Audit: California City Misspent Affordable House Money

By Staff | October 20, 2010 | 6:03 PM EDT

(AP) - The California controller's office says officials in the scandal-plagued city of Bell took more than $1 million in money earmarked for affordable housing and street repair and used it to give themselves excessive salaries and other generous perks.

State Controller John Chiang said Wednesday at least $1.2 million was wrongly diverted into what he called a "self-indulgent slush fund."

Chiang's office launched an audit of Bell's books three months ago, after the Los Angeles Times disclosed that several city officials were paying themselves exorbitant salaries.

He has reported previously that Bell officials mismanaged more than $50 million in bond money and levied millions of dollars in illegal taxes.

Eight current and former city officials have been charged with looting city funds.