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California prosecutors accuse Bell leaders of plotting to enrich themselves

The attorney general's office files a lawsuit aimed at limiting officials' pensions, forcing them to refund hundreds of thousands of dollars in back salaries and ousting three City Council members.

September 16, 2010|By Jeff Gottlieb, Ruben Vives and Richard Winton, Los Angeles Times

State prosecutors accused Bell leaders of secretly plotting to enrich themselves and conceal their lucrative compensation, filing a suit Wednesday aimed at limiting the officials' pensions, forcing them to refund hundreds of thousands of dollars in back salaries and removing three City Council members from office.

The allegations, contained in a civil suit filed by Atty. Gen. Jerry Brown, mark the first legal actions taken against Bell's leaders since The Times reported in July that they were among the highest paid municipal employees in the nation, with Rizzo leading the way with a salary of nearly $800,000. The L.A. County district attorney's office also is investigating Bell, looking at the salaries as well as allegations of voter fraud and questionable business dealings. Federal prosecutors are investigating whether the city violated the civil rights of its predominantly Latino immigrant population with selective enforcement of traffic laws and code violations.

After reviewing boxes of city documents over two months, state prosecutors said Rizzo and his colleagues "took great pains" to conceal their high pay from the public.

"What is clear is that the City Council and city administrator and other officials abused their public trust. They engaged in a collaboration that [amounted] to a civil conspiracy to defraud the public," Brown said.

Rizzo's attorney said his client had done nothing illegal and accused Brown, who is running for governor, of using the suit for political gain.

"At this particular point in the election cycle, it doesn't surprise me that charges have been filed," attorney Jim Spertus said.

The attorney general's lawsuit does not charge Bell officials with crimes. Brown had agreed earlier to limit his investigation to civil remedies and allow the Los Angeles County district attorney to focus on a criminal case.

In the suit, prosecutors cited several examples of actions that they said provided evidence of conspiracy by current and former City Council members and administrators. One was an e-mail from then-Assistant City Manager Angela Spaccia to incoming police Chief Randy Adams, warning him to change the language of his contract to make it more difficult for outsiders to figure out his full compensation.

"We have crafted our Agreements carefully so we do not draw attention to our pay," Spaccia wrote in the 2009 e-mail. "The word Pay Period is used and not defined in order to protect you from someone taking the time to add up your salary."

Another example was an ordinance passed in February 2005 by Bell's council and labeled a measure "limiting compensation for members of the city council." In fact, the law nearly doubled council members' pay from $673 to $1,332 per month (and that sum did not include other salaries they received from various city boards).

The Times has reported that both Rizzo and the City Council obscured their full salaries by receiving payments from four separate city boards and commissions. In at least two cases, the city provided inaccurate information in response to requests for Rizzo's salary.

The Bell scandal has already prompted state legislation designed to make it easier for residents to learn the salaries of public officials. Brown said Wednesday that he had launched a review of all local government salaries of more than $300,000, citing several examples across the state of high compensation levels he said might be suspect. He also called for the creation of a state commission to look at caps on public salaries.

In addition to dealing with compensation, the lawsuit requests that the court appoint a receiver to oversee the city. Brown acknowledged that asking a judge to remove elected officials from office and demanding that they return their salaries is highly unusual.

"Some areas of the law we're plowing may be novel," he said. "We're testing the proposition of what public officials can pay themselves…. The fact that someone is elected doesn't mean they get a license to steal, doesn't mean they get a license to line their pockets."

Michael Colantuono, a veteran government agency attorney, said Brown is using a statute sometimes employed by taxpayer groups to oppose expenditures of public funds they consider illegal. Section 526a of the California Code of Civil Procedure establishes the right to sue over "any illegal expenditure of, waste of, or injury to, the estate, funds, or other property of a county, town, city or city and county of the state."

Colantuono agreed that it was highly usual for prosecutors to use the tactic.

"I cannot think of a time the attorney general has used it," he said. "The interesting question is: Does the attorney general have standing?"

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