Schabarum Gets Probation in Plea Bargain

Saying he’s too old and too concerned about the “political” fallout to endure a criminal trial, former Los Angeles County Supervisor Pete Schabarum pleaded no contest Wednesday to three counts of felony tax evasion stemming from his use of money from a nonprofit foundation he controlled to pay for personal vacations to exotic locales.

The 68-year-old Schabarum, who stood ramrod straight but entered his pleas in a near whisper, was sentenced by Superior Court Judge Charles E. Horan to three years’ probation. The onetime leader of the national movement to impose term limits on elected officials also was ordered to perform three years of community service and to pay more than $65,000 in restitution, back taxes and penalties to the foundation and other entities.

As part of the plea agreement worked out between his lawyers and prosecutors, Schabarum agreed to dissolve the Foundation for Citizen Representation that he established after retiring from public office in 1991. He was indicted in February on charges that he illegally misappropriated about $50,000 from the foundation to take trips to Africa, South America, Europe and elsewhere, some of them with his wife.

For their part, prosecutors agreed to drop theft and perjury charges against Schabarum, who served as a county supervisor for almost 20 years and as a state assemblyman before that. Conviction on the theft charges could have sent him to prison for more than five years; the tax evasion counts carried a potential two-year penalty.

“It is a sad day for a man who appears to have led a distinguished career in public service, to have to end his career this way,” said Deputy Dist. Atty. Susan Steinfeld, one of two Special Investigations Division prosecutors who led the two-year probe into Schabarum’s activities.

She and other political corruption prosecutors said Schabarum’s no-contest pleas are significant--and the first in recent memory for someone of his political stature in Los Angeles.

The case was believed to be the first major test of state laws specifically created to prevent politicians from cashing in personally on their potentially huge campaign war chests once they leave office. The law says that elected officials can use unspent campaign contributions to set up a nonprofit foundation, but that the money must only be used to further the foundation’s goals--not for personal expenses.

“In the long run,” Steinfeld said, “he did that, exactly.”

Schabarum’s foundation was set up to further political education. But in the indictment--handed down by the same county grand jury that he once chaired--Schabarum was accused of intentionally skirting the laws by funneling about $50,000 from his foundation through another foundation associated with the Los Angeles County Museum of Natural History, with the express intent of using the money to pay for his personal trips.

Marcus Rodriguez, who at the time was a top museum official and controlled the museum foundation funds, unwittingly aided Schabarum in that scheme, prosecutors alleged.

That amounted to theft on Schabarum’s part, prosecutors said, and since Schabarum never paid income tax on the money or reported it as income, the grand jury also indicted him on tax evasion and perjury charges.

Had the case gone to trial, prosecutors planned to call Rodriguez to testify--as he did before the grand jury--that Schabarum set the whole scheme up to effectively launder his foundation funds.

Court records show a correlation between the money transfers into and out of the museum foundation and then to Schabarum’s travel agent. But Schabarum’s lawyer, John Barnett, sharply criticized prosecutors Wednesday for relying on the testimony of Rodriguez, who is serving a seven-year prison term for unrelated acts of embezzlement.

The plea bargain arrangement was worked out in secret, and a special court date was scheduled to allow Schabarum to enter his pleas.

Usually brash and outspoken, the San Gabriel Valley Republican declined to comment at length on the pleas. Asked by the judge if he was aware that his no-contest pleas would go on his record as felony convictions, Schabarum said only, “Yes.”

“I have no reputation” left, Schabarum said as he left the almost empty courtroom. Later, in a brief interview, he added: “I’d like to have the whole thing behind me, and out of my life.”

But Barnett accused the district attorney’s office of selectively prosecuting Schabarum because of his politically unpopular stance on term limits. Obtaining a conviction only on tax evasion charges, the defense attorney said, amounted to a waste of prosecutorial time and effort, as well as of public money.

The plea bargain, Barnett said out of court, amounts to a “complete vindication” of his client.

“He did this to avoid a protracted criminal trial,” Barnett said. “They charged him with grand theft and perjury, and at the end of the day, after thousands of man-hours of investigation, it comes down to an accounting problem.”

Barnett told the judge that Schabarum entered the no-contest pleas because he “is 68 years old, and he didn’t feel like he’d want to put his family through a long and protracted political trial.”

Prosecutors heatedly disagreed. “This is a convicted felon, three times, and he’s saying it’s a vindication?” Steinfeld asked. “That’s preposterous. The tax charges encompass all of the allegations, since he would not be responsible, not liable, for taxable income if he had not taken the money from the charitable trust and personally benefited from it,” Steinfeld said.

As for Barnett’s contentions that Schabarum is guilty only of innocent “accounting” problems, Steinfeld said: “This is a man who ran the county budget and its billions and billions of dollars for 20 years, and now he says he doesn’t understand finances and that he was going on the advice of others? He’s not accepting personal responsibility, when of course, he should be. He’s the one who did this, knowingly, intentionally.”

Barnett also said he will try to have the convictions downgraded to misdemeanors once Schabarum completes his community service. Because Schabarum suffers from vision problems that could cause him to go blind, he is expected to do his community service at the Braille Institute or at the Boys and Girls Club of El Monte.