Citron Paints an Amazing Picture : Discredited Orange County treasurer tells his side of the debacle

The pathetic parade of self-described victims in Orange County’s financial fiasco was headlined in Sacramento this week by former Treasurer-Tax Collector Robert L. Citron, who broke a long silence with testimony that at times tested believability.

Was Citron an unsophisticated money manager lured into unwise investments by the wolves of Wall Street, as he sought Tuesday to suggest? Or was he a knowing investor whose savvy was demonstrated by a long record of success? Whatever Citron was, it’s now obvious that far, far too much was staked on the false assumption that he had matters under control.

Citron became one of a string of county officials who have tried to shift the blame to others since the crisis arose. Nonetheless, he had to admit this week before the state Senate Special Committee on Local Government Investments that he bore a heavy responsibility. And inadvertently, it seems, his testimony made clear that he violated his sacred trust with voters.

In 1994’s fiercely partisan political race, a challenger to Citron’s reelection bid raised questions about the county’s investing. The Citron candidacy turned on a single question: Was he prepared to protect his investment fund by changing his risky strategies if interest rates continued to climb? His answer, given credibility by a solid record, was an unqualified yes. The Times Orange County Edition reported April 30 that Citron and his assistant, Matthew R. Raabe, said that they believed interest rates would level off but that if this didn’t happen they had a contingency plan.

On Tuesday Citron admitted he never had such a plan and, in fact, never had analyzed what would happen if interest rates rose or investors withdrew. The truth is out. Citron’s case for reelection was based on misrepresentation.

Citron is of course not the first official to deceive voters and unfortunately won’t be the last. But there’s an indisputable lesson that keeps repeating itself in this fiscal disaster: Investing public money requires more than assurances that matters are well in hand; it needs strict oversight and regulation by accountable officials.