Review of Bradley’s Stock Dealings Referred to SEC

A review of Mayor Tom Bradley’s stock transactions has been referred to the Securities and Exchange Commission for investigation, City Atty. James K. Hahn revealed today.

The transactions include several profitable investments handled by Drexel Burnham Lambert and Michael Milken, who headed the firm’s high-yield junk bond operations and has since been indicted on charges of racketeering, insider trading and securities fraud.

Hahn made the disclosure after a hearing of the City Council’s Government Operations Committee on allegations that Bradley violated conflict-of-interest restrictions by acting as an adviser to Far East National Bank and joining the board of Valley Federal Savings & Loan Assn.

City Treasurer Leonard Rittenberg told the committee that a $2-million investment in certificates of deposit at Far East, which paid Bradley $18,000 in consulting fees in 1988, was made without influence by or pressure from the mayor.

Rittenberg also took responsibility for a “screw-up” that resulted in a loss to the city of about $12,000 in interest on $600,000 in federal transit funds left in a non-interest-bearing account for three months at Far East in 1987.

“Apparently, this office was notified in mid-August (of 1987) that that money was deposited in Far East,” he said. “This office then was extremely negligent--and I guess I’ll have to take responsibility for that--in that we did not move that money out of Far East National Bank until Nov. 9.”

Bradley’s office released a letter from the Community Redevelopment Agency to Anton Calleia, the mayor’s chief administrative assistant and the man who controlled the account, informing him that the Urban Mass Transit Administration grant had been received. The letter is dated June 19, 1987. In another letter dated June 22, Calleia instructed City Controller Rick Tuttle to deposit the money in a city account, then transfer it to the CRA.

Bill Chandler, press spokesman for the mayor, said the letters establish that Calleia thought that the money would be sent where it belonged.