ORANGE COUNTY IN BANKRUPTCY : Lawyer Says All of O.C. Biased Against Raabe

Felony indictments accusing former Assistant Treasurer Matthew Raabe of causing Orange County’s bankruptcy should be thrown out because prosecutors and the grand jury are biased, his attorney said Friday.

Defense attorney Gary Pohlson said the unprecedented bankruptcy has touched all county workers--including prosecutors in the Orange County district attorney’s office--and all county residents, including those who sit on the Orange County Grand Jury.

“They’ve all been impacted,” Pohlson said, declining to discuss in detail the conflict-of-interest motions he intends to file in upcoming weeks.

Raabe was indicted in May on six felony charges that he and former Treasurer-Tax Collector Robert L. Citron deceived unsuspecting school districts, cities and public agencies into sinking money into the ill-fated county investment pool.

Citron has already pleaded guilty to the charges and awaits sentencing.

Raabe’s lawyer said he plans to file legal documents to remove prosecutors from the case and throw out the grand jury indictments against his client, who is accused of misleading those who placed money in a county-run investment pool that eventually lost $1.7 billion, triggering the bankruptcy.

Prosecutors, who have not returned phone calls seeking comment, in the past have insisted they can fairly handle the case and contend that the grand jury indictments are valid.

The complexity of the case means Raabe is not likely to go on trial until 1996.

Pohlson said he also intends to seek a change of venue for Raabe based on the theory that potential jurors in the case also are affected by the bankruptcy, making it impossible for Raabe to receive a fair trial.

The defense also plans to ask Orange County Superior Court Judge Everett W. Dickey to throw out prosecution evidence collected in the case.

A hearing on the defense motions is set for Sept. 15.

At a hearing Friday, Dickey returned Raabe’s driver’s license with restrictions on where and when Raabe can drive.

“It’s been hard for him to get around without a license,” Pohlson said. “Now he can drive to and from my office, his therapist, church.”

Prosecutors labeled Raabe a flight risk and sought to have his driver’s license seized after Raabe allegedly tried to dodge police who were following him. Prosecutors did not object to the decision to return the license, Pohlson said.