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Connell Gives Up Donor Funds

The former state controller's action puts pressure on L.A.-area politicians to return donations also found to have been laundered.

January 13, 2006|Patrick McGreevy | Times Staff Writer

Former state Controller Kathleen Connell has complied with a demand to give up $22,000 in political contributions to her 2001 Los Angeles mayoral campaign because the donors have admitted the money was laundered.

The action increases pressure on other L.A. politicians who have received laundered contributions -- including Mayor Antonio Villaraigosa, City Atty. Rocky Delgadillo and Councilman Jack Weiss -- to write checks to the state or city.

"Any contributions found to be coming from laundered funds should be given to the state," said Kathay Feng, executive director of California Common Cause. "It shows that the elected official does care about transparency and wants clean hands."

At least 19 contributions received by Connell's campaign committees were made in the name of someone other than the true source of the money, according to the contributors, who admitted that the money was donated in a scheme hatched with an executive of Casden Properties Inc.

Connell's decision to write a check to the state general fund at the insistence of the state Fair Political Practices Commission puts the spotlight on contributions that went to Villaraigosa, Delgadillo and others that were laundered in the same scheme.

Most said they would consider returning funds if formally notified that the contributions were laundered.

The state Political Reform Act requires that when a campaign committee receives a contribution made in the name of another person -- an act known as political money-laundering -- it must pay the amount to the state general fund, said John M. Applebaum, chief of enforcement for the FPPC.

The City Charter has a similar provision.

A memo to the state commission this week from Applebaum disclosed that Connell wrote a check to the state after receiving a letter of demand from his office.

"We have no evidence to suggest these committees were aware they had received laundered contributions or had otherwise violated the act," Applebaum wrote.

The same finding -- that there was no evidence candidates knew money they received had been laundered -- was reached in all the city cases.

The Los Angeles Ethics Commission last year won settlements from John Archibald, a vice president for Casden Properties, and more than two dozen people, including subcontractors, their employees, relatives and associates.

The individuals admitted to a scheme in which subcontractors reimbursed the employees, relatives and friends for 19 contributions made to Connell's mayoral campaign and to the campaign committees of Villaraigosa, Delgadillo, Weiss, Councilwoman Wendy Greuel and others.

Villaraigosa's 2003 council campaign received $2,000 in contributions that were later found to be from other sources.

Stephen Kaufman, the mayor's campaign attorney, said, "We are reviewing the state and city laws to determine whether they apply to these contributions, and if so, we will promptly reimburse the general fund."

Weiss' campaign received $5,000 in laundered contributions, Greuel $3,500, Councilman Bernard C. Parks $2,500, Councilman Tony Cardenas $2,500 and Delgadillo $2,000, according to documents released by the Ethics Commission in cases in which settlements were reached.

Weiss refused to return contributions to Casden subcontractors when called on to do so in the last election by challenger David T. Vahedi.

Vahedi said Thursday that Weiss should not only give up the laundered contributions but also the city matching funds he received for them.

Contributions from individuals were matched by the city dollar for dollar.

"If the money was given illegally, then the matching funds should not have been given to him in the first place," Vahedi said.

FPPC officials declined to say whether demand letters similar to the one Connell received have been sent to other L.A.-area politicians.

Delgadillo has not received a letter from the state commission identifying funds that were laundered and that should be returned, said campaign advisor Roger Salazar.

"We would certainly be responsive if we did get such a letter," Salazar said.

Greuel also said she was not aware of which contributions might have been laundered and has not been put on notice by the state commission.

"I will comply fully with any request of the Fair Political Practices Commission," Greuel said.

Weiss also has not given up the contributions identified in city Ethics Commission documents as having been laundered.

"If Jack receives a communication from a regulatory agency, he will read it and consider what to do with it," said Larry Levine, a campaign advisor to Weiss.

No politicians for L.A. city office have been implicated for having knowledge that contributions were laundered, though all the donations have been listed for months on the website of the city Ethics Commission.

Fred Woocher, an attorney for Connell, said she reopened her city committee to pay the state, but he said some of the other politicians may be able to argue that they have closed their committees and therefore do not have any money to give up.

The commission is wrapping up the last cases in the Casden Properties investigation and plans to officially notify all city officials.

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