A special audit team is recommending that law enforcement investigate officials and employees of the Montebello Unified School District for potential fraud as well as misappropriation of funds and assets.

The recommendation, made public Tuesday, is the latest blow to one of the larger school districts in Los Angeles County and one that faces serious financial problems.

The audit’s findings are based on an extensive review by the state’s Fiscal Crisis and Management Assistance Team, which was brought in under the supervision of county education officials.

Late last year, the state auditor — a different entity — had looked at Montebello and also found problems. That earlier review concluded that “poor fiscal oversight” had put the southeast L.A. County school system of 28,000 students “in danger of financial insolvency.”

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