Bell city officials face arraignment today [Updated]

Los Angeles District Attorney Steve Cooley announces the arrests of eight current and former Bell city officials on corruption charges.
Los Angeles District Attorney Steve Cooley announces the arrests of eight current and former Bell city officials on corruption charges. Frank Stoltze/KPCC

Bell's mayor, three council members, former city manager and three other former officials were arrested Tuesday on corruption charges related to their exorbitant salaries. All spent the night in jail. An audit shows the city of Bell mismanaged more than $50 million in bond money and suggests that its disgraced ex-city manager and other employees used city funds to line their pockets.

Updated at 3:52 p.m. | Permalink

Judge refuses to lower bail for Bell officials

A judge has refused to drastically reduce high bail amounts of four current and former officials of the Southern California city of Bell who are among eight arrested in a corruption probe.

Los Angeles County Superior Court Judge Michael E. Pastor ruled Wednesday that the alleged crimes are extremely serious and the defendants could be flight risks.

Pastor only reduced ousted city manager Robert Rizzo's $3.2 million bail to $2 million. Pastor also made modest reductions in bail for former assistant city manager Angela Spaccia and current Mayor Oscar Hernandez. Former councilman Victor Bello's bail was left unchanged.

Attorneys argued that the four have ties to Bell dating back decades, are family people and haven't been in trouble before.

The Associated Press

Updated at 12:38 p.m. | Permalink

Bell officials make first court appearance

Five current and former Bell officials must prove to a judge that they won't use looted city funds to make their bail.

The five, including Mayor Oscar Hernandez and ousted city manager Robert Rizzo, made their first court appearance Wednesday after being charged with appropriating $5.5. million from the working-class Los Angeles suburb. They have another hearing set for the afternoon.

Three other ex- or current officials also are charged but they'll be allowed to make bail immediately.

The eight didn't enter any pleas and their arraignments were postponed until next month.

Copyright 2010 The Associated Press.

Updated at 10:32 a.m. | Permalink

Bell audit: Illegal taxes, unlawful payments, mismanagement

The state controller's office released the audit today, concluding that the scandal-ridden L.A. suburb lacked any checks and balances on its finances.

The audit says the lack of oversight resulted in illegal taxes, mismanaged bond funds, inappropriate salaries for its leaders and more than $15 million on questionable contracts and land purchases.

The audit says ex-city manager Robert Rizzo got an enormous salary and used more than $93,000 to repay personal loans. He and seven other current and former officials were arrested Tuesday and charged with misappropriating public funds.

"The General Fund was run like a petty cash drawer," said state controller John Chiang Chiang. He said this resulted in "fraudulent, wasteful spending."

The report said that the city's internal controls were "virtually non-existent," which allowed for the large salaries which have caused widespread outrage, as well as alleged illegal tax increases and mismanagement of public funds.

According to the audit, former Bell City Manager Robert Rizzo, who was arrested yesterday, had complete control over how city funds were spent, approving high salaries for himself and others. Rizzo was making over a million dollars in total compensation. The city spent over $5.8 million on compensation for the top six city administrators, the City Council and the mayor in the past year.

Rizzo and others took personal loans from public funds; Bell approved $1.5 million in loans to Bell employees. The audit said that these would all be considered gifts, because they didn't provide a public benefit.

Performance evaluations that were supposed to be done for top officials couldn't be found, according to the audit.

The audit also showed mismanagement of tens of millions of dollars of bond funds, which were placed in accounts that wouldn't earn interest. The audit said that taxpayers have lost approximately $1.7 million in potential interest.

The money from the bonds was supposed to be put toward the Bell Sports Complex, but the audit said it was unclear whether any progress had been made on the project. No plans were found for completing or developing the Complex, and after six years, there's a dirt lot with no sports complex.

The audit found tens of millions of dollars of other questionable expenses.

The next audit is scheduled to be released by the end of October, looking at Bell's handling of state and federal funds. The final audit is scheduled for early November, looking at financial reports prepared by an outside accounting firm.

- Mike Roe/KPCC wire services

Original story:

Former city manager Robert Rizzo faces $3.2 million bail. The rest face bails ranging from $130,000 to $377,500.

During Tuesday's raids, most went into custody quietly. Los Angeles District Attorney Steve Cooley said Bell’s mayor, Oscar Hernandez, did not. Cooley said police used a battering ram to get through his front door after he failed to answer.

Cooley says Hernandez, Rizzo and the others are accused of misappropriating at least $5.5 million.

"The complaint alleges they used the tax dollars collected from the hardworking citizens of Bell as their own piggy bank which they then looted at will," he said.

Prosecutors allege that Rizzo and his assistant secretly set their own salaries without council approval. Rizzo collected more than a million dollars a year in salary and benefits.

Prosecutors accuse Hernandez, three other members of the city council and two former council members of paying themselves for attending meetings that "never occurred" – meetings of tiny governing boards like the Solid Waste Authority.

Those council members pulled down nearly $100,000 a year for their part-time work.

“This, needless to say, is corruption on steroids," Cooley said.

An attorney for former city manager Rizzo said Bell paid his client well because he lifted it out of near insolvency in the 1990s. Attorney James Spertus also said Rizzo acted above board at all times.

“Mr. Rizzo did not operate secretly. He did operate with council approval," Spertus said.

He also took issue with his client’s public arrest by agents of District Attorney Cooley, who’s campaigning for state attorney general. "It doesn’t surprise me one bit that at this time in the election cycle, a highly visible public circus would be orchestrated to take Mr. Rizzo into custody.”

Cooley denied that politics have anything to do with the arrests.

A statement released by Bell’s interim city manager Pedro Carrillo said Rizzo and his assistant were “at the root of the cancer that afflicted the city” and promised to work for reform.

The extraordinary arrests in Bell follow civil lawsuits filed against some of the same city officials by State Attorney General Jerry Brown, who’s vowed to do the same in other cities. The Bell scandal’s also prompted the state legislature to consider a number of proposals to reign in local government pay and pensions.

Bell’s salaries, first reported by the Los Angeles Times, have sparked angry protests by hundreds of people who’ve packed city council meetings for weeks on end. Many rejoiced at the arrests.

“This is satisfying to me because this is the start of seeing Democracy work, justice work for the residents of Bell," said Mario Rivas, a 36-year-old Iraq War veteran who grew up in Bell.

“The justice in this country, thank god, is very, very good," said Carmen Bella. The 76-year-old Bell resident said she'd like to see those arrested stay in jail. "When you steal something, you go to jail.”

In their complaint, prosecutors declined to charge former Police Chief Randy Adams, who collected nearly half a million dollars a year. They said he did not orchestrate his own salary.

But Jennifer Lentz Snyder says the investigation of Bell is not over.

"We’ve finished the first leg of what likely will be a marathon to try to restore the integrity of government in Bell.”

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