D.A. Finds No Evidence of Conflict of Interest by Norwalk Councilman

The district attorney’s office this week determined that there is no evidence to warrant any further investigation into whether Councilman Luigi Vernola violated state conflict-of-interest laws.

The district attorney’s office last December opened an inquiry into whether Vernola had a conflict of interest when he gave money to his brother, Mike, to acquire interest in property within a city redevelopment zone.

“It is our conclusion that the . . . (gift) of money to his brother for the purchase of the Dial property does not expose the councilman to criminal liability under California conflict- of-interest law,” Deputy Dist. Atty. James Hickey concluded earlier this week.

The property, on the 11000 block of Firestone Boulevard, was the former site of Dial Chevrolet, which moved to Santa Fe Springs in August.

‘Part of Family Heritage’

Vernola said Wednesday that the decision validated what he had said from the start, that he only wanted to help his younger brother with the 1985 gift and did not stand to benefit personally. “It’s part of our family heritage,” Vernola said. “Family members help out each other.”

State law prohibits public officials from using their offices for personal financial benefit.

Council members sit as directors of the Norwalk Redevelopment Agency and cast votes that could affect the value of property in redevelopment zones. The Redevelopment Agency could, for example, use tax dollars to subsidize new business development or to rehabilitate existing businesses in the zones. In addition, redevelopment money is often used to fund public improvements, such as new sidewalks, that increase property values throughout the area.

Soon after the district attorney’s inquiry was announced, Vernola resigned from the Redevelopment Agency. Vernola, who owns property within and outside redevelopment zones in Norwalk, said he could not properly serve the agency if he were required to abstain on numerous votes that might possibly affect his property. The city is accepting applications from residents who want to fill that position.

Investigator Carlos Perez of the district attorney’s office said Vernola’s resignation had nothing to do with the decision against a full investigation. Perez said he reviewed Vernola’s voting record in relation to his holdings and those of his brother and found no evidence of a conflict of interest.

“He did not vote in a way that would have affected the Dial property or any other property” owned by Vernola or his brother, Perez said.

Despite the outcome of the inquiry, Vernola said he has not changed his mind about serving as a Redevelopment Agency director.

Vernola was a Norwalk planning commissioner when he gave his brother an undisclosed amount of money to invest in the Dial property.

Norman Stutzke, a friend of the Vernolas and president of Keystone Ford on Imperial Highway, bought the parcel in 1986. Mike Vernola became Stutzke’s partner a short time later. Stutzke acquired the remaining parcel of the three-acre site last October. Keystone plans to sell used cars and new trucks on the site, a spokesman said.

Vernola said he had been considering acquiring the site to expand his family-run business. The councilman owns two automotive garages, a service station and a towing service. Mike Vernola helps him manage the towing service.

But the councilman said he decided against the acquisition, in part, because he received legal advice that such a move could constitute a conflict of interest for a planning commissioner. He then gave his brother the money to help him take advantage of the investment opportunity, the councilman said.

The Redevelopment Agency was not involved in the purchase of the former Dial Chevrolet site, officials said.

vernola caption