Bradley Agrees to Pay $20,000 to Settle Suit : Penalties: Mayor must dip into his own funds to end the case over alleged conflict-of-interest violations.

Mayor Tom Bradley on Thursday agreed to pay a $20,000 fine to settle a lawsuit filed by City Atty. James K. Hahn, who alleged that Bradley had failed to disclose personal investments and stock holdings worth $160,000.

Under the terms of the settlement announced in Superior Court, Bradley must pay the fine out of his personal funds, rather than campaign or legal defense funds. Both Hahn and Bradley’s attorneys called the settlement unusual, saying that in virtually all previous cases, politicians have been allowed to use campaign funds to pay fines.

The settlement agreement permits Bradley to pay the fine over two years. He paid the first $10,000 Thursday and must pay another $5,000 by the end of 1990 and the final $5,000 by the end of 1991.

In a written statement, Bradley called the settlement “a fair one” but admitted no deliberate wrongdoing.

“Though none of my mistakes was intentional, I have repeatedly taken public responsibility for the inadvertent errors that were made,” Bradley said in the statement. “I chose the highly unusual step of resolving this matter by paying the settlement from my own resources.”

At issue in the civil lawsuit were six alleged violations of state conflict-of-interest laws, which require that public officials file documents each year disclosing certain financial holdings.

In the lawsuit, filed Sept. 13 after a wide-ranging investigation of Bradley’s finances, Hahn charged that Bradley failed to disclose the following investments:

- Metromedia Inc. bonds totaling $21,271 that should have been reported in 1986.

- An L.A. Gear common stock purchase of $2,200 that should have been reported in 1986.

- A Cadence Design Systems Inc. common stock purchase of $109,125 that should have been reported in 1988.

- A CVN Companies Inc. common stock purchase of $109,812 that should have been reported in 1988.

- A $6,395 Gibraltar Financial Corp. bond that should have been reported in 1986.

- An investment of $21,770 in a Trans World Airlines bond held by Elree Co. that should have been reported in 1988.

Hahn said Thursday that he hoped the settlement would serve as warning to others who are required to comply with the state’s Political Reform Act.

“Twenty thousand dollars out of his own pocket is a pretty severe message to all public officials,” Hahn said.

The settlement amount is higher than average, Hahn said, but added that it was “fair in light of the fact that the violations--and the negligence they demonstrated--occurred over an extended period of time.”

Hahn filed the civil lawsuit last September after determining that there was insufficient evidence to bring criminal charges against the mayor in connection with the reporting problems, as well as a range of other ethical issues that had been raised about the mayor and his associates.

However, in a 1,165-page report on his investigation, Hahn declared that Bradley had become “indifferent” to ethical concerns.

Questions about Bradley’s financial disclosures emerged earlier this year after The Times reported that Bradley’s filings appeared to be incomplete and possibly erroneous. The city attorney’s office, as well as the state Fair Political Practices Commission, asked Bradley to file corrected versions, which he did.

The amended reports of Bradley’s extensive stock holdings and properties led to an initial finding by Hahn’s investigators that he had failed to report major investments totaling more than $220,000.

However, that figure was revised to $160,000 after the lawsuit was filed and investigators got a more detailed look at Bradley’s portfolio, Hahn said Thursday.

The investigators had found, for instance, that Bradley incorrectly reported the amount of interest payments on a loan of more than $10,000 from Far East National Bank, neglected to disclose a loan of more than $10,000 from a stock brokerage, gave the wrong names of partnerships and corporations in which he held an interest and misstated the value of several of his investments.

Hahn’s office pressed charges on only six major omissions, even though more than 100 errors were found after Bradley filed the amended reports, covering 1984 through 1988.

Hahn said Thursday that most of the other errors were either minor or were not clear violations of the law.

Bradley refused to talk to reporters Thursday, but Deputy Mayor Mark Fabiani said Bradley agreed to the settlement and to pay it out of his own pocket “because he wants to put the matter behind him.”

The suggestion that Bradley personally be required to pay the fine was first made by Superior Court Judge Robert I. Weil, who presided over the settlement negotiations, Fabiani said.

“The judge suggested that perhaps the mayor could pay out of his own pocket, and the mayor quickly agreed,” Fabiani said.

Weil said Thursday that he had participated in a number of settlement conferences with Bradley attorneys Daniel Fogel and Lester Ostrov and Assistant City Attys. Charles Goldenberg and Edmund Fimbres. Bradley did not attend the brief court session Thursday.

Weil noted that he had been appointed to the Police Commission by Bradley in 1975 but added that he is “not a personal friend of the mayor” and has had “little dealing with him in the last 15 years.” He said neither side objected to his involvement in the case.

Weil said that while it was not necessary that he approve the settlement, he agreed with its terms and thought it was fair.

“This is not a million-dollar case, this is not a half-million dollar case . . . it is a $160,000 case,” Weil said. “There has been no contention by the city attorney that there was any deliberate conduct and there was anything more than simple negligence involved.”

The settlement was “unique and extraordinary,” Weil said, because it required Bradley to pay the fine personally. In a dozen similar cases, the defendants had been allowed to pay the fines out of campaign funds, he said.

The amount of the settlement also was much higher than in similar cases, according to Weil and Hahn.

Generally, fines total between 1% and 2% of the amount of money that was improperly reported, they said. However, Bradley’s $20,000 fine is 12.5% of the $160,000 at issue.

There was little reaction to the settlement at City Hall Thursday, as most council and staff members were on vacation.

However, Councilwoman Joy Picus called the fine “very steep” by comparison with similar cases.

“I say that without saying it is too big or anything else. . . ,” Picus said.

“It is certainly in the public interest to have this settled and behind us. It is in all of our interests to have this laid to rest,” she said.

Bradley still is the subject of several investigations, including a federal grand jury probe into his financial dealings.

Questions remain about the Bradley campaign’s handling of tens of thousands dollars in campaign funds raised by a series of inner-city carnivals, some of which were held on city-owned land without proper approvals.

The carnivals, which do not appear to have been clearly identified as political events, may have violated city and state campaign laws, as well as written policy banning political fund-raisers on city property. Bradley has ordered a staff review of the carnivals, and City Council members have also said they intend to probe the events.

Hahn said that he will await a thorough report on Bradley’s campaign finances by the city clerk’s office before determining whether to proceed against Bradley for possible campaign law violations.