Airport Official Did Not Report Stocks in Airlines : Ethics: He held a $45,000 portfolio for more than a decade. Officials raise conflict-of-interest questions.

The Los Angeles airport official in charge of approving environmental clearances for airlines has owned an estimated $45,000 in airline stocks for more than a decade, but records show that he did not disclose the holdings in financial statements filed with the city.

The official, Maurice Z. Laham, has approved requests from at least one of the four airlines whose stock he owned and has made general recommendations affecting all airlines operating in Los Angeles, according to Airport Department records.

In an interview this week, Laham said his ownership of the stock was not improper and did not affect his conduct. After being contacted by The Times, he filed a document with the city clerk’s office disclosing the stocks.

City and airport officials interviewed this week said Laham’s holdings raise conflict-of-interest questions and called for official inquiries into whether he violated the city’s ethics code by owning the stock and state law by failing to report it.

“There seems to be a very close connection between his position and the airlines,” said Councilwoman Joan Milke Flores, who chairs the City Council committee that oversees airports. Laham’s stock ownership is “the very type of thing that the (financial disclosure) law was created to prevent.”

Flores said she intends to ask airport officials to investigate the matter and report to the City Council.

Johnnie L. Cochran Jr., a member of the Airport Commission, said Laham had created the appearance of a conflict of interest and added that he will ask the city attorney’s office to investigate. “We have to be very careful because of the fact that we are the landlord for these airlines,” he said.

Laham, head of the Airport Department’s environmental planning bureau since 1971, is a key decision maker with authority over environmental affairs at Los Angeles International, Ontario, Van Nuys and Palmdale airports. Although the Airport Commission has final authority in all airport matters, Laham makes recommendations on matters that could cost--or save--airlines millions of dollars.

Laham said he sees no conflict between his job and his investments. “I don’t even see that it appears to be a problem,” he said. “If it was gold stock and I was the commissioner of gold, I could see it.”

Laham said he thought he had noted the stocks once on an annual disclosure statement he filed with the city in the 1970s, but added that his memory was vague on that point. Under the state Fair Political Practices Act, government officials in positions such as Laham’s are required to file statements disclosing their financial holdings.

“For years I forgot about the stock,” Laham said when asked why he did not disclose the stocks on statements he has filed every year since 1977. “It was doing nothing and going nowhere. . . . I haven’t traded in so long, it’s like a dormant, dead account.”

Much of the stock was sold last Monday and the rest will be sold shortly, he said Wednesday. In all, Laham said, he owned between $90,000 and $100,000 in stocks, half of which were unrelated to airlines. Proceeds from the sale of all the stock will go to his wife as part of a divorce settlement, he said.

Laham said he purchased half of the airline stock between 1971 and 1973, while he was working for the Airport Department. The rest had been purchased earlier.

Airport Department records show that in August, 1981, Laham approved a request by Western Airlines for environmental clearance of a major remodeling and expansion project at its Los Angeles International terminal. Laham confirmed that he held 103 shares of stock in Western at the time.

Two years earlier, Laham recommended that Western Airlines be granted environmental clearance to install new passenger loading facilities at Los Angeles so that wide-body jets would be able to use two of Western’s gates, records show. Western was acquired by Delta Airlines in December, 1986, and Laham’s stock was converted to Delta stock.

Laham described his approval of the requests by Western Airlines as “almost pro forma .” Other than the Western Airlines matters, Laham said, he does not recall ever taking an action on a specific request from any airline in which he held stock.

Laham also said that his recommendations are reviewed by superiors who make final decisions. “I don’t have anything to hide,” Laham said. “You can’t say I’ve got my hand on the switch. . . . I make recommendations through channels.”

City and airport officials said this week that they know of no evidence that Laham took any improper or questionable action related to Western or any airline, regardless of whether he owned stock in the company.

Laham confirmed that in addition to Western stock, his holdings included:

- 1,250 shares of stock in Pacific Southwest Airlines, which was purchased in 1988 by USAir Group. Under the terms of the takeover deal, half of his stock was converted to USAir and half to PS Group, which owns hotels and leases airplanes, Laham said.

- 200 shares of Texas Air Corp. preferred stock and 400 shares of Texas Air common stock. Texas Air Corp., which now owns Eastern and Continental airlines, changed its name last month to Continental Airlines Holding Corp.

- 100 shares of stock in Tiger International, the parent company of the Flying Tiger air cargo service, which was purchased by Federal Express Corp. in December, 1988.

The total value of all the airline-related stock now is about $45,000, Laham said, about the same value it had when he purchased it.

Laham said he traded heavily in stocks during the 1960s while he worked as a planner in the city’s Planning Department. He said he has not bought or sold any stock since 1980.

At the Airport Department, one of Laham’s chief responsibilities is the processing and approval of environmental clearances required for all airlines under the 1970 California Environmental Quality Act. Airlines must obtain the clearances to increase their landings and takeoffs, build or expand their terminals or make other changes that could affect the environment.

Clifton Moore, general manager of the Airport Department, said that he was unaware of Laham’s holdings and that Laham should have reported them on his economic interest statement.

“We at all times have to be like Caesar’s wife,” Moore said. “Calpurnia was beyond reproach.”

The fact that Laham holds airline stocks would cause him to evaluate his work “with a different vision,” Moore said. “I would recognize that there might be some bias there.” He added that he intended to question Laham about the matter.

Moore said it is not necessarily improper for someone in Laham’s position to own airline stocks. “People have civil rights, I guess, and among those civil rights is the ability to make investments. . . . I guess the only thing improper about it is (lack of) disclosure.”

Under the Airport Department’s conflict-of-interest code, the environmental coordinator--Laham’s position--must disclose any investment in “any business entity which, during the past 12 months, used or proposed to use property owned or used by the Department of Airports.”

The code also requires disclosure of investments in businesses that engaged in construction projects on airport property valued at $1,000 or more in the previous year.

“He was foolish for not disclosing it,” said Jerry B. Epstein, chairman of the Airport Commission. Three other commissioners echoed that opinion; the fourth could not be reached for comment.

Sandra Michioku, a spokeswoman for the state Fair Political Practices Commission, said that any government employee who is required to disclose investments and fails to do so could face civil fines of up to $2,000 per violation as well as misdemeanor criminal charges.

The general code of ethics that applies to all city officials and employees appears to bar Laham from holding airline stock at all. According to the code, employees “shall not make personal investments in enterprises which they have reason to believe may be involved in decisions or recommendations to be made by them.” The code was adopted by the City Council in 1959.

Councilwoman Flores said that Laham should “absolutely not” own airline stock, and at the least should have disclosed it publicly.

Councilman Marvin Braude, who heads the City Council’s Environmental Quality and Waste Management Committee, said Laham “ought to be sensitive enough to report (the stock).”

“If you work for the airport, it seems to me that you have a responsibility not to have investments in airlines,” Braude said.