Ethics Panel Makes Corruption Probes a Priority

L.A. commission adopts rules to probe possible money laundering and contracting abuses at the DWP and the airport and harbor agencies.

By Patrick McGreevy, Times Staff Writer

The Los Angeles Ethics Commission directed its investigators Monday to make it a top priority to determine whether the city's airports, harbor, and water and power departments are engaging in corrupt practices.

The decision increases the focus on contracting at the three agencies.

Two grand juries are looking into whether political donations influenced the awarding of contracts. And the city attorney, city controller and county district attorney are investigating whether Fleishman-Hillard overbilled the departments for public relations work.

The ethics panel on Monday adopted a list of "investigation and enforcement priorities" that included looking for political money laundering, abuse of independent expenditure campaigns, "pay-to-play" ethics lapses and "corruption/bribery cases focusing on major proprietary city departments."

Commission President Gil Garcetti, the former Los Angeles County district attorney, said the panel has scarce investigative resources and should therefore focus them on major and willful improprieties in the departments that handle the most money and biggest contracts.

Although the panel is not providing any additional funding or investigators, Garcetti said, the new priority list might warrant reassigning staff to look proactively at the three departments.

"Let's start looking at some of the contracts. Let's go and talk to some of the people who made bids and didn't get the bids," Garcetti said.

"If the proprietary departments know we are going to be more aggressive, we're not just going to sit and wait for someone to bring something to us. That's therapeutic itself."

Commissioners have been frustrated that many of the ethics cases turned up by the panel's investigators in the last decade have involved minor and inadvertent bookkeeping errors by campaign finance committees.

"I want to make a distinction between a technical error and ethical misbehavior," said Commissioner Uri Herscher, in supporting the priority list.

Federal and county grand juries have subpoenaed contracting records from the three city departments, and investigators are looking at potential overbilling on the public relations contracts Fleishman-Hillard had with the departments.

Ethics Commission investigators have already made some inquiries to see whether campaign contributions have affected contracting decisions, sources said, but the commission's action Monday was aimed at pushing investigators to redouble their efforts.

"If there is something going on at City Hall involving proprietary departments, involving a big public relations firm that seems to have major contracts, we should be in the middle of that," said Commissioner Bill Boyarsky. "That's our job."

Executive Director LeeAnn Pelham said she could not discuss what her investigators were doing, but she said it was helpful to know what the commission believes is a priority.

The panel also approved a plan Monday to speed up the completion of audits of campaign committee finances.

In addition, commissioners asked for regular briefings from Pelham on the examination of the three proprietary departments.

The commission also decided to make investigating abuses in independent expenditure campaigns a priority because such campaigns, in which special interests pay for fliers or ads to benefit a candidate without the candidate's involvement, are increasing in number and in the amount of money spent.

"That's the 800-pound gorilla," Garcetti said. "If we have cases involving that, it needs to be the priority."

Also Monday, City Controller Laura Chick urged the panel to look at banning city commissioners from raising money for independent expenditure campaigns. City commissioners were recently prohibited from raising money directly for city candidates.

"There is a giant loophole that has been left," Chick said.

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