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LADWP Creates Oversight Office to Rebuild Customer Trust

Fallout from a botched rollout of a new billing system has led the Los Angeles Department of Water and Power to create an Office of Inspector General in an effort to bolster accountability and transparency.

News reports said the announcement comes two months after FBI agents raided the utility’s downtown headquarters and City Hall East.

In a statement, Los Angeles Mayor Garcetti said, “An inspector general at the DWP will help us make certain that the organization is always working to uphold the highest standards of integrity and improve customer confidence.”

Reports said that FBI agents served search warrants at the DWP and City Attorney’s Office in July as part of a probe into the city’s handling of litigation and a settlement over a 2013 billing system rollout.

Thousands of customers received inaccurate bills. The problems prompted a class-action lawsuit that led to a settlement requiring the utility to reimburse customers roughly $67 million.

The city and the utility sued PricewaterhouseCoopers over its handling of the system’s rollout. For its part, PricewaterhouseCoopers earlier in 2019 raised questions over the city’s relationship with an outside attorney it hired to handle the litigation against the company. The firm said the attorney was hired as a legal consultant in the city’s lawsuit against Pricewaterhouse Coopers while he also served as legal counsel suing the city on behalf of a customer in the class-action lawsuit.

The newly created inspector general role will be part of the utility’s senior leadership team, providing review and oversight of contracting matters, whistleblower complaints, ethics and other internal policies. The office will have the power to initiate investigations and oversee the department’s Internal Audit Division, Special Investigations Unit and ethics compliance staff.

DWP Interim General Manager Martin Adams said in a statement that the utility is committed to ensuring actions are proper and transparent.

“The hiring of an inspector general will give us a person whose sole job is to make certain we have adequate checks and balances and stronger internal oversight,” Adams said. “We will do this right and in a way that works successfully within the DWP and city charter framework.”

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