4 Charged With $500,000 Theft From School District

Four Los Angeles Unified School District employees, including the director and deputy director of custodians, were charged Wednesday with stealing at least $500,000 from the district in a supplies theft ring.

Dist. Atty. Ira Reiner, whose office filed the charges, announced that the theft investigation is continuing and that “there are a substantial number of (other) employees within the district who are target suspects.” He said the inquiry goes beyond the custodial department and into other divisions of the sprawling district’s service operations.

Reiner also charged that the school district’s inventory and financial records are so “worthless” that prosecution of the cases has been impeded.

“The records kept by the crooks in this case (of the disposition of school goods and property) are detailed and precise,” he said. “The records kept by (the) Unified School District are worthless.”

“This isn’t to suggest they (school authorities) don’t keep records,” he added under questioning a few moments later. “Indeed they do. But they don’t have adequate financial controls, such as we can use them in a prosecution.

“It came down to where they could not have the custodian of their records testify as to the goods that they owned, as to whether they were stolen.”

Bill Rivera, a spokesman for district school Supt. Harry Handler, branded the district attorney’s comments “typical Reiner rhetoric.”

The district’s chief business and financial officer, Robert Booker, said that when Reiner is “being critical of the district’s record-keeping, he’s being very selective and focusing only on those records that are related to this investigation, which is a very small portion of the district’s overall financial records.”

Booker added, “I must restate that the district’s overall financial record-keeping system is appropriate to account for the income and expenditures of the school district.”

Reiner, however, insisted that those charged, and perhaps many other district employees, have been able to steal or divert hundreds of thousands of dollars in school supplies over at least a three-year period without district officials even being aware that they were taken.

Charged and surrendering to authorities Wednesday were James Leroy Riley, 55, of Lynwood, the district’s director of custodial operations; Melvin Noelani Tokunaga, 42, Agua Dulce, the deputy director of the department; Robert Jose Barrios, 34, Tujunga, a senior district gardener, and Joseph Brazile, 53, Los Angeles, a power-spray operator.

Riley was charged with one count each of conspiracy to commit grand theft, conspiracy to commit embezzlement and embezzlement. Tokunaga was charged with both conspiracy counts, two counts of grand theft and two counts of embezzlement. Barrios was charged with both conspiracy counts and with four counts of grand theft and Brazile with both conspiracy counts and one count of grand theft.

Reiner said the maximum possible sentences, if each defendant is convicted on all charges, are eight years for Tokunaga and six years for Riley, Barrios and Brazile.

Arraignment of the four was postponed to April 9 to give their attorneys a chance to review prosecutorial materials in the cases.

Tokunaga, who had been arrested late last year, was continued on $50,000 bail, Riley posted $5,000 bail and Barrios and Brazile were released on their own recognizance.

Two hours later, the school district announced that effective Wednesday, all four men were formally suspended from their duties without pay and that a recommendation will soon be made to the Board of Education that they be fired.

Reiner said that although Tokunaga is accused of making most of the direct arrangements for the thefts, he believes Riley was ultimately responsible for them because he allegedly had knowledge of them and, as his superior, permitted Tokunaga to operate in the way that he had.

Basically, the alleged thefts were of two kinds, Reiner said. First, orders were placed with cooperating private firms for supplies for the district that were never delivered but were instead resold and the profits distributed to the accused. Or alternatively, he said, the supplies were delivered but then diverted into the hands of the accused and used or sold directly to them.

Typically, the district attorney said, out of $20,000 worth of supplies allegedly ordered by the accused, only about $5,000 worth would actually end up with the school district.

In some cases, he charged, Tokunaga placed a very large number of “low-value purchase orders” with outside firms, $400 or less, as a means of bypassing the usual district safeguards against unauthorized purchases. Such smaller orders are allowed to go through with fewer checks. With one firm, these totaled more than $30,000, the district attorney said.

Quite a few other district employees cooperated with the four, he added, perhaps some of them unwittingly. Many of these were paid through fake overtime or directly in stolen goods given to them.

At one point in a press conference in his office, Reiner displayed a diamond ring, valued at $25,000, which he charged Tokunaga had bought for his wife with the proceeds from some of the thefts.

But, he added, investigators have been unable to confirm an informant’s’ reports filed with the court alleging that Tokunaga devoted $100,000 of the money to buying a house for a girlfriend.

Tokunaga told The Times Wednesday that he had no immediate comment on any of the charges.

Reiner said that the owners of one of the cooperating firms, Koby’s Appliance of Gardena, have been granted immunity from prosecution for the records and information that they provided investigators.

Operators of two other firms, Lawndale Nurseries and Omni, the latter owned by Fullerton businessman Ronald Richardson, who cooperated with authorities in the investigation, have not been granted immunity, Reiner said. But, he added, they may receive some consideration for their cooperation when charges are filed against them later.

“Our purpose in filing charges today . . . principally against Riley, is to send a message to the employees of the district that this is a wide-ranging and serious investigation and the message is to encourage them to come forward with information,” the district attorney said. SCHOOL THEFT

Here is one example of what Dist. Atty. Ira Reiner described as a typical method employed by the suspects to pull off their string of thefts against the school district.

James Riley, director of operations (custodians) for the Los Angeles Unified School District, receives $5,920 worth of electronic products from Koby’s Appliance of Gardena.

Riley approves a Los Angeles Unified School District purchase order for $5,920 prepared by his deputy, Melvin Tokunaga.

Tokunaga submits the purchase order for supplies to Lawndale Nurseries. The supplies are never delivered to the school district.

Lawndale Nurseries pays $5,920 to Omni, a firm operated by Fullerton businessman Ronald Richardson.

Omni pays $5,920 to Koby’s, reimbursing it for the goods it sent to Riley.