New Torrance Treasurer Already Has a Year on the Job : Government: Linda Barnett is sworn in as the city moves to recover from its loss of $6.2 million in an investment scam.

The Torrance City Council has appointed Linda Barnett as city treasurer, completing the reorganization of a city office that was shaken by the loss of $6.2 million in an investment scam.

The $70-million portfolio has been managed on an acting basis for more than a year by Barnett--formerly the deputy city treasurer--while her boss, Thomas C. Rupert, was on a stress-related leave.

Rupert retired in February after serving 30 years as treasurer. He had long wielded exclusive control over the city’s investment portfolio. In 1991, however, Torrance officials were notified of the city’s multimillion-dollar loss in the investment fraud engineered by Orange County financier Steven D. Wymer.

Rupert was never accused of legal wrongdoing. But he drew fire from council candidates in last year’s elections for making the investment with Wymer, who pleaded guilty last September to defrauding scores of government agencies and pension funds in several states.

After the $6.2 million disappeared, city officials began scrutinizing the remainder of Torrance’s investments and learned that a separate $1-million investment in a program of multifamily real estate mortgages violated city guidelines. The city has sued to recover the money from American Insured Mortgage Investors-88.

The Wymer controversy sparked a series of changes in how the city invests its money. The city hired an accountant to track the paperwork of investment transactions, tightened its investment policy and created an advisory committee to increase accountability and communication between the treasurer and other city officials.

Had such measures been in place before the Wymer investment, the $6.2 million might not have been lost, Barnett said.

“It could have been caught,” she said.

Officials at Tuesday’s council meeting praised Barnett’s role in revamping the city’s investment policies. Barnett “helped set up the process so that the council and the community could feel more comfortable on our investments and the risks therein,” Councilwoman Dee Hardison told the council.

Barnett, 45, grew up in Torrance and has worked for the city full time for 16 years, serving the last nine years as deputy city treasurer. She is married to Gene Barnett, Torrance’s Parks and Recreation director.

The council unanimously selected Barnett over two other applicants--Torrance residents John J. Pavlin, a management consultant, and Martin F. Schmidt, a financial manager--and she was immediately sworn into office.

The post comes up for election in March, 1994. Barnett left no doubt that she plans to be on the ballot. “I will run in 1994,” she said. “I don’t intend to lose.”