ORANGE COUNTY PERSPECTIVE : A Warning to All Cities

The stunning embezzlement case involving a top Newport Beach administrator provides an occasion to remind cities that they must be ever on guard against fraud.

Newport Beach had sound oversight procedures in place that should have worked. Now that it is clear they didn’t, the city has promised that even tighter procedures will be instituted--a change that is essential. Sadly, city leaders also will have to become less trusting--even of those who have long proven themselves good employees.

Auditors say they are still uncovering the extent to which city Utilities Director Robert J. Dixon may have dipped his hand into public coffers. The losses, it is feared, may top $1.2 million.

Dixon is expected to be arraigned Friday.

It has come to light that Dixon, 47, was accused in the early 1970s of embezzling $83,000 from Georgetown University when he was employed there. In hindsight, that should have kept Newport Beach from ever putting him in a position of trust. But City Administrator Robert L. Wynn said he believed that Dixon’s trouble in the ‘70s was just the result of a youthful mistake. Dixon had made restitution to the university and had fully disclosed his past to Newport Beach.

In the last two decades, Dixon earned widespread respect by working his way up from stock clerk to an $86,000-a-year job as a front-line administrator. He was even among the finalists for the job of city manager.

Instead, Dixon is now in jail and auditors are combing through records to assess the damage. Once it’s clear how the alleged fraud was carried out, they will recommend procedural changes.

Auditors concede that almost anyone who is smart, patient and knows the system can abuse it. Cities must be ever on the alert.