Moriarty Probe Is Focused on Whether to Indict Roos

The federal prosecutor heading the W. Patrick Moriarty inquiry said Wednesday that the government’s “top priority” in the continuing political corruption investigation is to obtain a speedy decision on whether to indict Assembly Speaker Pro Tem Mike Roos (D-Los Angeles) on fraud charges.

Chief Assistant U.S. Atty. Richard E. Drooyan said the results of an investigation into Moriarty’s financial and political ties to Roos will be presented to top Justice Department officials in Washington next week for a decision on whether to prosecute.

“I am in the process of finishing a supplemental memo to the Justice Department and it will be completed within the week,” Drooyan said in an interview. “I don’t think it will take very long to make a final decision.”

Drooyan, assessing the future of the Moriarty investigation a day after the conviction of former Norwalk Assemblyman Bruce E. Young on mail fraud charges, revealed in the interview that the Justice Department ruled against an indictment of Roos last year, but “suggested further investigation” and requested additional information about the case.

“We had sent back a prosecutive memo to Justice setting forth all of the information we had as of the spring of 1986,” Drooyan said. “During the summer, the department took the position that there were insufficient facts to justify a prosecution at that time. The additional investigation has now been completed, and we have supplied some new information.”

Key Moriarty Supporter

Drooyan said the U.S. attorney’s office in Los Angeles made no specific recommendations last year on whether Roos should be indicted and “will probably not make specific recommendations” in the report to be submitted next week.

“We will, however, assess the strengths and weaknesses of any possible case,” Drooyan said, declining to speculate on what the final decision will be or to elaborate on the nature of possible charges against Roos.

Roos, 41, was a key supporter of a 1981 effort by Moriarty, former owner of the largest fireworks company in the United States, to obtain legislative approval of a bill to legalize so-called safe-and-sane fireworks throughout California. At the same time, he invested $50,000 in a Moriarty real estate project, receiving a return of $100,000 about 14 months later.

While the U.S. attorney’s office and the Orange County district attorney’s office, which are operating together in the Moriarty investigation, have made all other prosecution decisions duri1852252276the Roos case to the Justice Department last year to avoid any appearance of conflict of interest.

Roos, who has retained his Assembly seat while giving up his leadership position since the Moriarty investigation began, is represented by Los Angeles attorney John J. Quinn, a senior partner in a downtown law firm that once employed Drooyan and in which U.S. Atty. Robert C. Bonner was a partner.

Neither Quinn nor Roos had any comment Wednesday on Drooyan’s disclosures. But non-government sources close to the Moriarty case have predicted in the past that Roos may not be indicted, arguing that the government has a much tougher case to prove against him than it did against Young, who was found guilty of five of 28 mail fraud counts Tuesday after a monthlong trial.

Young also had a $50,000 investment with Moriarty in a Baldwin Hills condominium project and received a promise of a “two-for-one” return, but he never received his money. Jurors said his conviction, however, was based primarily on other evidence against him about campaign money-laundering activities and failure to report income from Moriarty and two cable television companies.

Discussing the Moriarty investigation in the aftermath of the Young case, Drooyan declined to say who besides Roos might be a possible target for prosecution, or whether Young’s conviction will help the government in looking at possible indictments of other legislators.

‘Each Case Is Different’

“I don’t think you can make a general statement that the investigation is headed in any particular direction,” Drooyan said. “Each case is different. I can only say at this time that further indictments are possible, but I’m not in the position to say anything else at this time.”

Drooyan said he and Chief Assistant Orange County Dist. Atty. Michael Capizzi will meet with Orange County investigators and agents of the FBI and Internal Revenue Service next week, while they wait for a Justice Department decision on Roos, to decide other possible moves in the investigation.

While Drooyan declined to name other officials facing possible prosecution, other government sources have identified former Orange County Supervisor Bruce Nestande, who resigned from office last month, as one of the chief targets at this stage in the investigation.

Nestande, 48, has been the subject of government scrutiny in part because of his backing of R. E. Wolfe Enterprises of Orange County, a firm organized by Moriarty and a Kansas City contractor in an effort to win a contract to operate landfills in Orange County.

Lobbyist’s Work

In addition to Nestande, the Young trial raised questions about the activities of Sacramento lobbyist Dennis Carpenter, who paid Young $10,000 in consulting fees on behalf of a Canadian cable television firm in a check drawn on an account bearing the name of a non-existent company called JMW Associates. The account was set up by one of Carpenter’s employees.

Carpenter also funneled through the dummy account a $275,000 payment from the cable firm to the public relations firm he owns.

Young himself accused Sen. H. L. Richardson (R-Glendora) of engaging in a political shakedown of Moriarty during the crusade for the 1981 fireworks legislation, contending that Richardson had tied his support of the bill to Moriarty’s use of Richardson’s direct mail company, Computer Caging Inc.

Government sources said Wednesday that investigators may examine the activities of both Carpenter and Richardson but stopped short of saying either man actually is a “target” in the case.

“I’ve been told many times I’m not the target of any investigation, and I don’t expect to be,” Carpenter said Wednesday. Richardson earlier denied any wrongdoing in his business dealings with Moriarty.

Drooyan refused to comment Wednesday on whether any action would be taken against either Richardson or Carpenter. He also minimized the importance of the Young conviction in the continuing Moriarty inquiry.

Outcome Uncertain

“I don’t know if the result in the Young case will have any effect on the continuing investigation or not,” Drooyan said, declining to comment when asked if he thinks Young has any potential value to the government as a possible cooperating witness in exchange for lenient sentencing.

Young, 40, is scheduled to be sentenced March 17 and faces a possible prison term of 25 years, although the actual sentences of 10 other convicted defendants in the Moriarty case have ranged from three months to seven years. Moriarty, who received the seven-year prison term, has been a government witness in four trials and hopes for a reduction of his sentence next month.

Drooyan said that with the completion of the Young case, the government is now “in position to evaluate what we have and where we are going.” But he declined to say how much longer the Moriarty investigation might continue.

“That’s very difficult to say,” he said. “If we get information regarding other individuals, we will follow it up. I don’t think it will go on indefinitely.”

Already a Success

Noting that the Moriarty probe already has resulted in the convictions of Moriarty, Young and five former city councilmen from Commerce, Carson and Long Beach, Drooyan said he sees the investigation as a success regardless of what happens in the future.

“I think it’s been very successful already,” he said.

As Drooyan spoke of the government’s next moves, Assembly Speaker Willie Brown (D-San Francisco) said in Sacramento on Wednesday that Young’s conviction demonstrates the need for laws limiting campaign financing and outside income by legislators.

Brown said he hopes legislators will also consider his proposal to more than double current legislative salaries of $37,105--perhaps to the $81,505 level of Superior Court judges in California--to eliminate the need for any lawmakers to rely on outside income to supplement their salaries.

Brown added that he hopes the 120 members of the California Senate and Assembly will not be judged by Young’s actions.

“We as legislators are all too aware of the public perception, in light of this case, that politics is a ‘dirty’ business,” Brown said. “We must--and we will--work to change that perception.”

Also commenting on the need for legislative reforms was Lt. Gov. Leo T. McCarthy, who told The Times that salaries should be raised and outside income restricted “where there is any appreciable chance of conflict of interest.”

Contributing to this story were Times staff writers Jerry Gillam in Sacramento and Tracy Wood in Los Angeles.