Former San Bernardino County assessor led an office laden with misdeeds, report says
County supervisors decide to sue Bill Postmus and five of his employees after an investigation alleges they engaged in criminal and fraudulent activities, such as drug use and falsifying time cards.
By David Kelly- Los Angeles Times
May 13, 2009
Reporting from San Bernardino -- A scathing report released Tuesday details years of alleged crime, fraud and sordid activities inside the San Bernardino County assessor's office, prompting the county to file suit against six former employees in an effort to recoup hundreds of thousands of dollars.
According to the 30-page document, unqualified people were hired to do nothing, time cards were falsified, unauthorized political campaigning was common and former Assessor Bill Postmus was so strung out on drugs that his assistant said he "looked like he fell off a park bench."
At one point colleagues suspected Postmus, later arrested on suspicion of possessing methamphetamine, was huffing canisters of DVD cleaner.
"People were asking, 'What's wrong with Bill? Is he stoned again?' " according to witness interviews in the report.
The investigation, done at the request of the San Bernardino County Board of Supervisors, was compiled by former federal prosecutor John Hueston, best known for successfully pursuing Enron's Ken Lay and Jeffrey Skilling. Hueston is now in private practice.
After reviewing the report, the board voted Tuesday to sue Postmus along with five other former employees of the assessor's office -- James Erwin, Adam Aleman, Rex Gutierrez, Michael Richman and Gregory Eyler.
"As a taxpayer and as a public official, I find the activities detailed in the report deeply disturbing," said board Chairman Gary Ovitt. "There is certainly enough information in this report to compel the Board of Supervisors to pursue legal action against these individuals and seek damages for the taxpayers."
Three of those named in the suit have been arrested and are out on bail. Postmus resigned in February, shortly after being arrested on drug charges the month before. His former deputy, Aleman, has been charged with six felonies, and former assistant assessor Erwin is facing 10 felony counts, most for allegedly failing to properly report gifts received while in office.
Of those mentioned in the report, only Erwin could be reached for comment Tuesday.
"I testified before a grand jury, went to the district attorney and laid out all of this a long time ago," Erwin said. "I tried to do something about it, and now I feel like I am being retaliated against for being a whistle-blower."
Hueston said Postmus was elected assessor in 2006 bent on creating his own personal political machine complete with "superfluous" staff and supported by taxpayers.
He detailed how Postmus quickly expanded the executive staff from a handful of employees to about a dozen, many of whom did little actual assessor work. Some toiled on Postmus' political campaign while others advocated for local politicians or for former presidential candidate Mitt Romney.
Hueston chronicled the work habits of many of Postmus' employees. One of those, Rancho Cucamonga Councilman Gutierrez, was hired as an "intergovernmental relations officer" in 2007. The report said he was taken on largely at the request of an influential businessman.
He was nicknamed the 'Intergalactic Officer' around the office because of "how obscure and irrelevant" his activities were, the report said.
In another case, Postmus hired Richman as a consultant and paid him $49,200. Investigators said 90% of his work was political and unrelated to the assessor's office.
Meanwhile, Aleman allegedly falsified the minutes of meetings to make it appear as if the top employees contributed more than they did. He also faked their time cards, saying they worked 40 hours a week when sometimes they didn't even work 20, the investigation revealed.
"None were described by even one witness as performing important assessor-related work," the report said.
Some hires seemed random. Postmus met the manager of a Riverside restaurant while out to eat and offered him the job of taxpayer advocate, a position in which he apparently did little and did it badly. The report said the two had a romantic relationship.
Postmus paid his friend Scott Becker $1,434 for work that included replacing the official framed portraits of himself, even though the county could have done it for free. When Hueston tried to interview Becker, the former federal prosecutor said the man left a threatening voice mail and "warned that if anyone showed up at his property he would shoot their heads off with a 12-gauge shotgun." The matter was referred to the authorities.
Postmus' drug use was examined in detail. Erwin and Aleman persuaded him to seek treatment, but it didn't take. He didn't show up for meetings and once came to work with blue and white foam around his mouth. Erwin searched his apartment and found canisters of DVD cleaner.
"Mr. Erwin associated the canisters with [Postmus'] bad breath and thought [he] was huffing the chemicals in the canisters," the report said. "Mr. Erwin compared this to snorting glue." Postmus admitted to having a drug problem and said he was being treated.
The report said Postmus and many of his top staff defrauded the county of hundreds of thousands of dollars.
The San Bernardino County district attorney's office is continuing its own probe of the assessor's office.
Supervisor Neil Derry, who employed Erwin as his chief of staff until his arrest, said he doesn't know whether the county will ever collect on its lawsuit.
"My goal is to get at the truth, clean it up and fix it," he said. "This is not the end of it. I have no doubt there will be more information to come out of this process."
Hueston report results in civil litigation against former Assessor Bill Postmus and five others
By Stacia Glenn and Joe Nelson- San Bernardino Sun
Posted: 05/12/2009 03:02:31 PM PDT
A lawsuit was filed today against former Assessor Bill Postmus and five of his employees for allegedly treating the public office as a "personal political machine."
Document: San Bernardino County press release and John Hueston's investigative 33-page report (.pdf file)
John Hueston's investigative 33-page report was released this afternoon after the San Bernardino County Board of Supervisors spent about two hours in a closed session meeting. It is based solely on witness statements.
Hueston, who has been paid $180,000 so far for an investigation into the Assessor's Office launched Jan. 29, said civil lawsuits have been filed against Postmus, former assistant assessors Adam Aleman and Jim Erwin; former assessor employees Greg Eyler and Rex Gutierrez; and former assessor contractor Mike Richman.
"In the words of one former assessor office executive employee, 'The work of the Assessor's Office was incidental to the political work pursued by the executive employees under the tenure of Bill Postmus,'" Hueston said following the closed-door session, when the board decided to take the legal action.
"Our investigation uncovered a scene of which Bill Postmus brought in an executive staff at taxpayer expense to operate as his personal political machine," Hueston said. "This action filed today is not only about the recovery of hundreds of thousands of dollars in taxpayer money wrongly diverted into a personal political machine, but also about the commitment of the county to safeguard the integrity of public office and to take all actions to ensure such an abuse of public funds never happens again."
The county will seek damages against the five defendants "in connection with findings that they were paid for time they did not work and used county resources to conduct political work," according to a county news release. The report concludes that Postmus sought the position of assessor with the intention of operating a political operation from within the office and did so at taxpayer expense.
"As a taxpayer and as a public official, I find the activities detailed in the report deeply disturbing," said Board Chairman Gary Ovitt. "There is certainly enough information in this report to compel the Board of Supervisors to pursue legal action against these individuals and seek damages for the taxpayers."
Postmus, a former county supervisor, was elected to the Assessor's Office in 2006 and resigned in February amid accusations about methamphetamine abuse, time-card fraud and other political shenanigans.
The 22-page lawsuit, filed in San Bernardino Superior Court, details the "superfluous positions" that Postmus is accused of hiring to do his political bidding. He created unnecessary positions such as communications officer, intergovernmental relations officer and assessor's project administrator, according to the lawsuit.
"Postmus filled the positions with objectively unqualified political cronies" and appointed Aleman to run the executive staff, the suit states.
Here is a breakdown of the executive staff's alleged duties as read in the lawsuit:
-- Aleman oversaw political activity and "had virtually no business-related responsibilities or duties."
-- Eyler handled e-mail inquiries from taxpayers, which was a part-time task. He spent the rest of his time on political activities.
-- Gutierrez "performed virtually no work necessary to the mission of the Assessor's Office during his tenure." He is accused of spending his time on city business for Rancho Cucamonga, where he is a councilman.
-- Ted Lehrer, who is not listed as a defendant, was the communications officer responsible for press releases. He issued less than 25. -- An unnamed employee who was Aleman's "special assistant" semt daily e-mails to the Recounty.com Web site - for which Aleman was the editor - and helped develop templates for political e-mails.
Time card fraud is prominently featured in both the report and the lawsuit. Employees are accused of coming in late, taking long lunches, marking hours they were in class as time they worked and leaving early. Yet, the lawsuit claims that Postmus ordered their time-cards be approved.
From January 2007 to July 2008, when Aleman resigned, the county paid him $283,950, making him one of the highest-paid county employees. Eyler received $203,212 during a two-year span from January 2007 to January 2009. Gutierrez, the intergovernmental relations officer, was paid $200,409 even though he is accused of being "inexplicably absent." Erwin, who allegedly spent at least one hour of his workday conducting political benefits, raked in $284,893 from January 2007 to May 2008.
Hueston's report also found that Postmus hired Richman, a personal friend, to do consulting work even though he never actually did any work. Richman and his political consulting firm, MPR, was hired by the county in July 2007 after his contract with the county's Republican Party was terminated.
The Assessor's Office contracted directly with Richman rather than put the contract out for a competitive bid, according to the lawsuit. Richman, who submitted $4,116 invoices monthly, was paid nearly $50,000 for his consulting services. The contract avoided scrutiny by county supervisors because only expenses over $50,000 must be approved. Richman's contract was set at $49,992, according to the lawsuit.
