Ex-O.C. Official May Face Arrest Soon : Bankruptcy: Former assistant treasurer Raabe has been asked to turn himself in and plead guilty to various charges by next week, sources say.

Former Orange County Assistant Treasurer Matthew Raabe, who reassured school districts and cities that the county’s failed investment pool was sound, faces arrest early next week on even more counts of securities fraud and misrepresentation than his ex-boss, sources close to the investigation said.

If Raabe does not surrender voluntarily and accept terms similar to those offered former Treasurer Robert L. Citron, he will be publicly arrested, the sources added.

Citron implicated Raabe when he turned himself in and pleaded guilty April 27 to six counts of securities fraud and misappropriation of public funds associated with the county’s financial collapse.

Citron faces as much as 14 years in prison and fines totaling $10 million. Prosecutors have insisted that his guilty pleas were not the result of a plea bargain in which Citron was guaranteed leniency.

Raabe’s attorney, Gary M. Pohlson, has been shown the detailed charges that prosecutors are prepared to file against his client.

Raabe, who oversaw most of the day-to-day operations of the treasurer’s office last year and was the most visible spokesman for the investment pool, has until early next week to turn himself in and plead guilty, sources said.

Raabe has not been told to “surrender by Monday” but the looming arrest or surrender “is going to be very, very soon,” one source said. He added that, as in the case of Citron, “there are no deals” being offered.

Citron pleaded guilty and agreed to cooperate with prosecutors and investigators in the continuing investigations by the county, the local U. S. attorney and the U. S. Securities and Exchange Commission, all of which are exploring possible criminal conduct in connection with the loss of $1.7 billion from the county’s $7.4-billion investment pool, which forced the largest municipal bankruptcy ever.

But Citron’s agreement to plead guilty left open the question of whether he will receive a prison sentence. Prosecutors merely agreed as part of the plea agreement not to oppose Citron’s request to be sentenced by a judge in a different county.

If Raabe surrenders and pleads guilty, one source said, he would receive similar treatment. But, the source added, “he has to face the maximum exposure, then he’s got to do the best he can to extricate himself in a court.”

Although sources said Raabe’s lawyers have offered their client’s cooperation with the investigation, his attorneys have not given the district attorney’s office “any indication that he knows much of anything,” the source added.

But “what he has to say may be of importance in evaluating whether or not he has a chance of any kind of mitigation in the future,” one source said.

Pohlson said he met several times this week with representatives of the district attorney’s office but that “we are just kind of in a holding pattern” in terms of progress in the case.

Pohlson acknowledged that he was told last week the nature and number of potential charges against Raabe.

But when asked whether there were 20 counts, as sources indicated, Pohlson said: “That is so ridiculous. It’s absolutely not right. It’s just so far out in left field it’s amazing.”

Pohlson said no deadline had yet been set for his client to surrender or face arrest.

But, he added, “I would think in the next couple of weeks they’re going to do something.” He said he expects to have more information Monday or Tuesday.

Citron met at least three days last week with prosecutors and investigators, but Pohlson said that the district attorney’s office had given him no indication of the nature of Citron’s testimony. “I don’t know what they’re talking to him about,” Pohlson said.

The lawyer would say little about what the district attorney’s office has offered Raabe in terms of any possible deal. But “they have never, ever said anything” about Raabe implicating any other elected officials, Pohlson said. “They have never, ever said anything particular about anybody.”

A friend of Raabe’s, who asked not to be identified, said the 38-year-old CPA strongly believes he only did what he was told to do by Citron and broke no laws.

“He really believes that if he goes to trial, he will win,” the friend said.

Times staff writer Jodi Wilgoren contributed to this story.