Stanford Accuses Cory, Can’t Back Up Charges

Conceding he had no evidence, Dan Stanford, a Republican candidate for state controller, claimed Wednesday that incumbent Democrat Ken Cory had illegally pocketed $300,000 in campaign contributions.

At a press conference, Stanford even offered to give up his quest for the post if Cory, who writes the checks to pay the state’s bills, could prove that he has done nothing wrong.

But after half an hour of questioning, Stanford, former chairman of the Fair Political Practices Commission, was unable to provide evidence of wrongdoing on Cory’s part and he nervously conceded that the allegations were actually no more than personal suspicions.

“I don’t have the documents,” Stanford said of income tax returns and other papers that he insisted would show Cory’s guilt. “The answer to these questions are uniquely in the possession of the state controller.”

Stanford, who was appointed commission chairman in 1983 by Gov. George Deukmejian and resigned in December to run for controller, said he had not investigated the Cory matter during his tenure because “I was spending 12 to 14 hours a day” on other cases and because “no one brought the matter to my attention.”

Cory could not be reached for comment. But Deputy Controller Peter Pelkofer said Cory’s campaign reports were never questioned during commission audits.

“I don’t know whether Mr. Cory wants to take (Stanford) up on his offer to resign,” Pelkofer said. “He might want to keep him in this race if he keeps providing good press for us.”

Stanford, an attorney who faces Republican Assemblyman Don Sebastiani of Sonoma in the June primary, has sought to build his campaign around a theme of election reform by citing his commission experience and the legal actions it has filed against local and statewide political figures.

The press conference underscored Stanford’s intention to wage a hardball campaign, focusing on the Democratic incumbent rather than on his Republican opponent.

Stanford’s latest allegations were based on a $522,000 campaign loan that Cory received in 1974 from Orange County millionaire Richard O’Neill and Louis J. Cella, a physician later convicted of embezzlement. Cory has stated in documents filed with the state that he paid the loan back by selling his interest in a ranch jointly owned by himself, O’Neill and Cella.

Since then, Cory used about $300,000 from his campaign fund to reimburse himself for the sale of the ranch share, a generally accepted and legal practice followed by many candidates.

Stanford charged that there is no proof that Cory actually repaid O’Neill and Cella. That might mean, he said, that the $300,000 went into Cory’s pocket in an illegal diversion of campaign funds. He offered copies of the Democrat’s campaign reports going back to 1974 and insisted they contained “startling figures.”

He conceded he had no proof to back up his charge, but added: “I have a suspicion that raises serious questions . . . and I think that given the problem that we’re discussing, namely $300,000 in campaign contributions going into the state controller’s pocket, I think that somebody has an obligation to ask these questions.”

Commission reports released on Wednesday showed that the commission had audited Cory’s campaign reports from 1975 to 1978 and found them to be accurate except for technical errors.

Stanford filed copies of his allegation Wednesday with the commission and the Sacramento district attorney. Commission Executive Director John Keplinger referred the complaint to Atty. Gen. John Van de Kamp “in light of Mr. Stanford’s past relationship with the FPPC and in the interest of fairness.”