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L.A. County D.A. looks into money laundering allegation in council race

A man who worked for Rudy Martinez supporter Nick Pacheco says a Pacheco associate pressured him and his wife to donate to the candidate and that they were partly reimbursed. Martinez says he returned the money after an ethics inquiry.

February 02, 2011|By David Zahniser, Los Angeles Times

Los Angeles County Dist. Atty. Steve Cooley has opened an inquiry into allegations that contributors to the campaign of City Council candidate Rudy Martinez were illegally reimbursed for their donations, an official said Tuesday.

David Demerjian, head deputy for Cooley's Public Integrity Division, said his office opened the inquiry into possible campaign money laundering Thursday.

The news comes one day after Martinez told The Times that FBI agents were investigating some private financial dealings of his opponent, incumbent Councilman Jose Huizar.

The complaint submitted to Cooley came from Carlos Lira, who until December worked in the law firm of Nick Pacheco, a former councilman who supports Martinez. In an interview, Lira said he and his wife were pressured by a business associate of Pacheco to make $500 contributions to Martinez, then were reimbursed for half the amount weeks later.

Martinez said he was unaware of any reimbursements. He said he returned $6,000 — $500 apiece to Pacheco and 11 of Pacheco's employees — in December, after the city Ethics Commission sent him a letter asking about the donations.

"Many weeks ago, despite not being asked to do so, we took the proactive step to return all checks in question," said Eric Hacopian, a consultant with Martinez's campaign. "The campaign is not the subject of this inquiry."

Huizar campaign consultant Parke Skelton said he welcomed a look at "what is potentially a serious violation of the city's ethics law."

Demerjian said his office still has a separate inquiry into Huizar that centers on consulting work he performed for a union organization while on the Los Angeles Board of Education. That inquiry was initiated in 2007. "We're coming up on the statue of limitations, so we'll have to make a decision pretty soon," Demerjian said.

An inquiry is not upgraded to the level of an investigation until prosecutors have determined that a crime has been committed, Demerjian said.

In the newest case, Lira, 39, said he and his wife, 27-year-old Rocio Lira, made the donations to Martinez at the instructions of Juan Carlos Jaramillo, a business associate of Pacheco. The couple said they feared they would lose their jobs or face a cut in pay if they told Jaramillo no.

"He said, 'Dude, do you have a checking account? We need to give more money to Rudy,' " Lira said.

Lira also said he and his wife were fired by Pacheco in December after they told him that the firm was failing to adequately represent clients, many of whom were fighting to keep their homes from being foreclosed on.

Jaramillo said the allegations were false but provided no details.

Pacheco, who lost to Huizar in 2005, said Jaramillo is a vendor of his law firm who provides marketing and computer programming. Pacheco said he had nothing to do with any reimbursements of campaign donors.

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