Fund-Misuse Charges Against Farrell Probed

The district attorney’s office is conducting a formal investigation into whether Los Angeles City Councilman Robert Farrell violated conflict-of-interest or campaign disclosure laws by allegedly funneling more than $400,000 in financial support to his former wife’s small social service agency.

Until now, the district attorney’s office had been conducting an informal investigation in the aftermath of news reports about Farrell’s dealings.

“We have formed no opinion that he is in violation of the law,” Steven Sowders, chief of the prosecutor’s Special Investigations Division, said Saturday. “All we are doing is investigating.”

Prosecutors will try to determine whether Farrell helped provide real estate gifts, rental payments, campaign contributions and a government grant to the Improvement Assn. of the 8th District, the nonprofit organization operated by Farrell’s ex-wife, Essiebea Farrell.

Conflict-of-interest regulations prohibit public officials from voting on matters that benefit family members. State law also prohibits elected officials from diverting campaign funds to personal use.

Farrell allegedly used his influence to convince Security Pacific National Bank officials in 1984 to donate a bank building and an adjacent parking lot to the Improvement Assn., rather than give the property to the city.

Six months later, Farrell received city approval to move his district office and staff into the building in South-Central Los Angeles and began paying rent to the Improvement Assn., city documents show. Until then, Farrell paid no rent for his district offices. That transaction resulted in a $282,600 loss to the city in real estate and rent.

City records also show that the councilman’s political committees have contributed $56,000 to the Improvement Assn. during the last four years. Moreover, in December, 1986, Farrell voted with the council majority to approve a $53,105 federal grant to the agency, city records indicate. Farrell is chairman of the council’s Grants Committee.

Farrell, who is facing a possible recall election this year, could not be reached for comment Saturday. However, in earlier statements, his attorney defended the councilman’s actions as “open and above board.”

Agency Projects

Farrell and his ex-wife founded the Improvement Assn. of the 8th District in 1980. The agency runs a small literacy and food distribution program. The Farrells were divorced in September, 1986.

Farrell is also facing allegations that a number of friends and relatives were hired by the councilman, including a female companion and a sister-in-law in need of work. Farrell, 51, is also said to have used his influence in an attempt to obtain government money to fund repairs on his 74-year-old mother’s home and to funnel a $103,384 grant to a nonprofit agency founded by Assemblywoman Maxine Waters (D-Los Angeles). Some City Hall sources believe that Farrell attempted to steer the money to Waters’ agency with the hope of gaining the prominent assemblywoman’s support in a recall election.

Although the city has policies prohibiting favoritism and nepotism, there are no laws specifically preventing such action and the allegations concerning favoritism and nepotism are not part of the district attorney’s investigation.