Trash Scandal: Cautionary Tale

At long last there is renewed action in the Orange trash hauling scandal. The Orange County district attorney’s office has filed felony charges against Jeffrey Hambarian, whose family has held the exclusive garbage disposal contract for the city since the 1950s.

Hambarian is charged with defrauding Orange of $4 million over 13 years. That raises anew the question of oversight by city officials. If the charges are proven, the long time the illicit activities were undetected would be strong evidence that the city wasn’t exercising sufficient stewardship.

Prosecutors charged Hambarian with crimes ranging from grand theft and commercial bribery to perjury and money laundering. He is alleged to have falsified more than $2.5 million in expenses that were later reimbursed by the city. He also allegedly embezzled money generated from recycling materials.

The city was slow off the mark in looking into complaints about Hambarian, and there are complicating side issues. The police chief at the time the first inquiries began has been fired. Residents became increasingly restless for answers about the scandal. The city manager was handling contract issues with Hambarian’s company, Orange Resource Recovery Systems Inc., after the manager’s wife, a real estate broker, earned a fee by selling a house owned by Hambarian. The city manager denied any wrongdoing.

The district attorney’s office stepped into the probe more than a year ago. Since then, in return for grants of immunity from prosecution, it reportedly has received cooperation from a number of companies Hambarian allegedly used to launder money.

Five years ago Orange gave the Hambarian family a $9.5-million trash processing plant. In return the city was to receive 90% of the recycling revenue for at least seven years. That should have been a strong incentive for the city to keep an eagle eye on the books.

Whatever the disposition of the charges against Hambarian, Orange should be sufficiently embarrassed to enact safeguards against further scandals. This is about local government minding the store.