Worked at Cal State L.A. : Two Sought in Alleged Embezzlement Scheme

Two former employees of a nonprofit company that operates the bookstore and food services at California State University, Los Angeles, are being sought by authorities in connection with an embezzlement scheme in which as much as $140,000 in cash and equipment was taken, officials said Wednesday.

Arrest warrants were issued Feb. 20, charging Michael Priegel, 35, former acting director of Auxiliary Services Enterprises Inc., and Kelly J. O’Gill, 33, a former food services consultant, with grand theft and conspiracy to commit grand theft, said Los Angeles Police Sgt. James Heisdorf.

Heisdorf said the funds allegedly were used to furnish and remodel a Palm Springs condominium owned by Priegel, and to pay the lease on a condominium in Pasadena for O’Gill.

Auxiliary Services Enterprises is a separate entity from the university and the funds allegedly involved were not from the university’s general operating budget, campus officials said.

Authorities said the arrest warrants were the result of a five-month investigation by Los Angeles detectives that found that at least $50,000 had been taken. However, a university audit conducted last year discovered that about $140,000 in company funds may have been misappropriated.

Heisdorf said O’Gill was also accused of grand theft auto in the disappearance of a 1985 pickup truck that was used by Cal State Los Angeles’ Food Services Department. The truck was recently discovered, stripped, in an Arizona junkyard, Heisdorf said. About $15,000 in computer software programming and $5,000 in stereo equipment--earmarked for the campus pub--also were missing, he said.

University spokeswoman Ruth Goldway said the problems within Auxiliary Services Enterprises were discovered in August, 1985, when its director, Walter C. Miller, began implementing a new accounting system.

Investigators said a $1,500 check was returned to the company by Bullock’s department stores, indicating that it was a refund for furniture that was never received on campus. Heisdorf charged that the furniture was delivered to the Palm Springs condominium.