O.C. Sinks to New Low With a Year of Scandals : Disgrace: A rash of misdeeds--admitted and alleged, public and private--raise questions about current values. : 1992 THE YEAR IN REVIEW. Scandals Plagued The County Like Seldom Before

Perhaps more than any other period in Orange County’s 103-year history, 1992 will be remembered as the year of scandal.

Once christened the Cook County of California--a reference to the legendary corruption in the Chicago area--Orange County outdid itself this year, at least in terms of the staggering sums and variety of allegations involved.

The seemingly never-ending series of unbelievable--and in some instances still unproven--disclosures about brazen financial scams and sexual harassment charges are still reverberating through the county’s criminal justice system.

In a swirl of mink-lined bathrobes, exotic bird collections and monogrammed carpeting, some of the area’s newly notorious figures were clearly up to no good, or at the very least exhibiting unbecoming behavior, according to investigators.

Newport Beach investment adviser Stephen D. Wymer officially kicked off the scandal season early January when he was arrested for embezzling $100 million from city governments, including Orange.

Things didn’t get any better as the year progressed, especially in Newport Beach:

* Newport Beach utility director Robert J. Dixon pleaded guilty to stealing $1.8 million from the city over a 10-year period. He used the money to buy a Jamaican time-share and a wardrobe that included 200 sweaters and 20 umbrellas. Dixon explained his actions by saying that he was “lonely.”

* Newport Beach Police Chief Arb Campbell and his top assistant, Capt. Anthony Villa Jr., were accused of sexual harassment by nine former or current female employees who said the department was “a hotbed” of sexually offensive behavior. One police dispatcher even claims she was raped by the two men. They have denied the accusations and sued the city for conducting a “witch hunt.” The city is in the process of firing both men.

* The Newport-Mesa Unified School District discovered that its chief financial officer--21-year veteran Stephen A. Wagner--had stolen $3.5 million in school funds, including money for children’s lunches, which was wrongly deposited in a secret slush fund and then pilfered. Few appeared to have questioned how he could afford a Rolls-Royce or eccentricities such as a mink tuxedo on his $78,000-a-year salary.

* The Orange County district attorney’s office opened a criminal investigation into Supervisor Don R. Roth’s relations with local business people to determine if he may have accepted thousands of dollars worth of gifts and loans in exchange for political favors. Roth has not been charged with any wrongdoing.

* Three Orange County charities purportedly helping drug addicts, homeless veterans and abused children were just fronts for one of the largest nonprofit frauds in state history, according to investigators. About $8 million reportedly went into organizers’ pockets.

* And Laguna Hills lawyer James D. Gunderson was shown to have inherited millions of dollars in cash, stock and real estate from retired residents of Leisure World, even though the state Supreme Court has long held that attorneys receiving anything more than “modest” bequests (i.e., less than $20,000) from their clients raise questions of impropriety. Gunderson, who denies any wrongdoing, is the subject of four separate investigations.

“It’s been a delightful year,” said mystery writer T. Jefferson Parker, a local resident.

Orange County’s spiritual leaders, psychologists and law enforcement officials say 1992 should stand as a warning: Wagner, Wymer and similar tragicomic figures are proof that materialism and greed have gotten out of check, they say. People have become so obsessed with appearances they’ve lost touch with reality.

“In Newport Beach, everybody wears a mink and nobody wears underwear,” joked one local official.

From some vantage points, this was a banner year for scandal, but certainly not the first time that Orange County has seen its name--and more than a few of its prominent citizens--dragged through the dirt.

Back in the mid-1970s, 43 Orange County politicians and government workers were indicted within a 35-month period on charges ranging from bribery to false voter registration. The game of politics had suddenly changed, in large part because of Watergate.

“1992 has been the worst year since that period of time by far,” said Shirley Grindle, a community activist and former county planning commissioner.

Rabbi Bernie King of Shir Ha-Ma’alot Temple in Newport Beach calls this year’s cast of characters Orange County’s “problem children” who represent the underlying strains of high society.

“A problem child acts out the family’s disease, “ King said. “The family will go to a counselor and say, ‘Our kid is in trouble all the time,’ and a good therapist often will not just deal with the problem child, but with the entire gestalt, the entire relationship of the parents and other siblings.”

Orange County, King said, could use a little family therapy these days.

“I think some of the people uncovered of late are symbolically representative of more than we are aware of--of what’s gone wrong in the area, of the pressure of the value system here,” King said. “There is so much emphasis placed upon how things appear--what home you live in, what type of automobile you are driving, where you shop, the labeling on your clothing--to such a degree I think we forget that the most important thing is building from the inside out.”

Grindle echoed the sentiment.

“The lifestyle in this county has been on a high roll for the last 10 years. Too much money, too much importance placed on material belongings,” she said. “I think it is all catching up with us.”

Nowhere were things worse than in Newport Beach. The city’s critics claim it suffers from a lack of community and is king of the mountain when it comes to “conspicuous consumption.”

“One of the great sociologists differentiated between Gemeinschaft-- the warm, fuzzy, friendly, family-like community--and Gesellschaft, a calculating, impersonal and businesslike atmosphere,” said Newport Beach psychiatrist Park Dietz. “Newport Beach, despite its size and resort-like features, is not a warm place where neighbors get together for barbecues. It’s an impersonal place for people with money who are drawn to the ocean.”

Balderdash! says Newport Beach minister John Huffman.

Huffman, Richard M. Nixon’s former pastor and senior minister at St. Andrew’s Presbyterian Church, said the Newport-Mesa scandal or the Wymer fraud happen everywhere and simply serve as a reminder that each of us is capable of good and evil.

“Any man or any woman, myself included, is capable of wonderful acts of an altruistic nature, and also capable of the most diabolical of attitudes and actions,” said Huffman. “This is the human predicament. Periodically it catches our attention with the headlines.”

What most everyone does agree on is that Orange County’s size and style make it easy for someone here to look like something they’re not. Wagner, for instance, reportedly told people he had inherited money, or scored big on a number of side businesses.

“You couldn’t do this in Helena, Mont.,” said Gilbert Geis, professor emeritus of criminology, law and society at UC Irvine. “Here you disappear into the freeway. . . . There are no neighborly checks, nobody sees your lifestyle.”

Orange County, Huffman said, has more than its fair share of people he calls “$10,000 millionaires.”

“One beautiful, tailor-made suit and a leased BMW and they can look like they’re wealthy,” Huffman said.

Perhaps what was the hardest thing about the year of scandal was the number of community leaders accused or suspected of wrongdoing and the severity of the suspicions--a police chief accused of rape, a trusted school official spending money meant for children’s lunches, a beloved financial adviser under investigation for possibly not behaving in the best interests of his elderly clients.

“I think it’s a disappointment for all of us to see people who guide us--the police chief for example--fall from grace,” said Wesley Maram, an Orange psychologist who has examined both Dixon and Wagner.

Often, those closest to the accused were the most shocked at the scandals. Maram said people in positions of power are often quite likable, having risen through the ranks with a certain degree of charm and panache.

Some of Wagner’s colleagues, for instance, nearly broke down in tears at the outset of the Newport-Mesa scandal, saying such a “nice guy” couldn’t possibly be guilty of spending school funds on fur coats.

“A lot of these people we read about are very moral and correct people. They are not the stereotypical thief by any stretch of the imagination. . . . We’re not talking about sociopaths,” Maram said. “People generally like them because, by and large, they are likable. But we aren’t aware of the underlying features--that secret life they are leading.”

Secret life?

Maram and others say people like Wagner and Dixon never set out to steal but instead found ready access to millions of dollars an easy way to fill some inner void.

“Some people will put food in their face. They become preoccupied with an external interest: ‘If only I get this, I’ll feel better,’ ” Maram said. “A massive art collection . . . or fur-lined bathrobes--whatever they want to perseverate on--that will be their goal. . . . They thought perhaps people would give them love for acquiring things.”

(Maram emphasized he was not discussing any of his patients specifically.)

So in part the lesson is an old one: power corrupts.

“Why should we be surprised when people abuse their positions of power? I don’t see it as a mystery,” Dietz said. “I think the mystery is why so few get caught.”

Municipal Judge Susanne S. Shaw agreed.

“They ought to have a Power Anonymous for a lot of people,” she said.

One bright spot in all of the bad news just might be that high-flying crime isn’t up; it’s just that more people are getting caught. Wagner started embezzling around 1986; Dixon’s looting dates back even further.

The recession has helped unearth some of the scandals. County agencies and school districts living on Easy Street in the 1980s have suddenly been forced to watch every penny as property and sales taxes plummet.

And, at least in the Wagner case, one public servant did good. Some courageous Newport-Mesa employee came forward and informed the county grand jury that the school district’s golden boy might not be what everybody thought he was.

That, said Geis, “is a sign of hope. I wish there were more of it.”

King said 1992 may have been some kind of divine test for us all.

“I’ve always had the notion that if God were testing a group of people, the real test would be wealth and success. Can we have wealth and power and money and influence and use it in a humble, sharing way? If we act arrogantly and abuse our power in those situations, we’ve really blown it spiritually,” he said. “Maybe the Newport Beaches of the world are the great testing grounds. Maybe it’s easier to be poor.”

A Tainted Time

Orange County was rocked by a series of scandals this year, ranging from financial shenanigans to alleged sex crimes. Here are some of the major figures:

Stephen D. Wymer

Position: Newport Beach financial adviser

Case status: Convicted of embezzling $100 million from government agencies.

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Stephen A. Wagner

Position: Former chief financial officer, Newport-Mesa Unified School District

Case status: Convicted of stealing $3.5 million from the district.

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Arb Campbell

Position: Former Newport Beach police chief

Case status: Nine former or current female employees have accused him in civil litigation of sexual harassment. One claims he raped her. Campbell denies the charges but was fired Dec. 22.

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Don R. Roth

Position: Orange County supervisor

Case status: Under criminal investigation by the Orange County district attorney’s office for possible influence peddling. He has not been charged with any wrongdoing.

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Robert J. Dixon

Position: Former Newport Beach utility director

Case status: Convicted of stealing $1.8 million from the city.

Researched by GREGORY CROUCH / Los Angeles Times