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Senator: Accused campaign treasurer assured staff that funds were fine

September 15, 2011 |  9:47 pm

Photo: State Sen. Ted Lieu. Credit: Rich Pedroncelli / AP State Sen. Ted Lieu said Thursday he was shocked to learn that a treasurer he entrusted on his campaign for attorney general is now accused of fraud.

The treasurer, Kinde Durkee, is accused of stealing perhaps millions of dollars from her clients, who include dozens of prominent California Democrats. Authorities have not laid out the full scale of the alleged crime, but clients including Rep. Loretta Sanchez and Sen. Dianne Feinstein have said that that Durkee nearly wiped out their campaign funds.

Lieu said his office was informed by the state Franchise Tax Board that an audit had discovered discrepancies in deposits to the campaign account for his unsuccessful 2010 campaign for attorney general. In response, his campaign manager quickly called Durkee.

Durkee assured them that everything was fine and that the issues were merely an oversight, Lieu said, and he took her word for it.

He forgot about the incident for months, until Durkee was arrested by federal agents Sept. 2.

Before that, Lieu, like many of Durkee’s clients, assumed his funds were in capable hands.

He didn’t know Durkee when he hired her in 2002 for his Torrance City Council campaign, but more experienced politicians recommended her. Over the years, the money was there when he needed it, and with nearly $2 million in contributions flowing into his race for attorney general, he didn’t have time to count every penny, he said.

“One of the reasons I hired a campaign treasurer is so they handle all the reporting … and all the money matters. So I have a professional doing it,” Lieu said. “In hindsight, it appears she was a crooked professional.”

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--Abby Sewell

Photo: State Sen. Ted Lieu. Credit: Rich Pedroncelli / AP

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