ORANGE COUNTY IN BANKRUPTCY : Raabe Makes a Hearing but Stays Silent

Medicated and weak from weight loss and lack of sleep, suspended Orange County Assistant Treasurer Matthew Raabe emerged at a special legislative hearing Friday after weeks of dodging authorities who have been trying to serve him with a subpoena.

But the beleaguered bureaucrat continued his silence on Orange County’s financial crisis, refusing to testify before a special state Senate committee.

Raabe had agreed to show up at the panel’s special session at Irvine City Hall, his attorney noted afterward. He’d never agreed to say anything.

“There’s no sense talking about it to the special Senate committee. There’s no possible benefit to Matt. There’s no benefit to the community,” said lawyer Gary M. Pohlson.

“We haven’t been able to trust what’s been said by the politicians,” Pohlson added, citing legislators’ accusations that Raabe perjured himself in previous testimony and ducked repeated attempts by Senate authorities to serve him with a subpoena. “They haven’t treated him fairly. There was no reason to talk to them.”

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After hearing that the committee would not grant him immunity from criminal prosecution, Raabe, 38, offered just two sentences to the state senators, who had traveled from Sacramento to hold the special committee’s fourth hearing in one of the cities hardest hit by the financial crisis.

“I do not choose to testify under these conditions,” he said quietly.

“Have I understood your response in a negative sense?” asked state Sen. William A. Craven (R-Oceanside).

“That’s correct,” Raabe muttered.

The attorneys sitting on either side added, virtually in unison: “Yes, it was.”

A sergeant-at-arms from the state Senate drove Raabe and Pohlson to the hearing Friday morning and escorted them into the City Council chambers, where Raabe sat with glazed eyes and a drooping head during his brief appearance.

Raabe, who has lost 15 or 20 pounds and grown a beard since the crisis began three months ago, has been staying with relatives because he cannot care for himself, Pohlson said.

“Is he sick? He looked like he was limping,” Sen. Tom Hayden (D-Santa Monica) asked an aide after Raabe’s abrupt exit.

Watching the testimony on television, Supervisor William G. Steiner agreed. “He looked terrible,” Steiner remarked, “like a beaten man.”

Indeed, Pohlson said Raabe was taking medication prescribed by his psychiatrist. “He’s obviously got a lot of stress. He’s not sleeping, and that kind of thing. It’s hard.”

A county employee since his graduation from college in 1984, Raabe was promoted to the No. 2 spot in the treasurer’s office in 1993, but was removed from his post in January after accountants discovered improper transfers in the county’s investment pool. This week, the county’s chief executive officer, William J. Popejoy, set in motion the process for firing Raabe altogether.

Lawmakers were irked, but hardly shocked, at Raabe’s decision not to testify.

“If I was his lawyer, I’d tell him not to testify either,” said Sen. Quentin Kopp (I-San Francisco), who earlier accused Raabe of lying under oath during his Senate testimony in January.

“We thought there had been a change of heart,” state Sen. Lucy Killea (I-San Diego), the committee’s co-chair, said during the lunch break. “But obviously there was just a change of tactics.”

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Pohlson said he saw no point in cooperating with the legislators, accusing them of political posturing. He said he has been in daily contact with the Orange County district attorney’s office, which is pursuing a criminal investigation of the crisis.

“That’s where we’re looking to tell the stories,” Pohlson said. “There’s no reason to deal with these people.”

But that sentiment increased the panelists’ ire.

“I’m angry. I want to get to the bottom of what happened,” Hayden said. “It appears to be a flagrant misuse of power and violation of the law. You’re talking about a breakdown or meltdown of government. This was it and (Raabe) was there.

“If you’re not angry about this,” Hayden added, “you’re on another planet.”

Times staff writers Lee Romney, Debora Vrana and Greg Hernandez contributed to this report.