|The following is based on the canceled Fallout movie and has not been confirmed by canon sources.|
When the Master could not afford to buy into a vault, created the F.E.V. to adapt fallout survivors like himself to hostile radiation conditions. The formula worked and superhuman side effects were a pleasant surprise. Unfortunately, the mutants are sterile, and so they need humans to sustain their numbers.
This is why the Master turned the LA basin into a jungle with stolen G.E.C.K.s. LA is just a cattle field for humans, an inviting oasis amidst the wasteland. The Master had been testing all sorts of genetic combinations for years, but Hero and Female Officer represent his last chance at creating pure bloodlines and a fertile, mutated Adam and Eve.
The Master is in charge of the mutants, but other tiers in the structure are unknown. Scholar seemingly becomes important for a time, but he is soon killed in the battle at Vault 13. They also had an agreement with Dekker, but what exactly is unknown.