D.A. targets corruption in Lynwood; 5 indicted

Five current and former Lynwood City Council members were indicted Thursday for allegedly using hundreds of thousands of dollars in public funds to illegally boost their salaries, pay for personal expenses and even hire an exotic dancer at a “gentleman’s club.”

The charges are the latest lumps for the working-class city south of downtown Los Angeles that for years has been plagued with accusations of graft and corruption. Last year, Lynwood’s former longtime mayor received a 16-year federal prison sentence after being convicted of embezzling from city contracts.

Some of those charged Thursday had vowed to clean up City Hall. But the L.A. County district attorney’s office now alleges that they used their positions to enrich themselves.

The indictments depict a city where politicians freely sought ways to boost their compensation, with some council members allegedly padding their official $9,600 salaries to receive as much as $100,000 for part-time service. Prosecutors said Mayor Louis Byrd and Councilman Fernando Pedroza used city credit cards and other city funds for personal expenses, including trips abroad and airline tickets for spouses, and in Pedroza’s case, a session with an exotic dancer in Mexico, prosecutors said.

Both local and federal authorities have targeted corruption in the swath of small industrial cities that dot southeast Los Angeles County. Trials are pending for current and former Vernon officials charged last year, while prosecutors in recent years have scored courtroom victories against politicians accused of misconduct in Compton, Huntington Park, South Gate and Bell Gardens.

In an interview Thursday, Byrd, 75, denied any wrongdoing but acknowledged that he and other officials had tried to find ways to increase their compensation.

“We had to come up with some process to make a little more. This is a full-time job. They call it a part-time job, but that’s bull----,” he said. “For all the hassles we take, we can never be compensated enough.”

The district attorney’s investigation began more than three years ago, with prosecutors serving search warrants at Lynwood City Hall and several homes after The Times published an article highlighting the lavish perks enjoyed by politicians in one of the county’s poorest cities.

Lynwood, which has a population of about 70,000, has been trying in recent years to eliminate its reputation for public corruption. The City Council canceled the city credit cards, and even lowered the cap on travel expenses, though it still dwarfs those of other cities Lynwood’s size: $25,000 for the mayor and $16,000 for council members.

“Our community loses faith in elected officials because things like this happen,” said Jose Luis Solache, Lynwood’s school board president. “And it’s not like this happens one time. It continually happens.”

The case that led to Thursday’s indictments began in 2003, when Faustino Gonzales, a former Lynwood city manager, met with David Demerjian, head of the district attorney’s Public Integrity Division. Gonzales told Demerjian about a trip he took the year before with Pedroza, Byrd and former Councilman Arturo Reyes to sister city Guadalajara, Mexico.

According to the criminal complaint, Pedroza and Gonzales went to a “gentlemen’s club,” where they drank liquor and ate.

“Pedroza hired a private room, where a dancer associated with the club entertained him,” the complaint read. “At the end of the evening Pedroza and Gonzales received a bill from the club for about $1,500, which was paid by a city credit card and never reimbursed.”

Through his attorney, Pedroza denied that the events took place.

Reyes later told prosecutors that fellow council members were dramatically raising their salaries by attending numerous meetings of two city agencies, the Lynwood Public Finance Authority and Lynwood Information Inc. The meetings drew heavy criticism from residents, because they were held even if there were no issues to discuss.

“We think it was just to pad their pay,” Demerjian said. “Some of these meetings lasted just a couple of minutes. Each of the defendants received $75,000 to $80,000 [a year] just from those meetings.”

Demerjian said that instead of being paid $450 per meeting by the agencies themselves, the officials got money straight from the city, without authorization.

Besides Pedroza and Byrd, prosecutors on Thursday charged former Councilmen Reyes, Ricardo Sanchez and Armando Rea.

Joel R. Isaacson, a criminal lawyer representing Pedroza and Rea, said the men were shocked by the charges, particularly those involving the city committee meetings.

“This is the first we’ve heard that this could be criminal,” Isaacson said, adding that the city attorney and other city authorities approved those meetings and the compensation. “We were aware of an investigation into things such as phone bills and travel, but we thought they were really minor in nature and the amount. We didn’t expect this type of investigation.”

Although the median income in Lynwood is only about $34,000, council members for a long time were among the most well-compensated compared to officials in similar-size California municipalities.

A Times investigation in 2003 found that council members enjoyed New York musicals, steakhouse dinners and a samba show in Rio de Janeiro, all at taxpayer expense. From 1998 to 2003, travel and credit card expenses incurred by the five-member City Council cost taxpayers more than $600,000. Council members took $100 per diems even to attend local parades, golf tournaments and beauty pageants.

Then there was the case of former longtime Lynwood Mayor Paul Richards. He was convicted in 2005 of steering city contracts to a front corporation he secretly owned. The scheme could have netted Richards more than $6 million, although he managed to siphon off only $500,000 before authorities interrupted. His 16-year prison sentence was considered one of the longest for a public corruption case brought by the federal government.

Miguel Figueroa, a longtime Lynwood resident and lampshade maker, had to sue and wait two years to see city credit card records and council earnings information. He said he hoped the charges would change Lynwood’s political culture for good.

“I think they came to believe the D.A. would never come for them,” said Figueroa, 52. “Time kept passing by, and they must have thought nothing would happen. But it finally did happen. I hope in the future other politicians don’t think they can get away with shameful conduct.”

Mayor Byrd argues that the city got a bargain for the amount it paid him. “They could never pay you enough” for all the work council members had to do in Lynwood, he said.

But Demerjian said if that’s how public servants feel, perhaps they should find another line of work.

“I hear these council members say, ‘We put in a lot of time. We should be compensated,’ ” he said. “They’re supposed to be serving the public. If they don’t believe they’re paid enough, then don’t serve the public. Let someone else do it.”

hector.becerra@latimes.com

Times staff writer Richard Marosi contributed to this report.