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Plea Deal for Ex-Chief of Film Agency

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Times Staff Writers

Cody Cluff, the former head of the agency that promotes film production in Los Angeles, pleaded no contest Monday to embezzling public funds that he used to pay for excursions to strip clubs and a fantasy baseball camp, and for donations to his children’s high school.

Cluff agreed to repay $80,000 to the Entertainment Industry Development Corp., which he headed for years. It was an agency that received little oversight from a board of directors consisting of top elected city and county officials.

Cluff also made nearly $170,000 in political contributions to many of the same politicians.

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The scandal involving misuse of agency funds sparked reforms, including bans on political contributions and spending on travel and entertainment, and creation of corporate accounting and expenditure controls. Public officials were removed from the agency’s board of directors and replaced by representatives of the movie industry, neighborhoods, labor and business groups.

Defense attorney Mark Werksman said his client accepted the plea agreement because he did not want to risk the possibility of a lengthy prison term if he was convicted. When he surrenders next month, Cluff will go to prison for 90 days while the Department of Corrections determines whether he qualifies for probation.

“This is a sad day for Cody Cluff because he tried to serve the film industry and the city of L.A. during his years at EIDC,” Werksman said. “And I think he’s collateral damage in the district attorney’s campaign to clean up perceived political corruption throughout the county.”

Cluff will surrender by June 21 and could serve up to two years in prison. The plea bars Cluff, who has resigned from the agency, from holding public office.

Los Angeles County Dist. Atty. Steve Cooley called Cluff’s felony conviction a victory for the county’s taxpayers.

“It wasn’t just the nature of how he spent the money,” Cooley said Monday. “It was the fact that he spent the public’s money for things that were not in the public interest, not authorized by law and not authorized by the governing entity.”

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A spokeswoman for Los Angeles Mayor James K. Hahn said he is glad that Cluff’s criminal case has been concluded so that the agency can focus on its mission to keep film production in Los Angeles. Cluff was originally given the job of city film czar by former Mayor Richard Riordan.

“This [plea] sends an important message,” said Hahn spokeswoman Shannon Murphy. “Mayor Hahn believes that public servants should always be held to the highest ethical standard and should be held accountable for their actions.”

Cluff’s co-defendant, agency General Manager Darryl Seif, still faces charges that he forged a letter from the mayor’s office and used a counterfeit city seal. Seif is scheduled to return to court next month.

After a yearlong investigation, the Los Angeles County Grand Jury indicted Cluff in August for misappropriating public funds. Prosecutors charged that he used the agency’s money for personal expenditures, including visits to Arizona strip clubs, a country club membership and a trip to the Dominican Republic. Cluff also spent large sums of money on a former girlfriend.

The district attorney’s office contended that the corporation was a public agency and was therefore prohibited from spending money on political contributions and private luxuries. Cluff, 45, maintained that it was a private corporation and therefore no public money passed through his hands.

Los Angeles County Superior Court Judge Larry Paul Fidler ruled in January that the agency legally fell somewhere in between.

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The agency was quasi-public because it collected government fees, he said, but it also served as a private company by bringing film work to the region.

Deputy Dist. Atty. Max Huntsman said Monday that Cluff was given free rein to run the agency and that his expenditures were outrageous.

“The City Council and the Board of Supervisors completely abdicated their responsibility,” he said. “They just didn’t do their job.”

Several elected officials told grand jurors that they did not attend meetings or monitor spending by the agency, which was created in 1995 to streamline permitting and promote film production in Los Angeles.

Werksman said his client never profited from the expenditures. “These are basically business expenses he is accused of squandering,” he said.

Officials said the agency has been revamped as a result of the scandal.

“We stepped in and completely realigned the way the EIDC operates,” said Lisa Rawlins, head of the board of directors. “Today serves as a reminder of what came before.... It’s good for the EIDC to get these issues behind us. But the EIDC moved on a long time ago.”

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Los Angeles City Councilman Dennis Zine said Cluff misused taxpayer money.

“Public funds are for public purposes,” Zine said. “It wasn’t his personal slush fund.”

Councilwoman Wendy Greuel said Cluff’s plea closes a chapter in the history of the agency. “It says the old days of the EIDC are over,” she said. The prosecution of Cluff signaled that the agency does not tolerate misconduct, she said.

“It confirms what we felt, that he was mismanaging the EIDC,” she said. “It demonstrates that this kind of behavior is unacceptable.”

City Atty. Rocky Delgadillo said the investigation and a subsequent audit led to a reorganization of the agency’s management and new controls on spending. The agency has a new president and a new senior vice president of finance.

“With that chapter behind us,” Delgadillo said, “the city can move on to the more important business of keeping Los Angeles the entertainment capital of the world.”

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