Martinez Indicted Over Credit Card Use

The San Diego County Grand Jury on Wednesday indicted City Councilman Uvaldo Martinez on 28 felony counts of misappropriating and falsely accounting for public funds by using a city-issued credit card to buy meals for himself and others--including expensive dinners with no apparent public purpose.

Martinez, who has acknowledged “errors in judgment” in apologizing to his council colleagues for his spending habits but has insisted that none of the mistakes were intentional, will be arraigned Tuesday in San Diego County Superior Court.

Conviction on any of the charges would force Martinez from the 8th District council seat that the tall, husky Republican has held since his appointment to fill a vacancy in December, 1982. Each count carries a maximum penalty of four years in state prison and a $10,000 fine.

Away on Business

Martinez, who is in Washington on city business, did not return a reporter’s phone calls and issued no statement through his City Hall staff. A phone operator at the Mayflower Hotel, where he is staying, said Martinez had asked hotel security guards to keep reporters away from his room after one newsman knocked on his door.

The councilman had no plans to cut his trip short, according to his executive assistant, Paul Grasso.

Martinez’s court-appointed attorney, former federal prosecutor Jerry Coughlan, also could not be reached for comment. Steve Casey, a spokesman for the San Diego County district attorney’s office, said Coughlan called Martinez late Wednesday afternoon to inform him of the indictment.

The charges darken the cloud that has cast a shadow on City Hall for nearly two years.

They come three months after Roger Hedgecock resigned as mayor after his conviction on conspiracy and perjury charges stemming from his 1983 campaign for the city’s top elective office. And it was little more than a month ago that acting Mayor Ed Struiksma withdrew from the race to succeed Hedgecock, citing an ongoing investigation by Dist. Atty. Edwin Miller of allegations that he submitted false expense reports for an out-of-town trip.

$1,880 in Bills

The charges against Martinez cover $1,880 worth of restaurant and bar tabs billed to the councilman’s city-issued Visa card for 21 meals between November, 1984, and July, 1985. The tabs ranged from an $8.50 bill at a neighborhood Italian restaurant to a $402.93 check at a popular downtown San Diego political watering hole.

Martinez is charged with 10 counts of misappropriating public funds, 17 counts of making a false accounting of public funds, and one count of attempting to misuse public funds.

Casey said the grand jury had reviewed several more of Martinez’s credit card transactions. But Deputy Dist. Atty. Allan Preckel only sought charges against Martinez in connection with the 21 meals mentioned in the indictment, Casey said.

Press accounts in September first brought Martinez’s spending to light. City documents showed that Martinez and Rudy Murillo, then his chief aide, had charged about $9,500 in meals to the city in the year ending June 30--more than the combined total for the other seven council members and the mayor’s office.

Immediately, people whom Martinez had listed as dining partners in his city expense reports came forward to say they had not eaten the meals the councilman claimed, had not discussed city business or had picked up the tabs themselves.

Probe Launched

After those news reports, the district attorney’s office began investigating Martinez’s spending. After a 3 1/2-month inquiry, Preckel announced in December that a decision on whether to indict Martinez would be left to the grand jury. The grand jury convened to hear the case in February.

Some of the best known of the would-be dinner guests are listed among the 71 witnesses who appeared before the grand jury in 12 days of hearings: Rep. Bill Lowery (R-San Diego), Lowery aide Dan Greenblat, San Diego County Supervisor Brian Bilbray, University of San Diego baseball coach John Cunningham, Chula Vista Mayor Greg Cox and others.

The owners and managers of some of the area’s most exclusive restaurants, city officials, current and former members of Martinez’s staff, and a handful of developers with whom Martinez claimed to have dined also testifed before the 19-member grand jury.

Murillo Silent

Murillo, who reportedly declined to answer the grand jury’s questions, remains the subject of investigation for his credit-card spending, Casey said. At Martinez’s request, Murillo resigned as the councilman’s top aide in December, a few days after he was arrested on suspicion of drunken driving.

No one else is under investigation in the credit card probe, according to Casey.

Months before the grand jury launched its inquiry, published reports detailed the circumstances of some of the meals that now form the basis for Martinez’s indictment. Some examples:

- Martinez is charged with falsifying a public account in claiming that he dined at the Brigantine Restaurant on Nov. 1, 1984, with Lowery and Greenblat. Both men said in September that they had not shared a meal with Martinez in at least a year.

- The indictment charges Martinez with misappropriating public funds by charging to the city a $98.13 meal at the Butcher Shop on Dec. 1, 1984. Martinez claimed he bought dinner that night for John Cunningham, the USD baseball coach, and Cunningham’s wife, Nancy. An expense report said they discussed “expansion of USD sports complex.”

Martinez later said the coach had explained over dinner his problems in raising money to build a new baseball field. But Nancy Cunningham questioned that recollection. “There would be no reason for John to explain that,” she said. “The field is beautiful the way it is.”

The Cunninghams said they had no idea they were being treated to dinner at public expense.

- Kathy Aunan, a disc jockey for rock radio station KFMB-FM, confirmed that she joined Martinez for an $18.13 lunch May 13 at John Tarantino’s Restaurant. But while Martinez listed the subject of the meeting as a “pre-interview on a charity event,” Aunun described the meal as a “social lunch” set up by Martinez so he could get to know her better. Martinez is charged with misappropriation of public funds in connection with the lunch.

- Martinez used his city credit card April 23 to treat 10 staff members and friends to dinner at Dobson’s Bar and Restaurant. But Murillo said he returned to the restaurant the next day, gave owner Paul Dobson a personal check for the tab and asked him to tear up the credit card slip, because he did not consider the meal city business.

Murillo said one of the main topics of discussion that evening was Proposition A, the growth-management initiative of which Martinez was a leading public opponent until his credit-card troubles surfaced. Murillo said the anti-A campaign committee eventually reimbursed him for the meal.

The indictment charges Martinez with attempting to misappropriate public funds by billing that meal to the city.

Reactions Differ

The contestants in the runoff for San Diego’s vacant mayor’s office had sharply differing reactions to the indictment.

Former Councilwoman Maureen O’Connor called on Martinez to resign.

“In the best interest of the city, he should seriously consider resigning,” she said. “When someone is hired, or elected, to do a full-time job for the city, I think it is difficult under the circumstances, especially when one is preparing for one’s survival in the court system, to do your job for the city.”

Her opponent, Councilman Bill Cleator, said he was “surprised” to hear of the indictment.

“I have to tell you that I was very sad for his family and also for Uvaldo,” said Cleator, one of Martinez’s strongest allies on the council. “I’m really sad for the City of San Diego, that all of a sudden we’ve got another massive problem and it’s just an unfortunate situation.

“But I really believe that the charter of the City of San Diego is being tested and everything’s going to come out all right in the end, but in the meantime there are a lot of individuals, their lives, are being damaged.”

He predicted the indictment would throw a “cloud over the political process” and may create some kind of backlash against him and his mayoral candidacy.

“It’s hard for me to believe that anybody in the political process is not going to get some backlash on this, and that includes myself,” Cleator said. “When anything happens to a team member, or a member of a class, it has an effect on all of us, unfortunately. But that’s the life we live.”

O’Connor said she did not believe the indictment was a black eye for the city but agreed that it cast a cloud on Martinez’s fellow council members.

“I don’t think that (it) should be reflective of the people living and working in the community,” she said. “I think it’s a reflection on the gentlemen who decided to partake of the excesses, and I think it does reflect negatively on the City Council as a whole.”

One of Martinez’s closest friends during the last 15 years, developer Mike Madigan, said he was “sorry” to hear of the indictments.

“I think that Uvaldo would have intended no wrong,” said Madigan, a senior vice president of Pardee Construction Co. and a top official at the Greater San Diego Chamber of Commerce.

“I couldn’t attribute malicious motives to the guy because in 15 years of knowing him, I’ve never detected malicious motives,” Madigan said. “If the court finds him . . . doing something wrong, it would have been something different than malice or intent to defraud the people of San Diego.”

Please see related story, Part II, Page 1.