Moreno Verdict: Guilty on All Counts

A federal jury on Tuesday convicted Santa Ana Councilman Ted R. Moreno on 25 counts of extortion, money laundering and mail fraud stemming from an elaborate scheme to win majority control on the City Council.

The conviction caps a four-year case in which Moreno, 33, accepted cash from a gas station owner with the promise of helping him secure a beer and wine li

cense; Moreno used the money in an unsuccessful attempt to elect several political allies to the council.

The case polarized the community, with some Latino leaders arguing that the outspoken councilman was unfairly singled out.

Moreno, the youngest person ever elected to the Santa Ana council and once a rising Latino political figure, slumped in his chair and bowed his head just before U.S. marshals handcuffed him and escorted him to a Los Angeles detention center.

U.S. District Judge Gary L. Taylor rejected Moreno’s pleas to remain free until his sentencing after a grave warning issued Tuesday by Santa Ana Police Chief Paul M. Walters, who told the court that fellow council members feared the conviction would push Moreno “beyond the edge psychologically.”

Walters testified that colleagues have become increasingly concerned about Moreno’s behavior in recent months--so much so that they requested that an armed guard be stationed at the council chambers for protection if Moreno remained free on bail.

The six-man, six-woman jury deliberated nearly two days before returning guilty verdicts on all charges against Moreno, who was accused of taking at least $31,000 in illegal campaign contributions.

Jurors said their deliberations went smoothly, with members of the panel quickly agreeing that Moreno broke the law and should be punished.

“It was not a decision that was taken lightly. But I felt we came to the only decision we could,” said Caroline Cosgrove, a Cal State Fullerton employee who lives in Placentia. “The prosecution gave us a lot of evidence, which they backed up.”

The three-week trial turned largely on the testimony of an FBI informant who recorded himself on audio and video tape giving Moreno thick, cash-laden envelopes. In one grainy black and white tape, a jubilant Moreno high-fived the informant after being given $2,500.

Prosecutors said that the “high-five” recording, which jurors asked to view during deliberations, was pivotal in proving that Moreno eagerly pursued the plan.

“That high-five captured the spirit of Moreno. He was glad to be there. It was part of business as usual,” said Assistant U.S. Atty. John Hueston.

Moreno, who faces up to nine years in prison, declined to comment, but his attorney said the verdict is an unwarranted blemish on the record of a loyal public servant.

“It’s a very sad day for Mr. Moreno and his family,” said attorney Dean Steward. “He’s been a public servant since 1992, and he’s practically a lifelong Santa Ana resident. He was heard on one of the tapes talking about his love for the city--and I don’t think anybody disputes that.”

During the trial, the councilman defiantly took the witness stand, arguing that he was a victim of entrapment by overzealous FBI agents. Moreno said he only accepted the money because he was afraid the FBI informant would “destroy” him.

But one juror, a 65-year-old Lake Forest mechanical engineer who asked not to be identified, said Moreno’s testimony backfired.

“I think Moreno shouldn’t have taken the witness stand,” he said. “He was pushing for the ‘he was threatened’ angle. . . . The video completely negated the threat concept.”

Still, supporters expressed anger at the verdict and said Santa Ana was losing an official who spoke for the poor of the city, many of them Latino.

“I just think it’s a sad day for the Hispanic community,” said Mike Estrada. “Ted Moreno is a good man and a good voice for Santa Ana residents. We will miss him.”

Under state law, Moreno must now be stripped of his council member status. City officials on Tuesday suspended Moreno, meaning he will no longer receive his salary and his access to City Hall. He will be formally removed from office after the judge officially enters the conviction into the court record in December.

Stripped of Office Under State Law

Moreno was indicted in 1998 along with three of his political allies after a two-year federal investigation uncovered the alleged plot to take political control of the city. Moreno’s allies--former councilman Tony Espinoza, and failed council candidates Roman Palacios and Hector Olivares--eventually pleaded guilty to lesser charges, leaving prosecutors to focus their case on Moreno, whom they called the scheme’s mastermind.

He was charged with shaking down businessmen for donations to his campaign and those of his allies running in the 1996 council election. Prosecutors said Moreno wanted to head a majority voting bloc that would dramatically shift the city’s political power structure.

The FBI investigation was triggered after Moreno met Santa Ana gas station owner Vaskin “Victor” Koshkerian. The FBI informant agreed to pay Moreno thousands of dollars in exchange for his support on his liquor license permit. Over a six-month period Koshkerian made more than 77 audio and video tapes of their meetings.

Moreno often laughs and jokes with Koshkerian on the tapes, many of them recorded in expensive restaurants or Moreno’s modest home in Santa Ana. In one video, Moreno takes from Koshkerian a bulging envelope and correctly estimates the $2,500 total.

“My hand knows the weight,” Moreno quips.

Throughout the trial, Moreno claimed that Koshkerian induced, then threatened him to honor the deal. Koshkerian, he said, was a paid government informant who used a clever mix of flattery and threats to lure him into something he would not have done otherwise.

Prosecutors called Moreno a corrupt, ambitious politician who would do almost anything to gain control of the council, including peddling votes for cash. Expecting Moreno to argue entrapment, prosecutors said they gave him plenty of opportunities to refuse the money, but he never did.

Indeed, Moreno, they say, drove the deal, calling Koshkerian repeatedly and frequently asking, even begging, for more money. “He wanted the deal just like he wanted the cash--because he wanted power,” said Assistant U.S. Atty. Jean Kawahara.

The Koshkerian testimony constituted the major part of the government’s case against Moreno. But the councilman was also convicted of filing false campaign reports, lying to FBI agents and laundering more than $20,000 in cash and gold given to him by a Santa Ana landowner.

Prosecutors said their use of an FBI informant, whom they paid $53,000, was necessary to crack the case.

“Undercover operations are sometimes the only way to penetrate conspiracies of silence,” said U.S. Atty. Alejandro Mayorkas. “There was an agreement among these politicians to maintain silence.”

Moreno backers bemoaned the loss of a politician they called their lone voice on a council dominated by business interests. They say Moreno spoke for the humble and poor of the city and fought big development projects.

“The prosecution made a big deal about Ted attempting to take over the city. But what does any politician try to do?” said Sean Mill, a longtime Moreno supporter. “He’s going to end up going to jail because he stood up to the bullies for us. He was standing up for those who don’t like the status quo.”

But prosecutors dismissed charges that they singled out Moreno for prosecution, saying the councilman’s actions instigated the probe, not federal agents.

“The government doled out cash in response to requests by Moreno,” said Mayorkas. “The fact he was convicted on all counts speaks quite strongly to the strength of the case.”

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To view a complete report on the Moreno case, including the FBI videotapes shown to the jury, go to the Times Web site: https://www.latimes.com/moreno

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SANTA ANA REACTION

Some residents expressed sadness or sympathy, others anger at the councilman. A18

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Key Dates in Case

November 3, 1992 - Voters elect Ted R. Moreno to Santa Ana City Council

November 1994 - Moreno allegedly begins vote peddling, money laundering

November 5, 1996 - Voters reelect Moreno to council

Aug. 25, 1998 - Federal grand jury indicts Moreno on political extortion charges

Nov. 3, 1998 - Moreno loses mayoral race to incumbent Miguel A. Pulido

July 14, 2000 - City attorney rejects Moreno’s attempt to circumvent term limits by resigning from council

Aug. 23, 2000 - Moreno testifies FBI informant coerced him to accept bribe

Sept. 5, 2000 - Jury finds Moreno guilty on all counts, city attorney suspends him from council