Orange County taxpayers, including Newport Beach residents, may have lost millions of dollars during the pandemic because county officials ignored conflict-of-interest warnings and paid vendors without verifying work was done, according to a forensic audit released Wednesday, Aug. 12.

The Phase 2 report by independent auditing firm Weaver examined 681 contracts totaling roughly $1.7 billion. It found eight contracts worth $10.7 million that were executed months after work had already begun, more than $500,000 in grant funds with only 46% documented and thousands of COVID tests that may have been double-billed to the county and insurers simultaneously.

The findings center on decisions made under former OC Supervisor Andrew Do, who was sentenced to five years in federal prison in June 2025 after admitting he accepted more than $550,000 in bribes to steer over $10 million in COVID relief funds to the Viet America Society, where his daughter Rhiannon Do worked.

Conflict warnings dismissed

Auditors found that former OC Health Care Agency Director Dr. Clayton Chau directed staff to use Warner Wellness, a nonprofit headed by Rhiannon Do, as a subcontractor for OCAPICA even though that primary contractor had no prior relationship with the organization and raised concerns about its qualifications.

When HCA leadership flagged the conflict in March 2023, Chau dismissed it. He told staff that "Supervisor Do was an attorney and he would know if there was a conflict" and verbally reprimanded a staff member for raising the concern, according to the audit.

Former County CEO Frank Kim learned of the complaint but did not notify County Counsel. Instead, he contacted Do's chief of staff Chris Wangsaporn, who falsely told Kim that Rhiannon Do was no longer affiliated with Warner Wellness. Auditors noted Kim "felt lied to" when he later learned she was still employed there.

Backdated contracts, spotty records

The county paid over $3.4 million to COVID testing contractor 360 Health Clinic. Auditors confirmed about 96% of the tests were performed but flagged 2,646 tests totaling $132,300 as unverifiable, including 1,574 that appeared double-billed. The company told auditors it "no longer has the operational staff to compile this information" needed to determine whether it also collected insurance payments for the same tests.

Eight contracts totaling $10.7 million were not signed until months after work began. Mercy Pharmacy started providing vaccination services in early January 2021 but its contract was not executed until April 29, 2021. Auditors found Chau "was friends with Mercy Pharmacy and wanted to use them because they do good work."

Bridgecreek Realty Investment Corp. spent over $500,000 in county funds but documented only 46% of expenditures. Among the spending: $35,222 to HD Construction for a $15,000 folding gate, an $11,000 gas grill and other equipment that ended up at a restaurant rather than being used as outdoor dining infrastructure. HD Construction was run by Peter Pham, who faces more than 15 federal charges and is currently a fugitive.

Newport Beach supervisor's role

District 5 Supervisor Katrina Foley, who represents Newport Beach and sits on the county's Audit Oversight Committee, praised Chau publicly in May 2021, calling his pandemic leadership "exceptional." By November 2021, Foley and Supervisor Don Wagner were publicly raising concerns about sole-source contracts and lack of documentation from Chau's agency.

Foley told ABC7 in March, when the Phase 1 audit was released, that the county had recovered $3.7 million. "We're going to keep pursuing those claims and try to get the money back for the taxpayers," she said at the time. No Phase 2-specific statement from Foley's office was available as of Wednesday.

Calls for prosecution

Supervisor Janet Nguyen, who replaced Do in District 1, said the county's internal auditor has already referred Chau and several businesses to the District Attorney for possible prosecution. The DA's office has not confirmed those referrals.

As Voice of OC reported Wednesday, Nguyen wrote that taxpayers were "scammed" during the most difficult time of their lives and that no one has been held accountable.

Dr. Chau did not respond to requests for comment. Mercy Pharmacy, Bridgecreek CEO Frank Jao and Do's attorney also did not respond or declined comment.

Phases 3 and 4 of the audit will examine an additional 1,726 contracts worth roughly $2.07 billion. No presentation date has been announced.