Federal probe focuses on wife of L.A. City Atty. Delgadillo
Federal authorities investigating Los Angeles City Atty. Rocky Delgadillo and his wife are seeking information about her consulting business and taxes, according to sources familiar with the inquiry.
Federal prosecutors and FBI agents have expressed interest in at least two firms that hired Michelle Delgadillo -- California Litho-Arts, a printing company based in Los Angeles, and Diane Castano-Sallee & Associates, according to sources familiar with the case who spoke on condition of anonymity because they were not authorized to discuss the ongoing investigation.
A separate source, who also spoke on condition of anonymity, said one area of federal interest is whether Delgadillo's wife paid taxes on the income earned from her business.
The president of California Litho-Arts, Helen Mars, recently told The Times that her firm had received a subpoena.
California Litho-Arts had city contracts totaling $36,945 between 1993 and 2002, with the vast majority of those contracts expiring before Rocky Delgadillo became city attorney in 2001.
Castano-Sallee's business has received more than $350,000 in contracts with the city attorney from 2001 to 2004. Two weeks ago, her husband told The Times that Castano-Sallee had not received a federal subpoena. Asked Tuesday whether his quote was still accurate, he said: "Don't use that."
Agents and prosecutors met with City Controller Laura Chick, who audits city departments and agencies, two weeks ago to talk about Delgadillo, Chick said Tuesday.
Delgadillo said that neither he nor his wife had been contacted by authorities or knew anything about an investigation, according to his spokesman, Nick Velasquez. Delgadillo knows of no allegation of wrongdoing and said he would cooperate with any inquiry, Velasquez said.
Last year, The Times reported Michelle Delgadillo's home-based consulting business, C.R.D. Inc., had failed to file state tax returns and operated for years without a required city tax registration certificate. The state Franchise Tax Board suspended the business in 2005 for not filing returns.
Michelle Delgadillo also made headlines when The Times revealed that she had dented her husband's city car while driving with a suspended license.
Velasquez says a "political agenda" lies behind any allegations made against Delgadillo, who is said to be interested in seeking statewide office when his term expires next year.
