Bell raised taxes, used money for higher salaries for officials, audit finds

The city of Bell nearly doubled taxes for sewer, trash, recycling and lighting districts in 2007 without voter approval, then used more than $1 million of those funds to pay for raises to former City Administrator Robert Rizzo and former Assistant City Administrator Angela Spaccia, according an audit released Wednesday morning by state Controller John Chiang.

The finding is one of numerous problems highlighted by Chiang in a sweeping report that sharply criticizes Rizzo and other city leaders for creating an environment with an "extremely high" potential for waste, fraud, abuse and misappropriation of funds. In addition, all requests by Rizzo were approved by the City Council with "little or no question or deliberation," according to the audit.

Chiang also found that the city approved an exorbitant salary for Rizzo without any performance reviews, used more than $93,000 to repay Rizzo's personal loans and issued $50 million in general obligation bonds with no documented plan or "apparent need for the funds."

"We found the city of Bell's administrative and internal accounting control system to be, in effect, non-existent as all financial activities and transactions evolved around one individual -– the former Chief Administrative Officer -– who apparently had complete control and discretion over how city funds were used," the audit stated.

The audit also notes more than $10.4 million in payments made to a private contractor, Dennis Tarango, who served as the city's planning director. Tarango was also Rizzo's business partner in a horse-racing venture.

"This is even more proof that the guy [Rizzo] was manipulating the city," said Bell's interim administrator, Pedro Carrillo. "And we look forward to continuing to work with the controller to make sure that there aren't other irregularities. We have a lot of work ahead of us correcting the mistakes that have been made in the past."

Chiang's office audited the city at Carrillo's request. Since it began looking at Bell's Books, Chiang's office has discovered more than $5.6 million in illegal taxes that should be refunded to residents and businesses.

-- Jeff Gottlieb and Ruben Vives

Photo: State Controller John Chiang. Credit: Mariah Tauger / Los Angeles Times

Photos: Arrests in Bell

Comments

[PGelsman]

Kudo's to the LA Times for bringing this story to light.

[Carrillo Needs to Refund Money]

Pedro Carrillo, Bell's interim CAO, needs to give back all the campaign moeny he received from Rizzo, Cole, Pete Werrlein, Darryl Roth, Bell Tow and Maywood Two, among others.

If Carrillo really wants to correct the mistakes of the past, he'll return the campaign contributions.

And Casso's firm will return the money they were paid by the City of Bell for, um, what was it, bond work?

[Borysd]

They used to call that embezzlement.

[Ron]

Wow, this story keeps getting sleazier and sleazier as all the filth is uncovered and these scumbag officials get exposed even more. Atrocious and revolting to say the least.

[joe]

Why is this not being reported or covered in Spanish news or TV??
Every night I turn to spanish news TV and maybe just a few seconds coverage is all I see...hhhmmmm?

[August]

1000's of more cities to go!

[Larry of LA]

Whenever I thought about journalism as a profession growing up this is why; bringing to light fraud and helping people with that information. Thank you LA times for breaking this story the last couple of months.

The people responsible need to pay back as much as they can, have all their assests liguidated, and go to jail. I hope their passports have already been taken. And again thank you LA Times. This is why media a good strong as indpendent media as possible is absoultely essential for our society.

[Larry of LA]

Ahh I see from the article links to the right they are already jailed: excellent. Because you know they would flee the country if they had the opportunity to.

[August]

For Heaven's Sake, you Californians even elected an ILLEGAL ALIEN....Arnold!

[Kittybarfola]

How about the city taking all the property of the seven who fraud the city to get some of the money back. Rizzo for instance, has a nice ranch in Washington...I am sure they can get a nice chunk of some money back.

[Frank Morales]

An aha moment, I wonder what would happen if an investigation was to take place
LA City mayor and the rest of the city officials were audited.

[carlos]

Everyone forgets to mention that all of these are Democrats..Yeah all a bunch of thieves!

[dnMar]

The big question is will these thieves still be allowed to keep their fat pensions?

[Marley]

Arnold is NOT illegal. Fact checking rather then sensationalizing is a good thing. He came from Austria with very little money, worked hard, educated himself and became very wealthy. Unfortunately he strayed into politics but that's another matter. At least he wasn't stealing $$ from poor, uneducated people like Ratzo Rizzo and his band of thieves.

[Sheldon L. McCormick]

The arrest and prosecution of the Bell politicians for their crimes of, allegededly and essentially, of embezzling Bell citizens and tax payers for higher taxes and cost of city services shows that a combination of good journalism, the district attorney's fair, patient probes and greed do bring political corruption to light. Some have started comparing this case with that of the Omar Bradley administration in Compton several years back. like Compton, corruption, Bell should not have to be synonymous with political courruption. Their are good, moral and honest politicans can and do make their city better and more progression for the interests and needs of its citizenry. This case, which will have to be decided by a court of law, should be a first step to do one--or one thousand--better. They took an oath to do that.

[pat]

August, honey, our guv is many many things, fill in your own blanks here, but illegal alien is not one of them.

BTW August, it's nearly October now....in case you had like appointments and stuff.

[JC]

Hopefully they can convict them under RICO and get all the pension money back.

[David Kowal]

This is why we should not ignore local elections! Only 400 people in Bell voted in 2005 on a measure that made all of this easy to do on the part of the Bell leaders.

Always vote and understand what you are voting for!

[Rumbustious]

So why haven't the police chief and his assistant been arrested? Weren't they too the beneficiaries of this scam? Maybe they were paid to look the other way?

[josh]

But they have found a way to let the corrupt police chief off the hook even though he was getting his share of the loot.

Notice that?

He took the money... but isn't being held accountable through an arrest. Cops protecting their own. Criminal cops looking out for criminal cops.

[ron ronadh]

it shows the value of an alert and competent citizenry and press. bell does not have the former.

[Aaron]

Seems to me that the state controller had little trouble discovering fraud and other problems. Why is there no state-mandated routine audit of cities? It doesn't have to be performed by the state office. Public companies are required to be audited by the SEC, shouldn't public cities have the same requirement?

[Tommy]

PGelsman, it was the residents who brought this to light, NOT the Times.

[Dave]

I think that the death penalty is appropriate in this case.

[Alison]

Many thanks to the LAT for bringing this story to life and continuing to report on the community of Los Angeles.