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June 13, 1996

Although six past or present county officials were formally charged with wrongdoing in connection with the bankruptcy, their cases, for the most part, are still unresolved. Three of the supervisors in office at the time of the bankruptcy either retired or resigned.

Supervisor Roger R. Stanton

Stanton, 58, chairman of the Board of Supervisors, was charged last December by the grand jury with "willful misconduct" for failing "to safeguard the financial health of the county." The grand jury charged that Stanton failed to properly oversee the operations of then-Treasurer-Tax Collector Robert L. Citron and others, whose risky investments lost $1.64 billion and drove the county into bankruptcy.

Stanton was ordered to stand trial in Superior Court in September, but the 4th District Court of Appeals stayed the proceedings, ordering that the charges be dismissed unless the court received compelling reasons why the trial should proceed.

Supervisor William G. Steiner

Steiner, 58, was charged by the grand jury with bankruptcy-related misconduct for failing to adequately supervise Citron and others in the county whose actions led to the massive investment losses.

For the Record
Los Angeles Times Tuesday June 25, 1996 Orange County Edition Part A Page 3 Metro Desk 2 inches; 60 words Type of Material: Correction
Steve E. Lewis--A June 13 graphic incorrectly stated that Auditor-Controller Steve E. Lewis was charged by the county Grand Jury with willful misconduct because he knew the county only had $500 million available to repay $750 million it borrowed in 1993-94. In fact, Lewis was charged because he "failed to make adequate inquiry, review, and ascertain the amount of revenues available for the repayment of the indebtedness."

Like Stanton, Steiner was ordered to stand trial in September until the appellate court instructed the judge overseeing his case to provide compelling reasons why he should go on trial or to dismiss the case.

Auditor Steve E. Lewis

Lewis, 53, was charged by the grand jury with willful misconduct for failing to "accurately compute, compile, calculate and report the cash-flow projections for the county" and because he "willfully approved of . . . and encouraged" Orange County to borrow $750 million knowing the county would not have the means to pay it all back.

Lewis maintains that he did nothing wrong and that he alerted the supervisors and others to the county's inappropriate investment practices in a 1993 report. His trial is scheduled for September.

Robert L. Citron

Former longtime treasurer Citron, 71, the only public official connected to the bankruptcy to admit any guilt in the financial fiasco, pleaded guilty in April 1995 to six felony counts of securities fraud and misappropriation of interest from the county investment pool he once managed.

Citron faces up to 14 years in prison and $7 million in fines. A Probation Department report recommended that Citron receive a sentence of probation and less than a year in County Jail. He is scheduled to be sentenced in October or November.

Matthew Raabe

Raabe, 39, Citron's top assistant, was indicted by the grand jury in May 1995 on six felony counts of securities fraud and misappropriation of funds. Raabe portrays himself as an unsophisticated finance officer who had little idea how poorly the investment fund was performing.

Prosecutors offered Raabe the same deal as Citron, but he declined to plead guilty and is scheduled to stand trial in September.

Ronald S. Rubino

Former county budget director Rubino, 44, was the only other official indicted by the grand jury. He was charged with two felony counts of aiding and abetting Citron in a scheme to illegally siphon off more than $60 million in interest from the investment pool to the county's general fund.

Rubino, who left his $95,500-a-year job with the county in April 1994 to enter the municipal finance industry, is widely credited with developing the plan to divert interest from the accounts of other pool investors to replace county funds lost to state cutbacks. He faces up to nine years in prison if convicted, and is scheduled to stand trial in August.

* Supervisor Chairman Thomas F. Riley, 83, retired.

* Supervisor Gaddi H. Vasquez, 41, resigned; now a beat cop in Orange.

* Supervisor Harriett M. Wieder, 75, retired.

* County Counsel Terry C. Andrus, 51, resigned but retained by county.

* County Administrative Officer Ernie Schneider, 49, fired. Working for Hunsaker & Associates in Irvine.

* Finance Director Eileen T. Walsh, 45, demoted, suing the county.

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