Ethics Panel Aims Probe at Aide to City Atty. : Government: Investigators search Hahn’s offices as part of an inquiry into alleged payroll irregularities.

Investigators working for the Los Angeles Ethics Commission served search warrants on the offices of City Atty. James K. Hahn Thursday, as part of a criminal probe of alleged payroll irregularities involving the activities of a top Hahn aide, law enforcement sources said.

District attorney’s investigators, who assisted in the raid, carted off computer equipment, files and personnel records during the search, which lasted several hours.

The ethics panel declined to disclose details of the probe, which is believed to be the new watchdog agency’s first major investigation. Executive Director Benjamin Bycel said an investigation of “allegations of possible criminal misconduct” is under way, with the assistance of the district attorney’s office. He indicated that the investigation grew out of a tip received on the Ethics Commission’s “whistle-blower hot line.”

Law enforcement sources said the probe involves allegations that “ghost employees” were carried on the payroll in Hahn’s office and performed political tasks rather than city duties.

The sources, who spoke on condition of anonymity, said one focus of the probe is the activities of Chuck P. Fuentes, a longtime, top Hahn aide and Democratic Party activist.

Fuentes could not be reached for comment.

Mike Qualls, a spokesman for Hahn, said Hahn’s personal office was not searched. He added that Hahn is cooperating in the probe and is not a target of the investigation.

Citing the investigation, Qualls declined to discuss the types of records that were taken or the employees who may be involved. A district attorney’s spokeswoman also said that Hahn does not appear to be a target of the investigation.

Qualls said the city attorney, whose office advises the Ethics Commission on legal matters, was surprised by the search. Sandi Gibbons, a spokeswoman for Dist. Atty. Ira Reiner, said investigators from Reiner’s office became involved because the commission was concerned that there might be a conflict of interest if city police investigators were used. Hahn’s office represents the Police Department.

The search began early Thursday morning when about a dozen district attorney investigators entered Hahn’s executive offices on the top floors of City Hall East.

Gibbons said the investigators were loaned to the city ethics agency because sworn law enforcement officers must serve a search warrant. She said investigators also searched a private residence, the location of which she declined to identify.

Gibbons said the Ethics Commission “requested the district attorney’s assistance on their investigation of personnel in the city attorney’s office.”

She said a district attorney investigator has been working with the ethics agency, but she stressed “it’s their investigation.”

The investigation focuses on a handful of employees who apparently were being carried on the city payroll but failed to show up for work or did political tasks, the law enforcement sources said.

City and state laws prohibit misuse of public resources, including staff time, for private or political purposes. Violations can be prosecuted as felonies, although prosecutions of aides to politicians are rare. Typically, aides argue that any political work they perform is on their own time, during breaks, lunches or after hours.

Some of the workers in question were assigned to various parts of the office, but may have reported to Fuentes, one law enforcement source said.

Investigators are still trying to determine what kind of work the employees were doing, sources said. But it appears the alleged political activities may have involved the Democratic Party, rather than Hahn’s campaigns, one law enforcement source said.

Fuentes is a vice chairman of the state Democratic Party and has served in a number of campaigns, including former President Jimmy Carter’s losing reelection bid in 1980.

Fuentes also has served on Los Angeles County Democratic committees, on the staff of Democratic state lawmakers and has held local appointed and elected offices in Norwalk and Cerritos.

Fuentes stepped in to help manage a 1981 runoff campaign in Hahn’s first bid for public office. He was elected city controller. Fuentes has served in a variety of posts in Hahn’s office where he is currently chief administrative officer.

The criminal probe and search mark a significant milestone for the Ethics Commission, which was created by voters in June, 1990, after ethics controversies involving Mayor Tom Bradley.

The commission, ostensibly given broad enforcement powers to root out waste and corruption, has been slowed in its enforcement by loopholes in the ethics law, legal challenges and the lack of its own legal counsel.

Some critics have suggested the commission needed to prosecute a significant case to establish its credibility. But commission President Dennis Curtis has insisted the panel would move carefully.

Qualls declined to comment on the manner in which the investigation was being conducted, other than to say no informal request had been made for documents before Thursday’s search.