DeStefano quit the stadium in January 2011 to work full time in the promotion field. Lynch, who had run the Coliseum and Sports Arena for 17 years, resigned a month later.
"It's the beginning of the end of a long and sordid tale of corruption and betrayal of the public trust," county Supervisor Zev Yaroslavsky, a commission member, said of the arrests.
At the Coliseum in Exposition Park, Acting Interim General Manager John Sandbrook declined to comment. Staff members appeared resigned to the latest round of bad news. "It is what it is," said Lynda Habash, who works in events.
The groundwork for the scandal lay in years of clumsy stewardship, marked by inattentiveness by commission members and a cozy relationship between Lynch and his bosses. Lynch, DeStefano and Lederkramer spent money, with few controls, on luxury cars, golf outings, massages and other perks.
At one point, Lynch transferred to himself ownership of a Coliseum-bought Cadillac. He and the other managers had unlimited use of a government gasoline card, racking up tens of thousands of dollars in charges even though their jobs required little driving.
Federal investigators are examining cash payments of more than $1 million — much of it in suitcases — to a Coliseum union representative, according to those familiar with the probe. The money was intended to cover stagehands' wages.
The Coliseum has been operating in the red since 2008 and is now so broke that it is unable to make upgrades promised in its lease with USC, the stadium's main tenant. As a result, the panel is about to surrender day-to-day control of the taxpayer-owned property to the private school.
Times staff writers Ari Bloomekatz and Robert Faturechi contributed to this report.