Ombuds report confirms concerns of fraud in programs flagged by DCHS audit

May 19, 2026

The King County Office of the Ombuds on Tuesday released an independent review of 19 community organizations that were subject to the 2025 Audit of the Department of Community and Human Services, and identified nearly $700,000 in questionable costs across 16 of the 19 community partners reviewed. Concerns of these programs have grown since King County Councilmember Reagan Dunn first flagged them for audit in 2023.

“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 said. “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 report, prepared by Clark Nuber, P.S., reviewed 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.

According to the Ombuds Office, waste, fraud, or abuse likely occurred in some cases and cannot be ruled out in others without additional investigation. The Ombuds Office has stated that it will refer specific observations indicating possible fraud, forgery, or attempted theft of funds to law enforcement.

The review found $690,617 in questioned costs, including costs related to stipends paid outside approved activities, unsupported cash withdrawals, and costs incurred outside contract periods. The report also identified potentially altered documents, possible conflicts of interest, missing or insufficient documentation, and poor financial management in DCHS community partner contracts.

Dunn first raised concerns about King County-funded juvenile diversion and community-based programs in 2023, when he called for a state audit of those programs. In 2024, Dunn followed up by requesting that the King County Auditor conduct a financial and performance audit of Restorative Community Pathways.

That audit was completed in 2025 and identified serious problems in DCHS contract oversight and financial controls. During the audit process, the King County Auditor referred additional compliance concerns involving community partner contracts for further review. After Dunn called for an independent investigation, that review was referred to the Office of the Ombuds, which commissioned the report released today.

In response to the original DCHS audit, the King County Council unanimously passed Dunn’s DCHS grant oversight reform legislation, which requires stronger financial controls, risk assessments, contractor training, monitoring, and reporting requirements for taxpayer-funded grants. Dunn is now working with Council colleagues on legislation to establish an Inspector General Division to help prevent, detect, and respond to fraud, waste, and abuse in County government. In addition, Dunn has introduced ethics reform legislation to strengthen conflict-of-interest rules, broaden the relationships covered by County ethics standards, and require conflicts to be resolved — not merely disclosed.

“Executive Zahilay also deserves tremendous credit for working with me to reform these processes and restore taxpayer trust in our government,” Dunn said. “There is still much more to do, and I look forward to working with him and my Council colleagues to strengthen oversight, recover public funds, and ensure King County has the tools it needs to protect taxpayer dollars.”