Former Baldwin Park's Housing Director Accuses Finance Director, Rose Tam, of Laundering $7 Million of Housing Funds; Lawsuit Filed.

Rose Tam, Finance Director

A lawsuit filed by Baldwin Park's former housing manager accuses current Finance Director, Hong Tam

(also known as Rose Tam and Hong Fang) of laundering $7 million of state and federal housing funds meant for low income residents of the City, which she allegedly co-mingled with other funds. (The City has refused to acknowledge the lawsuit in its agendas in violation of the Brown Act. For your information, the case no. is 20STCV17682).

Regarding the City's finances, Ruelas' lawsuit suggests that Tam is responsible for taking funds that are meant to help housing for the poor, and instead spent it on the raises of the City Council and administrators.

Ruelas claims of financial misappropriation are consistent with Baldwin Park's adopted 2019-2020 budget. In it, the City budgeted $77,134.20 for its elected officials for only having to show up to two meetings a month. That's over $6427 to show up to two meetings a month.

In five years, the finance department, where Tam works, has increased its budget from $239,722 to $385,671. This is a 61% increase. 

In five years, the CEO office increased its budget from $352,441 to $479,149. This is a 36% increase. By raises alone, it's clear who the City Council likes.

A recent review of current city official and administrators verifies the allegation that the City steals from the housing fund to give itself raises. According to  California Transparency for the year of 2019 - here's what Baldwin Park's officials and administrators brought home:

Mayor Lozano and the City Council Members made $50,678.68. (This is to show up to two meetings a month.)

Shannon Yauchzee made $374,100.04. But when it came to disclosing his paychecks, Yauchzee refused to disclose his pay 

Rose Tam, Finance Director made $300,748.95. 

Manuel Carrillo Jr., Parks and Recreation Director made $293,464.25.

Samuel Gutierrez, Public Works Director made $248,940.30. 

Benjamin Martinez, Community Development Director made $240,487.02.

Furthermore, Ruelas' accusation and lawsuit comes at a time when the City of Baldwin Park has failed its audit. According to the State Controller report, the City has “serious'' lack of internal financial control measures, “resulting in poor contracting and accounting practices and a questionable pay increase for a top city official.'' Almost 50% of the city's internal controls are not functioning. In other words, city officials and administrators are treating the city's bank account like their own personal one.

This information was revealed to local activist, forty-two year-Baldwin-Park-resident, father, grandfather, and retired blood technician, John Rios. Rios had to mortgage his house to support his two adult children and two grandchildren. This is because his ex-wife was diagnosed with multiple sclerosis. 

Regarding the City's housing vouchers, Rios was told that there was no more money to aid him on his mortgage from the housing fund, even though he would be in the class of people who qualify. According to Rios, his children and grandchildren have it worse financially because of the Covid-19 pandemic, and without his support, they would be on the streets. Upon hearing about the housing misappropriation, Rios stated:

"If you're in government, city council, you have to be honest. I can't stand people who lie to the community. They're using money that should be used to help the community and instead, use it for their own benefit. I throw in their face at council meetings that they're robbing us. That's why they want to stay in office; so, they could keep stealing from the community. Really, the Attorney General of the state and the feds really need to get involved."

At the last council meeting, the City Council deferred on voting whether to outsource the city jail or lay off more staff because an election is on the horizon. But given that the management and city officials are eating up a huge amounts of taxpayer money - it won't be long until city services are cut, if not gone altogether. 

As Nobel Laurete, Aleksandr Solzhenitsyn, said in a 2006 interview regarding the collapse of the Soviet Union, "[T]he most unprincipled thieves enriched themselves through the unimpeded plundering of the [People's] property".