LA Democrats Advance Charter Reform to Abolish City Controller’s Office Amid Massive Fraud Scandals

In a move that has ignited fierce backlash, the Los Angeles Charter Reform Commission voted 9-2 on Thursday to advance a proposal that would effectively eliminate the independent City Controller’s office, shifting its core functions—including audits, accounting, payments, revenue forecasting, and fraud investigations—to a new Chief Financial Officer (CFO) appointed by Mayor Karen Bass and accountable to the City Council. This reform, framed by supporters as a consolidation of financial operations to address the city’s ongoing budget crisis, comes just weeks after Controller Kenneth Mejia’s office played a pivotal role in exposing a $23 million homelessness funding fraud scheme, leading to the arrest of a Westwood man charged with defrauding taxpayer dollars intended for homeless services. 

Mejia, in a video posted to social media on Thursday, expressed shock at the proposal, stating he learned of it only two hours before the commission’s meeting. “Everyone, I am tired of my office being under attack,” Mejia said in the video, which has since garnered widespread attention. “There is a proposal being presented at the Charter Reform Commission that would eliminate our accounting, our payment functions, revenue forecasting, our audits and fraud, waste and abuse [investigations], and essentially give it to the mayor and city council through the creation of a new CFO.” He urged Angelenos to rally in support of alternative reforms that would empower his office, including designating the Controller as the city’s CFO and granting independent budgeting to shield it from political retaliation. 

WOAH 🚨 Los Angeles Democrats are bringing legislation to eliminate the office in charge of audits, fraud, waste and abuse

This is the office that has been exposing homeless NGO fraud leading to arrests, now Democrats are eliminating it

Los Angeles Controller Kenneth Mejia “I… pic.twitter.com/OlbekZQ6rH

— Wall Street Apes (@WallStreetApes) February 27, 2026

The Charter Reform Commission, tasked with overhauling the city’s governing document amid fiscal strains—including a $1 billion budget deficit that led to 27 position cuts in Mejia’s office last year—has been debating these changes for months. Commissioners Carla Fuentes and Michael Yap opposed the motion, but the majority approved language that would replace the elected Controller’s role with an appointed CFO, potentially stripping away independent oversight. If adopted by the City Council and approved by voters, the reform could centralize financial authority under the mayor, raising concerns about reduced accountability in a city plagued by scandals.

This push arrives against a backdrop of rampant waste, fraud, and abuse in Los Angeles, as extensively covered by the California Globe. In April 2025, U.S. Attorney Bill Essayli announced the formation of the Homelessness Fraud and Corruption Task Force to probe misuse of billions in homelessness funds, highlighting Los Angeles County’s disproportionate role in statewide scandals. The Globe reported on specific cases, such as the $23 million fraud involving fake invoices and empty shelters, which Mejia’s audits helped uncover, triggering federal arrests. Broader investigations revealed $3.5 billion in suspected hospice and home-health fraud centered in Los Angeles, as noted by Centers for Medicare and Medicaid Services Administrator Dr. Mehmet Oz. 

Congressman Kevin Kiley (R-CA) has amplified these issues, requesting a Government Accountability Office (GAO) report in February 2026 to quantify California’s staggering fraud since 2016, estimating billions across sectors like housing and healthcare. Kiley cited a $50 million homelessness scheme in Los Angeles as emblematic of the problem, alongside $370 million diverted from the California Cannabis Tax Fund for non-intended purposes like “social justice” grants unrelated to substance abuse prevention.

The Globe’s coverage of Governor Gavin Newsom’s administration has further exposed systemic failures, including $24 billion in homelessness spending from 2019-2024 yielding no measurable results, and $8.6 billion in COVID-era relief fraud. 

Vice President JD Vance, leading a federal anti-fraud task force in California, has signaled intensified scrutiny of Los Angeles’ homelessness programs.

As the proposal heads to the City Council, critics argue it undermines the very watchdog mechanisms that have begun to hold officials accountable. Mejia’s office has proposed six counter-reforms via its website, including expanded audit powers over all city tax dollars, to fulfill the Controller’s role as the “people’s watchdog.” The battle over LA’s charter underscores deeper tensions in California’s largest city, where fiscal mismanagement continues to fuel calls for federal intervention.