Raabe Trial Is Delayed for Prosecutor Switch

The trial of former county Assistant Treasurer Matthew R. Raabe was unexpectedly recessed for a week Monday because the prosecutor had to quit the case to take care of a family emergency, according to the trial judge.

Superior Court Judge Everett W. Dickey told jurors to return to court next week and that the one-week recess was needed to give the new prosecutor, Assistant Dist. Atty. Jan J. Nolan, time to review trial transcripts.

Senior Deputy Dist. Matthew Anderson, who completed the prosecution’s case two weeks ago, reportedly had to rush to Virginia over the weekend to be with his ailing father.

Anderson called 22 witnesses, including former Treasurer Robert L. Citron, to buttress the government’s case that Raabe diverted interest earnings from the Orange County investment pool into the county treasury.

One of his motives, Anderson argued, was to conceal from the pool’s outside investors the highly risky--and sometimes highly lucrative--investment strategy that Citron pursued in managing a $7-billion portfolio.

Raabe’s attorneys were expected to begin their case Monday, but Dickey said the defense’s opening arguments will have to be delayed to allow the switch in prosecutors.

Dickey told jurors that Nolan, one of the top administrators in the DA’s office, was familiar with issues in the case but needed time to review hundreds of pages of transcripts.

Nolan played a key role in the criminal investigation arising from the county’s bankruptcy, which occurred in late 1994 when Citron’s bets on the movement of interest rates proved wrong, causing the the pool to lose $1.6 billion.

She headed a team of prosecutors who presented evidence to the county grand jury that eventually indicted Raabe and former Budget Director Ronald S. Rubino. Nolan also served as the prosecutor in the trial of Rubino, who was accused of aiding and abetting the interest-skimming scheme.

After a jury deadlocked last summer in favor of acquittal, 9 to 3, Nolan and Rubino’s lawyers worked out a plea agreement in which the former official pleaded no contest to a single felony charge accusing him of violating a public records law.

Rubino was sentenced to two years of unsupervised probation, and 100 hours of community service. The sentencing judge told Rubino that he could return in a year and have his record wiped clean with a not guilty plea if he had successfully complied with the terms of his probation.

Raabe’s attorneys are expected to take a week or less to present their case. Apart from maintaining that the county was under no obligation to distribute all of the interest earned by the Citron-run pool, the defense attorneys have argued that Citron and other county officials had routinely “smoothed” or “spread” interest for years to avoid highs and lows in the yields, and that the procedure was not deemed improper.

Last week, Dickey denied a defense motion to dismiss the charges against Raabe, ruling that state law required that pool investors were entitled to all of the interest their deposits earned for the investment pool.