thursday as a result of an investigation into alleged financial irregularities, and evidence in the case has been turned over to the U.S. attorney’s office for possible prosecution, city officials said.

The firing of Assistant Executive Director Lucille Loyce, the No. 2 administrator, came after investigators questioned as much as $1 million in agency spending, including billings that appeared to have been for personal expenses, according to sources familiar with the probe.

Deputy Mayor Renata Simril said the dismissal came three weeks after the city got a complaint from an employee alleging misuse of agency resources.

“The tip was about financial irregularities by this one person,” Simril said of Loyce. “At the end of the three-week paper trail investigation, we had enough grounds to terminate her.”

The mayor’s office conducted the investigation jointly with the Housing Authority and city prosecutors, said Matt Szabo, a spokesman for City Atty. Rocky Delgadillo.

“This office has conducted an initial investigation and has referred the matter to the U.S. attorney for further investigation,” Szabo said. He noted that the Housing Authority, which oversees public housing projects and administers federal housing subsidies, is largely funded with federal money, which is one reason that the investigation was submitted to the U.S. attorney.

As Loyce, who has worked at the Housing Authority for 12 years, was escorted from the building on Wilshire Boulevard, agency officials took financial records from her office and the management offices at the Jordan Downs and Pueblo del Rio housing projects, Simril said.

Loyce could not be reached for comment.

The Times reported last year that federal prosecutors and the inspector general for the U.S. Department of Housing and Urban Development were looking into allegations of financial irregularities at the agency.

In July, Loyce and other Housing Authority officials announced that they had given federal prosecutors evidence that more than $281,000 in government money had been embezzled by a former employee and members of elected resident boards at city housing projects.

Then-Executive Director Donald Smith said at the time that records showed money meant for the poor having been spent on unauthorized stipends, clothes, travel and cars.

However, some former workers have alleged to federal officials that some agency managers accepted cash payments from agency contractors, manipulated bids on contracts and tolerated double billing by one consultant. That inquiry is pending.

City officials confirmed Thursday that the new investigation includes a look into contracts provided to resident management corporations overseen by Loyce. Among the spending under investigation are a down payment on a condominium, payments on a Mercedes-Benz and other personal expenses, one source said.

Meanwhile, federal auditors are wrapping up a review of how the Housing Authority handled more than $75 million in federal funds in recent years, said Judy Luther, the new executive director of the agency.

Smith resigned last month.