Suit Says Executives Looted Firm : Courts: Garamendi says officials of the Calabasas insurance company filed false financial reports to hide its failing condition.

State Insurance Commissioner John Garamendi has accused five former officials of a defunct Calabasas insurer of looting the company’s assets, rendering it insolvent.

A civil suit by Garamendi, filed Wednesday in U.S. District Court in Los Angeles, charges the five former principals of First California Property & Casualty Insurance Co. with racketeering, fraud, conspiracy, breach of fiduciary duty and negligence. It seeks unspecified damages.

The five former officials of First California named in the suit are Edward T. Mines, who was the insurance company’s chief executive; former President John G. Dupuis, and former Directors Charles C. Caldwell, Harvey J. Lambert, Jr. and Wallace B. Hudson.

Beginning in 1988 and continuing through at least October, 1989, the suit alleges, the defendants carried out a series of schemes to take control of First California and then use investments and transactions with affiliated companies to “loot its assets for their own benefit.”

The suit also accuses the former insurance executives of filing false financial reports and participating in several fraudulent business deals in order to conceal the company’s true financial condition.

Their actions ultimately caused the insurer to fail, the suit contends. In October, 1989, First California was seized by then-Insurance Commissioner Roxani Gillespie.

Wells Fargo Bank and securities broker Merrill Lynch, Pierce, Fenner & Smith were also named in the suit, but they were not included in the racketeering charges.

A Wells Fargo spokeswoman said she could not comment on the suit because she had not seen it. Other defendants could not be reached for comment.