ORANGE COUNTYP PERSPECTIVE : Improper Silence

Orange County Counsel Terry C. Andrus was mistaken in not telling his primary bosses, the five supervisors, about the meeting last year in which the Securities and Exchange Commission raised concerns about the risky investment practices of then-Treasurer Robert L. Citron.

Andrus said last week that he did not tell the supervisors about the April meeting because he was worried it could prompt investors to withdraw their money from the county pool and thus damage the school districts and agencies that invested in it.

Andrus should have left that judgment to the supervisors. Their ultimate bosses, and his, are the residents of the county, who have been greatly harmed by the bankruptcy. The supervisors deserved to know that the agency concerned with the stock and bond markets was asking questions. It was not until Dec. 28, three weeks after the bankruptcy filing, that supervisors learned of the meeting.

Citron’s investment policies were the key issue in his reelection campaign, and news that the SEC was concerned would have raised the matter beyond a mere political ploy. It might have prompted the supervisors to look more closely at allegations that Citron, who has since resigned, was taking on too much risk.

Andrus told a state Senate committee last week that after the SEC meeting he was convinced the controversy was political and the investment pool was in good shape. He should have reported to the supervisors. It could have helped them do their job of keeping tabs on Citron’s investments.