The Wizard Himself Peels Back Layers of His Own Legend

In retrospect.

Those words kept coming from Robert Citron’s mouth Tuesday morning as the state senators asked him in various uncomfortable ways how his Orange County investment strategy resulted in chaos. By morning’s end, the words started taking on a pitiable and hollow sound, for they came to reinforce how little and how late it is to reverse either the county’s debacle or the carnage of Citron’s career.

Here was Citron--proclaimed a financial expert for years both by himself and his fawning Board of Supervisors--now reduced to saying how, “in retrospect,” he would have done a lot of things differently.

Before the fund collapsed and the county declared bankruptcy last month, Citron had what every public figure wants as he nears retirement--a reputation. He was well on his way to a gold watch and a proclamation. But as the questions kept coming Tuesday from the senators, it became clearer and clearer that much of Citron’s reputation was the result of other people’s advice and a string of good luck. Worse than that, he at times Tuesday fumbled for words or was inarticulate when asked about some aspects of state law that relate to the duties of his former office.


When his time behind the microphone ended, just before noon, no one was thinking of Robert Citron as a wizard.

And yet, there was no glee in any of it. He didn’t come across as a conniving, pompous powerbroker; rather, he came to look like the underachiever who had something to prove in the world of big-time money markets and who may have listened too long to the sweet nothings being blown in his ear by Wall Street investors. He seemed to take special pride, for example, in pointing out that the city of Beverly Hills called him twice during a four-month period last year, wanting to get into the pool.

“I never received a college degree,” Citron said in his 15-minute opening statement. He attended USC for three-plus years before dropping out due to financial reasons. “I attended Loyola University for a semester in the early ‘50s to learn about government finance.”

He was a tax collector, not an investment fund manager, when he became county treasurer in 1973. “At that point in time, I was an inexperienced investor. I had never, nor have I ever, owned a share of stock. My primary training was on the job. Due to my inexperience, I placed a great deal of reliance on the advice of market professionals.”


Over the years, he said, he came to consider himself an “experienced and successful treasurer,” but he made it abundantly clear Tuesday that he was guided all along the way by others.

Citron said he considered Merrill Lynch the county’s “financial adviser” during the time the county’s investing patterns grew more complex. To underscore the irony of that, Citron said it was Merrill Lynch analyst Charles Clough who advised him in 1993 that rates would stay low for years--just a few months before the onset of the increases in 1994 that eventually torpedoed the fund. “I understood Clough to be the preeminent expert in the field of investment strategy,” Citron said.

Upon that, it seems, the legend of Robert Citron was built.

Under the cumulative weight of the questions and answers Tuesday, Citron himself slowly began peeling back the layers of his own legend.


When asked if the situation was made worse because he didn’t get varied outside advice, Citron said, “In retrospect, it appears that way.”

State Sen. Lucy Killea asked Citron when he realized the fund was “in serious trouble.”

“I didn’t believe it was in serious trouble until the very, very end,” he replied. He said he thought the fund was set up to guarantee against ever losing any principle.

Eli Broad, a private-sector adviser to the Senate committee, got Citron to concede that he never drew up potential-loss scenarios for sudden market fluctuations or if investors suddenly withdrew from the pool.


Ultimately, Citron made no effort even to protect the turf that everyone had thought was his own. Asked at one point whether the fund would benefit from more supervision, Citron said: “In retrospect, I would presume that a fund such as ours could have a small board of advisers, or people qualified by training and education to advise on what type of investments should be made or on investment policy.”

When he had finished, no one was any longer under the illusion that they had been listening to a guru or genius or wizard . . . or whatever other myths built up around Bob Citron in recent years.

It was left to Sen. Daniel Boatwright to ask the question directly. He asked Citron if he had held himself out as a financial expert to voters in Orange County.

“I thought I was,” Citron said. “Since this situation happened, I must humbly state that I was not as sophisticated a treasurer as I thought I was.”


What we learned Tuesday was that the public had no idea over the years, exactly, who Bob Citron was.

In retrospect, he didn’t, either.

Dana Parsons’ column appears Wednesday, Friday and Sunday. Readers may reach Parsons by writing to him at The Times Orange County Edition, 1375 Sunflower Ave., Costa Mesa, Calif. 92626, or calling (714) 966-7821.