It’s the Year of Newport Beach Vice : Scandal: The city is abuzz over allegations of sexual misconduct in the Police Department, embezzlement by city officials and a sinking economy.

Betty Seamans has seen her share of characters drift through her 24-hour coin-operated laundry, from the downtrodden to the rich who bring their Armani shirts in chauffeur-driven limos. She has found homeless people in dryers and naked women waiting for their clothes to dry.

It takes a lot to shock this queen of “Fluff and Fold,” who offers such philosophic tidbits as, “Laundry’s a great common denominator; everyone needs clean clothes whether they do it on a rock by the river, or I do it.”

But hard times and a trio of scandals in upscale Newport Beach have grabbed even Seamans’ attention.

“I think the old adage is true: Where there’s smoke there’s fire. . . . And that about covers my deep wisdom,” said Seamans, scanning the morning newspapers.

From the marble corridors and koi-stocked ponds at Fashion Island to the beer bar funk of Blackie’s by the Sea, Newport Beach has been racked this year by a welter of economic woes, white-collar crime and the worst controversy in the history of its Police Department.

Recessionary pressures have forced a $10-million cut in the city’s $100-million budget, and defense contractors want $2.4 million in wrongly collected sales taxes returned. Former utilities director Robert Dixon financed an ostentatious lifestyle with almost $2 million stolen from the city.

Police Chief Arb Campbell and one of his top assistants stand accused of rape and sexual harassment. And last week, a high-ranking school district official with a fondness for mink and the debt of a leveraged buyout gone sour came under investigation after a fellow employee discovered a $57,000 check written on the district’s health benefits fund to a shoe repair company the official owns.

For the city, already dubbed “ Cote de Fraud” and the bunco capital of the nation, none of these recent scandals has bolstered a reputation for fiscal responsibility or its image as the one-time home of actor John Wayne.

“It bothers me personally,” said Paul Burnett, co-owner of Surfside Sports near the Newport Beach Pier, “but my customers don’t really care. They’re more concerned about a city ordinance to ban skateboarding on the boardwalk.”

From the grade school car pool drop-off to the venerable Balboa Bay Club, reaction to the dismal current events shifts as much as the wind in a spinnaker sail on the city’s pleasure boat harbor, the nation’s largest with 9,000 craft.

Home to beach-loving college students, middle-class families and harried careerists, the city still boasts an average per capita income of almost $60,000, with a median-priced home approaching $550,000. In his latest novel, author Joseph Wambaugh called Newport a place where an ordinary Mercedes is “considered a Chevy Nova.”

Buck Johns, president of Inland Group Inc., is a developer based in Newport Beach and active in the Republican Party. He grants no special importance to the round of bad news pummeling the city.

“I think these things kind of go in cycles, you know. Bad things come in threes, but it seems like bad things are coming in fours for Newport. I attach no real significance to it,” Johns said.

The city’s latest cycle of problems began shortly after New Year’s Day when Dixon, 48, a trusted employee and director of the utilities department, was arrested in connection with a 10-year-old scheme that drained the municipal treasury of more than $1.8 million.

Police said Dixon submitted phony purchase orders to the city’s finance department. When a check was issued, he collected it, forged a signature and deposited the money into his own accounts.

Over the years, Dixon bought a new BMW, gold cuff links worth $120,000 and a $250,000 wardrobe that included 600 sweaters, 60 wool scarves and 20 umbrellas. He thoroughly indulged his taste for artistic black-and-white photographs from the 1920s and 1930s, amassing a collection of 220 pieces worth an estimated $400,000.

In June, Dixon pleaded guilty to two felony counts of embezzlement and was sentenced to four years in prison. He also was ordered to pay restitution to the city.

“Newport Beach has always had a tremendous image throughout the country. It is unfortunate that guys like him have smudged the name,” said Richard Luehrs, president and chief executive officer of the Newport Harbor Area Chamber of Commerce.

Although Dixon caught civic leaders by surprise, the city’s budget woes did not. Anticipating the impact of the recession on sales tax revenue and state funding, municipal leaders began planning a year ago to trim the city’s $100-million annual budget.

They saved more than $10 million by reducing working hours, postponing capital improvements, laying off maintenance workers and refusing to fill 20 vacant positions.

Then, on Sept. 24, three female employees and a fired officer sued Police Chief Arb Campbell and Capt. Anthony R. Villa Jr., the chief’s close friend and partner in a real estate deal. The women charged that they were sexually harassed on and off duty by Villa, and that Campbell condoned the behavior.

Villa was accused of touching breasts, making sexual overtones and using suggestive remarks that included graphic descriptions of a pornographic movie he had seen.

At a news conference two weeks later, a fifth employee, dispatcher Peri Ropke, joined the lawsuit and publicly accused Campbell and Villa of raping her 11 years ago during a raucous party held by the Police Department at an Irvine landfill.

An attorney for Campbell and Villa denies the rape charges against his clients and any sexual relationship involving the three, scoffing at Ropke’s contention that she had an earlier affair with Villa as “fantasy.”

Now, a month later, Stephen A. Wagner, 40, the boyish finance officer for the Newport Mesa Unified School District, has come under investigation for the $57,000 check he wrote last year to Cobbler Express Corp., a shoe repair business he co-owns. The school board moved to fire Wagner last week for improperly diverting money from the health benefits fund to a company Newport Mesa has never done business with.

“That check would have bought a lot of books,” said a librarian who is working at two schools in the district to keep up her hours after cutbacks and a huge budget shortfall.

At the Allen Edwards Hair Salon in Newport’s most posh shopping center, Fashion Island, salon co-owner Frank Chirico is saying that few of his clients really talk much about the city scandals, but that he questions why it took the women employees of the Police Department so long to make their allegations.

“I have more people talking about the election; every one of my clients mentions that,” said Chirico, pumping up the cutting chair and snipping a woman’s wet bangs. “People are negative. They’re not so much voting for someone as voting against someone. It’s how the world is. All of this stuff is.”

Mary Bryant, a neighbor of the police chief on the pricey Balboa Peninsula Point, said she has difficulty believing the charges against the chief.

“I see him at the beach,” Bryant said. “He is helpful, thoughtful, friendly and a real nice guy. I see him in the summertime, see him at the beach with his grandchildren. Personally, I don’t feel he is guilty. It’s a witch hunt in a way. Obviously something is going on, but I don’t know.”

The tony Balboa Bay Club is a kind of fun zone for the well-to-do on Lido Channel off Pacific Coast Highway. Like the rest of the city, it has been a rough year for this high-end establishment, with public opposition at least temporarily halting ambitious expansion plans.

To add insult to economic injury, Police Chief Campbell, good friend and drinking buddy of Balboa Bay Club President Tom Deemer, has been making too many headlines lately.

“I don’t know the women, but I do know Arb Campbell,” Deemer said. “I would trust him with my wife, my house, my business, my money and my hunting dog. . . . As far as I’m concerned (you are) innocent until proven guilty. He couldn’t have done what he is accused of.”

Blackie’s by the Sea is a rustic beer bar near the Newport Beach Pier. The snout of a 10-foot hammerhead shark caught near the mouth of the Santa Ana River angles menacingly into one booth. A barracuda is above the beer cooler, and a sea turtle hangs over the bar in the rigging of an old harpoon.

“A lot is what you read,” said Mike Kelly, the bartender. “I don’t know what is true till it all goes all the way through to the end. But it’s a shame. The Police Department gets such a bad rap. They have a tough job as it is. They don’t need something like this. It’s got to hurt morale.

“Dixon, now that was incredible,” Kelly said. “People really talked about that around here.”