Editor's note: This corrects an earlier version. Jeffrey Hubbard was not arrested and was not in jail.
Newport-Mesa Unified School District Supt. Jeffrey Hubbard was charged Thursday with two felony counts of misappropriation of funds related to his previous job in Beverly Hills, according to the Los Angeles County district attorney's office.
The charges, listed in a criminal complaint filed at the Beverly Hills Courthouse, were brought against Hubbard for alleged crimes that occurred between Sept. 25, 2005, and February 2006, while he was superintendent of the Beverly Hills Unified School District, said Deputy District Atty. Juliet Schmidt of the Public Integrity Division.
Also listed in the criminal complaint was Karen Anne Christiansen, a director of planning and facilities with Beverly Hills Unified at the time. Christiansen, 52, now living in Las Vegas, is expected to be extradited to California, Schmidt said.
Hubbard vehemently denied the allegations.
"It's absolutely not true," Hubbard said, becoming emotional during an interview at the door to his apartment near Fashion Island on Thursday night. "It's an injustice. This is my career. It's just not right. I don't know how I could have anything to do with it."
Bail for Hubbard, 53, who started as Newport-Mesa Unified's superintendent in July 2006, was set at $50,000.
Christiansen's bail has been set at $2 million. She faces two counts of misappropriation of funds and six conflict-of-interest counts, Schmidt said.
According to the complaint, Christiansen received an unauthorized stipend of $20,000 from Hubbard — something that later was allegedly discovered by the Beverly Hills district's assistant of business services superintendent, Alex Cherniss.
In addition to the stipend, Hubbard allegedly gave Christiansen increases in her car allowance that were unauthorized by the Beverly Hills school board, according to the criminal complaint.
Christiansen was hired as a facilities director for the Beverly Hills district in 2004 at an annual salary of $113,000. But in 2006, she allegedly negotiated a secret contract to be an independent contractor while also performing her school district duties — a violation of state conflict-of-interest codes, Schmidt said.
As a result, she was paid $5.2 million by the school district from 2006-09, a contract that Hubbard said was approved by the school board after he left.
Hubbard told the Daily Pilot that he had known Christiansen for three years but that they did not have any other relationship outside work.
Christiansen also allegedly negotiated contracts with an energy firm, Johnson Controls, to do work for the district while simultaneously negotiating contracts with her own company and Johnson Controls, according to Schmidt.
Outgoing Costa Mesa Councilwoman Katrina Foley, who was just elected to the school board on a platform calling for transparency in Newport-Mesa, said that the school board will have to wait and see how the criminal complaint pans out.
"It's shocking, but of course in America everybody is innocent until proven guilty," she said. "So we're going to have to see what's going on. But it's unfortunate, at the very least."
News of the charges filed against Hubbard came as a surprise to Michael Collier, an outgoing school board member.
"He had said something about being subpoenaed a few months ago, and that he had to go down to Beverly Hills or Los Angeles," Collier said. "But I don't know much other than that. I don't think he's that kind of guy."
School board President Karen Yelsey said,
"Since the matter was alleged to have occurred in another district, I'm going to reserve making any further statement or any judgment."
Brian David Goldberg, president of the Beverly Hills school board, released a statement:
"The Beverly Hills Unified School District and its board are gratified by the decision of L.A. County Dist. Atty. Steve Cooley and his office's Public Integrity Section, to file felony criminal charges against former BHUSD employee Karen Christiansen and former Supt. Jeffrey Hubbard.
"The district terminated Ms. Christensen last year for flagrant conflicts. The Board was also deeply dismayed by the conduct of Dr. Hubbard, who's been accused of providing benefits and entering into a consulting contract with Christiansen without disclosing these matters to the Board or obtaining Board approval."
Daily Pilot staff writer Michael Reicher also contributed to this report.