STATE OF CALIFORNIA - COUNTY OF VENTURA SEARCH WARRANT AFFIDAVIT (DISTRICT ATTORNEY REVIEW) The attached warrant and affidavit have been reviewed for legal sufficiency by the undersigned Deputy District Attorney. The contents, if sworn to by the affiant, are legally sufficient to justify presenting the affidavit and warrant to a cou~ for review. This document, consists of~pages, including the search warrant, declaration or probable cause, and this review fo~ ~ 1 ~cX-~-~ ~ Deputy District Attorney (Printed Name) eputy District Attorney (Signature) Date Search Warrant Affidavit DA Review YOU ARE THEREFORE COMMANDED TO SEARCH: 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 'I For the time period from January 1, 2005 to the date this search warrant is signed. The search is to include all offices, rooms, safes, locked boxes, files, desks, filing cabinets, storage facilities, private offices and other parts therein, storage areas, trash containers of any kind located thereon or about the premises in which the property sought. by this waffant may be reasonably be found. The search is also to include computer networking servers located on the second floor in the l~nformation Technology Division. Location #1: Oxnard City Hall 300 West 3rd Street Oxnard, California ' The location known as Oxnard City Hall is located at 300 West 3'~ Street, Oxnard, California. Oxnard City Hall is located in the County of Ventura and is described as a multi-story structure. The dark colored numbers and words "300 City. of Oxnard" are affixed to the buildings exterior near the building's main entrance. ii .11 ./I II /1 27. I' 28 ll 2 SEARCH WARRANT AND AFFIDAVIT 1 2 YOU ARE THEREFORE COMMANDED TO SEARCH: ' 3. Location #2: 4 5 6 7 8 .9 10 11 City of Oxnard Civic Center 305 West 3rd Street Oxnard, California /1 The location known as City of Oxnard Civic Center is located at 305 West 3'~' Street, Oxnard California. The City of Oxnard Civic Center is located in the County of Ventura and is described as a multi-story structure. The dark colored numbers "305" are affixed to the buildings exterior above the building's main entrance. ... 12~ II 13 li The search is to include all offices, rooms, safes, locked boxes, files, desks, filing 15 16 17 18 19 20 21 22 23 24 25 26 27 28 cabinets, storage facilities, private offices and other parts therein, storage areas, trash containers of any kind located thereon or about the. premises in which the property sought by this wanant may be reasonably be found. II . For the time period from January 1, 2005 to the date this search warrant is signed. II SEARCH w~~NT AND AFFIDAVIT 1 2 3 4 5 6 .7 8 V.9 FOR THE FOLLOWING PROPERTY: V V The term "correspondence" and "documents" as used below for the purpose of this search warrant will have the same meaning as "writings" including email communication as that term is defined in California Evidence Code ~ 250:. 1. Any and all correspondence, memorandum, notes and/or documentation by and between any employee, representative or other~ city personnel with V Kennedy Jenks Company during 2005-the present; . V 2. Any and all correspondence, memorandum, notes and/or documentation by Kennedy Jenks Company with any employee, representative or other city personnel during 2005 through the present, including, but not limit?d to any documents provided by Kennedy Jenks Company, 10 .12 13 ...~ 3 Any and all correspondence, memorandum, notes and/or documentation by and between any employee, representative or other city personnel with Emma Corporation during 2005-the present; :. ... . . . V :14 15 ~4. Any and: all correspondence,, memorandum, notes and/or documentation, by Emma Corporation with any employee, representative or other city personnel o o .17 18 19 20. 21 5 during 2005 through the present, including but not limited to any documents~ provided by Emma Corporation; . V V .V V Any and all contEacts., correspondence, memorandum, notes and/or documentation by and between any employee, representative and/or other city personnel with De La Rosa Company during 2005-the present; o 22 23 24~ 25 26 V 6. Any and all cOntracts, correspondence, memorandum, notes and/or documentatioti by De La.Rosa Company with an.y employee representative or other city personnel during 2005 through the present, including but not . V limited to any documents provided by De La Rosa Company; V 7. Any and all correspondence, memorandum, notes and/or documentation by and between any employee, representative or other city personnel with JVW Communications during 2005-the present; 4 V 27 28V V 'I SEARCH WARRANT AND AFFIDAVIT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 8. Any and all correspondence, memorandum, notes and/or documentation by JVW Communications with any emuployee, representative or other city personnel during 2005 through the present, including, but not limited to, any documents provided by JVW Communications; 9. Any and all correspondence, memorandum, notes and/or documentation by and between any employee, representative or other city personnel with MSW 4 ~Engineeririg Frrm during 2005-the present; '.-'~ 10. Any and all correspondence, memorandum, notes and/or documentation by MSW Engineering Firm with any, employee, representative or other city personnel during 2005 thr?ugh the present, including, but not limited to, any documents provided by MSW Engineering Firm; 11. Any and all correspondence, memorandum, notes and/or documentation by and between any employee, representative or other city personnel with Black & Veatch during 2005-the present; 12. Any and all correspondence, memorandum, notes and/or documentation by Black & Veatch with any employee, representative or other city personnel during 2005 through the present, including, but not limited to, any documents provided by Black & Veatch; 13. Any and all correspondence, memorandum, notes and/or' documentation by and between any employee, representative or other city personnel with Mainstreet Architects & Planners during 2005-the present; 14. Any and all correspondence, memorandum, notes 'and/or dQcumentation by Mainstreet Architects & Planners with any employee, representative or other city personnel during 2005 through the present, including, but not limited to, any documents provided by Mainstreet Architects & Planners; 15. Any and all correspondence, memorandum, notes and/or documentation by and between any employee, representative or other city personnel with Prousys during 2005-the present; 5 SEARCH WARRANT AND AFFIDAVIT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 16. Any and all correspondence, memorandum, notes and/or documentation by Prousys with any employee, representative or other city personnel during 2005 thrQugh the present, including, but not limited to, any documents provided by Prousys; 17. Any and all correspondence, memorandum, notes and/or documentation by and between any employee, representative or other city personnel with Consolidated Electrical Distributors during 2005-the present; 18. Any and all correspondence, memorandum, notes and/or documentation by Consolidated Electrical Distributors with any employee, representative or other city personnel during 2005 through the present, including, but not limited to, any documents provided by Consolidated Electrical Distributors; 19. Any and all correspondence, memorandum, notes and/or documentation by and between any employee, representative or other city personnel with Rockwell Automation during 2005-the present; 20. Any and all correspondence, memorandum, notes and/or documentation by Rockwell Automation with any employee, representative or other city personnel during 2005 tbroughthe present, including, but not limited to, any documents provided by Rockwell Automation; 21. Any and all correspondence, memorandum, notes and/or documentation by and between any employee, representative or other city personnel with Rawliags Mechanical during 2005-the present; 22. Any and all correspondence, memorandum, notes and/or documentation by Rawlings Mechanicalo with any employee, representative or other city personnel during 2005 through the present, including, but not limited to, any documents provided by Rawlings Mechanical; 23. Any and all correspondence, memorandum, notes and/or documentation by and between any employee, representative or other city personnel with Z Pipeline during 2005-the present; SE~CH wAR~N: ~b AFFIDAVIT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28. 24. Any and all correspondence, memorandum, notes and/or documentation by Z-Pipeline during with any employee, representative or other city personnel during 2005 through the present, including, but not limited to, any documents provided by Z-Pipeline during; 25. Any and all correspondence, memorandum, notes and/or documentation by and between any employee, representative or other city personnel with AEWT/Biwater du~ing 2005-the present; 26. Any and all correspondence, memorandum, notes and/or documentation by AEWT/Biwater with any employee, representative or other city personnel during 2005 through the present, including, but not limited to, any documents provided by AEWT/Biwater; 27. Any and all correspondence, memorandum, notes and/or documentation by and between any employee, representative or other city personnel with Herzog Wine Cellars during 2005-the present; 28. Any and all correspondence, memorandum, notes and/or documentation by. Herzog Wine Cellars with any employee, representative or other city personnel during 2005 through the present, including, but not limited to, any documents provided by Herzog Wine Cellars; 29. Any and all commemorative wine glasses supplied by Herzog Wine Cellars from 2005-the present; 30. Any and all correspondence, memorandum, notes and/or documentation by and between any employee, representative or other city personnel with Bernardo's Flowers during 2005-the present; 31. Any and all correspondence, memorandum, notes and/or documentation by Bernardo's Flowers with any employee, representative or other city personnel during 2005 through the present, including, but not limited to, any documents provided by Bernardo's Flowers; . - S~CH w~~NT AND AFFIDAVIT 1 2 3 4 5 6 7 8. 9 10 11 12 13 14 15 16 17 18 19 o2 0 21 .22 23 24 25 26 27 28 . . - 32. Any and all correspondence, memorandum, notes and/or documentation by and between any employee, representative or other city personnel with Fleur De Lis Flower and Gifts during 2005-the present; 33. Any and all correspondence, memorandum, notes and/or documentation by Fleur De Lis Flower and Gifts with any employee, representative or other city personnel during 2005 through the present, including, but not limited to, any documents provided by Fleur De Lis Flower and Gifts; 34. Any and all correspondence, memorandum; notes and/or documentation by and between any vendor and/or contractor doing, business with the City of Oxnard during 2005-the present; 35. Any and all correspondence, memorandum, notes and/or documentation by and between any City of Oxnard officer, elected officer, candidate for elective city office, and/or employee required to file a Form 700 Statement of Economic Interest regarding gifts received from or provided to any donor of any gift as defined in Government Code section 82028 including but not limited to tickets, passes, travel, lodging, meals, refreshments, and/or other tangible or intangible things during 2005-the present;. 36. Copies of all change orders and associated original contracts from the Oxnard Public Works Department from 2005-the present; 37. Any and all documents related to travel expenses and expense reports for Public Works employees from 2005-the present; 38. Any and all agendas and minutes of city council meetings, including, but not limited to, budget hearings, from 2005-thepresent; 39. Any and all policy and procedure 'manuals, fiscal manuals, bylaws, and reimbursement schedules in effect from 2005-the present; , 40. All credit card receipts and statements, monthly statements, and/or financial ' statements, bank statements, check books, including but not limited to any backup documentation, reports or justification for such expenses and expense SE~CH wAR~NT AND AFFIDAVIT 1 2 3 4 5 6. 7 8 9 10 11 12 13 14 15 16 17. 18 19 20 21 22 23 24 25 26 27 28 reports for all former and current city council members, City Manager Edmund Sotelo, Assistant City Manager Karen Burnham, Finance Dir?ctor James Cameron, City Attorney Alan Holmberg, former City Council member Tim Flynn, former Public Works Director Ken Ortega and former Public Works Project Manager Juan Moreno 2005-the present; 4l.Any and all training materials related to business expenses and/or documentation of business expenses, including but not limited to expense reports and per diem rates, in effect from 2005-the present; 42. Any and all documents related t? travel expenses for current and former city council members from 2005-the present; 43. Any and all reports pursuant to Government Code section 53232.3 regarding city council expenses from 2005-the present; 44. Any and all documents related to reimbursements for expenses and expense report forms including receipts incurred in the performance of official duties by any past or current member of city council from 2005-the present; 45. Any and all documents related to travel expenses and expense report forms and receipts for City Manager Ed Sotelo from 2005-the present; 46. Any and all documents related to transportation and lodging for all former and current city council members, City Manager Edmund Sotelo, Assistant City Manager Karen Bumham, Finance Director James~ Cameron, City Attorney Alan Holmberg, former City Council member Tim Flynn, former Public Works Director Ken Ortega and former Public Works Project . Manager Juan Moreno 2005-the present; . 47. Any and all documents related to travel expenses and expense report forms including receipts for City of Oxnard Finance Director James Cameron from 2005-the present; 48. Ethics and/or conflict of interest training materials including but not limited to related correspondence, memorandum, and/or attendance records for such SEARCH wARRANT AND AFFIDAyIT 1 o 2 3 4 5 o 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 . . training for all former and current city council members, City Manager Edmund Sotelo, Assistant City Manager Karen Burnham, Finance Director James Cameron, City Attorney Alan Holmberg, former City Council member Tim Flynn, former Public Works Director Ken Ortega and former Public Works Project Manager Juan Moreno 2005-the present; 49. Expenditure of public funds training materials and related. correspondence and memoranda for all former and current city council members, City Manager Edmund Sotelo, Assistant City Manager Karen Bumham, Finance Director James Cameron, City Attorney Alan Flolmberg, former City Council member Tim Flynn, former Public Works Director Ken Ortega and former Public Works. Project Manager Juan Moreno 2005-the present; 50. Original and copies of Form 700's from 2005-2010 for Mayor Tom Holden, Mayor Pro Tern Andres Herrera, Councilman Dean . Maulhardt, Councilmember Irene Pinkard, City Manager Edmund Sotelo, Assistant City Manager Karen Burnham, Finance Director James Cameron, City Attorney Alan Holmberg, Former Councilman Tim Flynn, former Public Works Director Ken Ortega and former Public Works Project Manager Juan Moreno; 51. Any and all records relating to the Desalter celebration and/or GREAT Program including, but not limited to, invitations., announcements, guest lists, correspondence, memorandum, receipts, warrants, order forms, expenditure logs and donation records; 52. Monthly check register and/or logs listing payments of City funds from 2005-the present; 53. Any and all travel records for City Council members, department managers and supervisors from 2005 through the present, including Mayor Tom Holden, Mayor Pro Tern Andres Herrera, Council Member Dean Maulhardt, City Manager Edmund Sotelo, Assistant City Manager Karen Burnham, o SEARCH WAR~NT AND AFFIDAVIT 1 2 3 4 5 6 7 8 9 10 1]. 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Finance Director James Cameron, City Attorney Alan Holmberg, former City Council member Tim Flynn, former Public Works Project Manager Juan Moreno and/or their spouses or relatives; 54. Any and all correspondence, memorandum or documentation related to time sheets and vacation requests for City Council members, department managers and supervisors from 2005 through the present, including Mayor Tom Holden, Mayor Pro Tern Andres Herrera, Council Member Dean Maulhardt, City Manager Edmund Sotelo, Assistant City Manager Karen Burnham, Finance Director James Cameron, City Attorney Alan Holmberg, former City Council member Tim Flynn, former Public Works Project Manager Juan Moreno; 55. Calendars and/or appointment books or ledgers for City Council members and department managers and supervisors from 2005 through the present, including Mayor Tom Holden, Mayor Pro Tern Andres Herrera, Council Member Dean Maulhardt, Council Membero Irene Pinkard, City Manager Edmund Sotelo, Assistant City Manager Karen Burnham, Finance Director James Cameron, former City Council Member Tim Flynn, Former Public Works Director Ken Ortega and former Public Works Project Manager Juan Moreno; 56. Any and all records relating to the personnel investigation of Juan Moreno and/or Ken Ortega conducted by private investigators, excluding any compelled statements; 57. Any and all records, reports, correspondence or memorandum related to any forensic accountings performed by Mr. Hall, or other outside auditors, related to the City of Oxnard from 2005-the present; 58. Any and all documentation regarding golf fees incurred by for City Council members and department managers and supervisors from 2005 through the present, including Mayor Tom Holden, Mayor Pro Tern Andres Herrera, SEARCH WARRANT AND AFFIDAVIT 1 2 3 4 5 6 7 8 9 10 11 12 13 Council Member Dean Maulhardt, Council Member Irene Pinkard, City Manager Edmund Sotelo, Assistant City Manager Karen Burnh?m, Finance Director James Cameron, former City Council Member Tim Flynn, Former Public' Works Director Ken Ortega and former Public Works Project Manager Juan Moreno; 59. Any and all city employee handbooks, policy and procedure manuals, and training manuals. 60. Any and all city Ordinances and/or Resolutions in effect from 2005-the present; 61. Any of the aforementioned evidence whether in documentary form or contained on electronic storage devices capable of storing electronic data, including, ~ computers, servers, laptops, celitilar phones, (including Blackberries, I-Phones, and Android based phones), Personal Data Assistants (PDA's), computer systems including central processing units; internal and peripheral storage devices such as fixed disks, external hard disks, floppy disk drives and diskettes, thumb drives, tape drives and tapes, optical storage devices or other memory storage devices; peripheral inputloutput devices such as keyboards, monitors, printers, mouses, joysticks, light pens optical readers, writing pads, devices such as modems, software to run programs, printers and manuals for the operation of the Computer(s); 62. All writings and documents which tend' to establish the identity of the person(s) in control of the computer and computer equipment. This is to include all computer data receipts, registration forms, canceled checks, warranty documents, purchase agreements, lease agreements, any computer logs, sign in sheets, notes, passwords or access codes; and 63. The affiant shall have the right to open, copy and examine, at a computer o forensics facility, any files from the seized or searched aforementioned computer drives or other media. 12 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 SEARCH WARRANT AND AFFIDAVIT I 2 3 4 5 6 7 AND TO SEIZE IT IF FOUND and bring it forthwith before me, or this cOurt, at the courthouse of this court. This ~~Warrant and incorporated Affidavit was sworn to and subscribed before me this /3"~iay of August 2010, at 1/3I Wherefore, I find probable cause for the issuance of this Search Warrant and do issue it. A II NIGHT SEARCH APPROVED: YES fl NO~ 8< ~~&TURE OF 9 o10 11 12 13. Judge of the Superior Court, Ventura Judicial District ORDER TO ALLOW CIVILIANS TO ASSIST IN SEARCH GoQd. cause showing, civilian personnel assigned to the Southern California High Tech Taskforce, who work under the direction of sworn peace officers, are allowed to assist in the search of the corn uter requested in this search warrant per 1530 PC. 14 15 16 17 18 19 20 21 22 23 24 25 26 27. 28 ~S~G1\1P~9URE OF MAGISTRATE) Judge of the Superior Court, Ventura Judicial District II ORDER TO ALLOW SEARCH OF COMPUTER OFFSITE Good cause showing, the search of the computer requested in this search warrant is allowed to take place at the Southern California High Tech Taskforce due to the specialized tools and programs required to effectively complete the search. A' ~ (~ ~IGNA~RE OF MAGISTRATE) Judge of the Superior Court, Ventura Judicial District . 13 . SEARCH WARRANT AND AFFIDAVIT 1 2 3 4 ORDER TO ALLOW FEDERAL AGENTS TO ASSIST IN SEARCH WARRANT Good cause showing, Federal Agents are allowed to assist in the search of the premises and computers requested in this search warrant per 1530 PC. 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 .24 25 26 27 28 NATU OF MAGISTRATE) Judge of the Superior Court, Ventura Judicial District . . SEARCH WAR~NT AND AFFIDAVIT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 DATED: Au~st/3, 2010 SEALING ORDER The Court has read and considered the search warrant affidavit submitted by Investigator Wayne Simmons of the Ventura County District Attorney's Office. The Court makes the following factual findings pursuant to California Rules of Court 243.1:o 1. There exists an overriding interest in protecting the record that overcomes the right of public access to the record; 2. The overriding -interest supports sealing the record; 3. A substantial probability exists that the overriding interest will be prejudiced if the record is not sealed; 4. The proposed sealing is narrowly tailored; 5. No less restrictive means exist to achieve the overriding interest. It is hereby ordered that the placement order and affidavit remain sealed by order of this court until such time as the Court directs otherwise. The said placement order and affidavit may not to be released without further order of this court. This order has been requested by Senior Investigator Wayne Simmons's affidavit pursuant to Evidence Code section 1040, as well as California Rules of Court section 243.1. __________________ Ju eof the Superior Court County of Ventura SEARCH WARRANT AND AFFIDAVIT 1 2 3 4 5 6 7 8 9 10 'I 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 STATEMENT OF PROBABLE CAUSE I,. Senior Investigator Wayne Simmons, am employed by the Ventura County District Attorney's Office, Bureau of Investigation. I have been an investigator with the Ventura County District Attorney's Office for over 7 1/2 years. I have a total of 35 years of law enforcement experience as a sworn police officer, having worked as a police officer, detective and sergeant with tl~e Santa Barbara Police Department for over 27 V2 years. During my law. enforcement career, I have worked as an investigator oor supervising investigator for over .19 years. I have previously worked in a variety of areas including major crimes, narcotics, sexual assault, fraud and computer crimes. Currently, I am assigned. as the supervisor of the Administrative Unit, and have been for the past eight months. In my present assignment, I am responsible for conducting criminal investigations involving fraud and corruption committed by public officials and other persons who hold positions of public trust. These investigations include, but are not limited to, the falsification of public records and documents, the theft of public funds, grand theft, major fraud, bribery, money laundering, criminal conspiracies, and other crimes involving the abuse of power and authority. I have learned how public official corruption and various types of fraud are perpetrated through my own investigations, byway of both formal and informal training, and from interviews with suspects, victims, and witnesses. Additionally, 1 have consulted. with other peace officers and investigators and deputy district attorneys who investigate and . prosecute these types of crimes. I have personally arrested and interviewed persons involved in various criminal activities including theft, fraud and associated crimes, and have become familiar with the manner in which various crimes are committed. /1 Based on my investigation in this matter, I believe probable cause exists to suspect 16 SEARCH WARRANT AND AFFIDAVIT 1 2 3 4 5 6 7 8 9 10o 11 certain City of Oxnard officials of receiving personal gifts from firms that have secured public works business contracts with the city, and failing to report these gifts in violation of Government Code Government Code ? 89503, California Penal Code ?~ 118 and 424 (a), and ? 1090 and that the evidence of these violations will be found at Oxnard City Hall, located at 300 West 3rd Street, Oxnard, California; and City of Oxnard Civic. Center, located at 305 West 31(~ Street, Oxnard, California. II II BACKGROUND l. Statement of Economic Interest Form 700 and Public Gifts 12~ A statement of Economic Interest (FORM 700) is a Fair Political Practices~Commission 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 17 SEARCH WARRANT AND AFFIDAVIT . S. form that specified individuals must file. Government Code (hereinafter "G.C.") The Political Reform Act governed by 81000-91014 requires most stat?4and local ?~ government officials and employees to publicly disclose their personal assets and income. The Fair Political Practices Commission (FPPC) is the state agency responsible for issuing the Statement of Economic Interests Form 700. Schedule "D" requires reports of gifts from non-family members (such as tickets to sporting or entertainment events). Schedule "E" requires reports of travel payments from third parties (not the subject's employer). The Form 700 is a public document. Form 700 must be ?Iled annually for Elected State Officers and State Board and Commission Members listed in G.C. ? 87200. Gifts received by most state and local officials, employees and candidates are subject to a limit. For 2009-20 10, the gift limit is $420 from a single source during a calendar year (the amount is adjusted every two years). Under G.C. ?87200,.public officers designated to file a Statement of Economic Interest must report any gift in an amount over $50 from a single source on their annual Form 700. 2 1 2 3 4 A gift over $50 must be reported, but there is no prohibition on official action by the public officer. Gifts over $420 are prohibited and the official cannot take official action or make official decisions affecting the donor (~ 87202, 87203, 87207). A knowing or willful failure to file a Form 700 as required, or a knowing or willful failure 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 o o 25 26 27 28 to include a gift over $50 on the form can be prosecuted as a misdemeanor violation of G.C. ?91000. The 700 Form must be verified. The instructions of the Form (Part 5) state: "Complete the verification by signing the statement and entering the date signed. When you sign your statement you are stating, under penalty of perjury, that it is true and correct. Only the filer has the authority to sign the statement. An unsigned statement is not considered filed and you may be subject to late filing penalties." The 700 Form verification states "I certify under penalty of perjury under the laws of the State of California that the foregoing is true and correct." Since, the Form 700 is filed under penalty of perjury, failure to include a gift over $50 on the Form also constitutes a felony violation of Penal Code section 118, perjury. A gift is defined in G.C. ?82028as: Any payment that confers a personal benefit on the recipient, to the extent that consideration of equal or greater value is not received and includes a rebate or discount in the price of anything of value unless the rebate or discount is made in the regular course of business to members of the public without regard to official status. Therefore, any financial benefit that the officer receives as a result of his official position that is not available to the general public is considered a gift. Travel is not reportable as a gift ~f provided by an outside source to the official for a speech or panel participation at an event limited to the day before, day of and day after the event. It must be reasonably related to a legislative or gOvernment purpose and includes travel, lodging, admission and refreshments. 18 SEARCH WARRAI'TT AI'~D AFFIDAVIT 1 2 3 1/ 2. Conflicts of Interest If the official decision affects a contract between the official's agency and the donor of the ~ 6 gift, there may be a felony violation of G.C. ?~1090 and 1097. G.C. ? 1090 applies only to contracts, sales and purchases in which a public official or employee has a financial interest. Section 1090 is not part of the Political Reform Act. Financial interest includes 8 ~. any financial interest that might interfere with a city officer's unqualified devotion to his public duty. The interest may be direct or indirect and includes any monetary or The interest broadly encompasses anything that would tie a public G.C. 10 proprietary benefits. official's fortunes to the existence of a public contract. 12 13 14 15 16 17 .18 19 20 21 22 23 24 25 26 27 28 ? 1090 precludes any involvement by a public official in the process that leads to a prohibited contract, including preliminary matters. Pursuant to G.C. done "knowingly and willfully." ? 1097, a violation of 1090 is criminal if / 3. Misappropnation of Public Funds Any person charged with the receipt, safekeeping, transfer or disbursement of public money, and any offlcer of a state, county, city, town or district who appropriates money to his own use or the use of another without legal authority, loans money, profits from money or makes use of money not authorized by law, who, knowingly keeps false accounts or makes a false entry, fraudulently alters, falsifies, conceals, destroys, willfully omits or refuses to pay over money when demanded by proper warrant or authority, or willfully omits to transfer money when required to do so is guilty of misappropriation of public funds in violation of Penal Code section 424, a felony. ' . 19 SEARCH WARRANT AND AFFIDAVIT I' . 1 2 3 4 5, 6 7 8 9 10 11 12 13 14 15 16 17 18 o 19 20 21 22 23 o 24 25 26 27 28 To "appropriate" means "to take exclusive possession of," "to set apart for or assign to a particular purpose or use" or "to take or make use without authority or right." (Webster's Collegiate Dict. (10th ed. 2000) p. 57, col. 2.) This section can be violated without actually using the public money; it is enough if the official simply takes the money or sets is aside without authority. The unauthorized use of public money is a violation of section 424(a)(2). The unauthorized appropriation of public money is a violation of section 424(a)(1) regardless of whether the money is ever actually used. An expenditure of public funds is regulated solely by constitutional and statutory provisions and must be confined to public purposes. Officials are not free to spend public funds for any 'public purpose' they may choose, but must utilize appropriated funds in accordance with the legislatively designated purpose. An expenditure of municipal funds is permitted only. .where it appears that the welfare of the community and its inhabitants . is involved and benefit results to the public Penal Code section 426 defines public moneys as follows: "The phrase 'public moneys' as used in Sections 424 and 425, includes all bonds and evidence of indebtedness, and all moneys belonging to the state, or any city, county, town, district, or public agency therein, and all moneys, bonds, and evidences of indebtedness received or held by state, county, district, city, town, or public agency officers in their official capacity." II .4. Contracts and Change Orders A change order is a process used by many businesses and governmental entities, particularly those that provide services to customers or public. Through a change order, the business and the client can make alterations to an original business agreement. The change order process is commonly used in t1~constrncfion business. SEARCH WARRANT AND AFFIDAVIT 1 When a construction business first places a bid on a project, it spells out the services and 2~ materials to be provided. The original contract also outlines the design for the project and 3 4 5 the projected final outcome. If problems arise during the construction process or the client changes his or her mind about what he or she wants to be done, a change order form must be completed. The change order form details the new plan, including services, materials, and designs that the client and the company have mutually agreed upon. The change order form then becomes the valid contract by which the client and the construction company must legally abide. 6 7 8 9 10 SYNOPSIS 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 21 SEARCH WA RANT AND AFFIDAVIT There is probable cause to suspect that former City of Oxnard Public Works Director Ken I Ortega, City of Oxnard Manager Ed Sotelo, Oxnard Mayor Pro Tern Andres Herrera, and City Financial Officer James Cameron , received personal gifts from firms who had secured public works and, other contracts with the City of Oxnard, and said city officials failed to report. or underreported these gifts on their Statement of Economic Interest Form 700 (hereinafter referred to as "Form 700"). Failure to report gifts over $50 from a single source on their Form 700 is a misdemeanor in violation of G.C. ?~ 87202, 87203, 87207; accepting gifts in excess of the limitations imposed by section 89503 is subject to prosecution for a misdemeanor pursuant to G.C. 91000. These forms are signed under penalty of perjury. By doing so willfully and knowingly, these officials committed perjury, a violation of California Penal Code ? 118, a felony. 'I have probable cause to believe that city officials accepted gifts in excess of $420 from a single source over a given calendar year, and voted on or signed contracts related to the donor of the gifts'in violation of G.C. ?~ 1090 and 1097, a felony. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 I also have probable cause to believe that city officials misappropriated public funds by moving and concealing public monies earmarked for one public works project to fund a lavish party for invited guests, costing more than $60,000 of public money, a violation of California Penal Code ? 424 (a), a felony; INVESTIGATION I. Public Works Director Ken Ortega On June 18, 2010, I interviewed former Public Works Director Ken Ortega at the Bureau of Investigation Headquarters. I informed Ortega that this was a non-custodial interview and that he was free to leave at any time. Ortega admitted that during his tenure as Public Works Director from 2005 to June 1, 2010, he received several gifts in the form of lunches, dinners, and golf outings that were not reported on his Statement of Economic. Interest Form 700, as required by law. Ortega said in October 2005, several members of the Oxnard City Council and City Manager Ed Sotelo, received reportable gifts by attending a League of Cities conference in San Francisco. The day before the event, several members of the city council and City Manager Sotelo met with John Kim, an emp1oye?~ of the De La Rosa Company, an investment banking firm. Kim hosted a golf outing at the Presidio Golf Course in San Francisco, along with food and drinks. Based on the description of the outing by Ortega, I believe that the value of the event exceeded $50 and as such required to be reported as gifts by all Form 700 employees. The attendees were City Manager Sotelo, Councilman Dean Maulhardt, Mayor Tom Holden, Councilman Andres Herrera, and Councilman Tim Flynn. Ortega. did not believe then Councilman Flynn golfed at the event. Public Works Director Ortega had to leave the event to return home and did n~t participate in the golf outing. Ortega was aware of the schedule of events. However, this event should have SEARCH WARRANT AND AFFIDAVIT 1 2 3 4. 5 6 7 8 .9 10 11 12 13 14 15 16 17 been reported on the Sotelo, Maulhardt, Holden and Herrera's individual Form 700s. I did an internet search of the Presidio Golf Course and their non-resident green fees range from $69 to $125. According to documents I reviewed that were filed with the City of Oxnard, neither City Manager Sotelo, Councilman Maulhardt, Mayor Holden, nor Councilman Herrera reported these gifts on their respective Form 700's, which are signed under penalty of perjury. I believe this conduct constitutes a violation of California Penal Code ? 118 (a), Perjury, a felony. Those records have not been received or reviewed for Tim Flynn, but should be on file in the City Clerk's Office. California Penal Code ? 118 states, in relevant part: . . Every person who. states as true any material matter which he or she knows .to be false, and every person who testifies, declares, deposes, or certifies under penalty of perjury in any of the cases in which the testimony, declarations, depositions, or certification is permitted by law of the State of California under penalty of perjury and willfully states as true any material matter which he or she knows to be false, is guilty of perjury. . Ortega also said in 2006, he accepted the gift of attending a Los Angeles Lalcers 18 basketball game hosted by. Jeff Savard, vice-president of Kennedy/Jenks, a local 19 engineering and consulting firm doing business with the City of Oxnard 20 Department. He said City Councilman Herrera and Public Works Project Manager Juan 21 Moreno also attended the event. They were driven to the game and back home by 22 limousine, treated to refreshments at the game, and dinner after the game, all of which was 23 paid by Jeff Savard of Kennedy/Jenks. Based on information I obtained from the CEO of 24 Kennedy/Jenks, I believe that the value of this gift exceeded $50 to each attendee. 25 26 Ortega admitted that he did not report these gifts on his Form 700 in 2007 as required. 27 Ortega said at the time of this event, Kennedy/Jenks had several business contracts in 28 23 - Public Works SEARCH WARRANT AND AFFIDAVIT 1 2 3 4 5 6 7 place with the City of Oxnard. Ortega said at the time, he was in a position to approve, and did approve, contracts with Kennedy/Jenks and other firms doing business with the City of Oxnard. Based on other information that I obtained from Ortega, I believe Ortega received in excess of $420 in several calendar years from Kennedy/Jenks, and still signed off on contracts with Kennedy/Jenks on behalf of the City of Oxnard. I believe that this conduct constitutes a potential felony violation of G.C. ?? 1090 and 1097. 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 2'S Ortega provided an example of how other city officials may have failed to report gifts on their Form 700s. In November' 2008, Ortega traveled to New York along with other Oxnard city officials to receive a "bond buyers" award. Ortega, and several other officials, took their spouses with them. Public Words Director Ortega believed that after the event Ed De La Rosa and employee John Kim of the De La Rosa Company paid for expensive dinners, including a dinner at a restaurant owned by Robert DeNiro, theater tickets, valued at $86 each, and extended hotel stays. Those participating in the extended stay were City Manager Sotelo, his wife and step-daughter; Councilman Andres Herrera and his wife; and City Finance Director James Cameron and his wife. This information from Ortega was later corroborated by dinner receipts provided to me by the City, showing John Kim of the De La Rosa Company paying for two expensive dinners. The aggregate amount of these two receipts was $2,500. I reviewed copies of filed Form 700s related to the above subjects and the New York event. My search revealed that City Manager Sotelo and Councilman Herrera failed to report these gifts. In fact, the only city official who reported receiving any gifts in connection with this New York event waso City Finance Director James Cameron. H?wever, his reporting was limited to receiving only one $45 theater ticket, and not the dinners, additional theater tickets and the extended stay at the hotel 24 SEARCH WARRANT AND AFFIDAVIT 1 2 3 4 5 6 7 8 9 10 11 12 , In addition, I reviewed a document provided by the city that showed the De La Rosa Group purchased fourteen (14) theater tickets for a play in New York at $86 each for the same time period. This information tends to further corroborate Ortega's statements. Upon reviewing the Form 700's for those officials who were treated to the dinners and theater tickets and extended hotel stays, all either failed to report the, gifts or underreported the value of their gifts. I believe this conduct constitutes a violation of California Penal Code ? 118 (a), Perjury, a felony. Ortega spoke of another instance when he and other officials failed to report gifts. He said in December 2,009, he went to a bond rating meeting at the Standard and Poor's Office in San Francisco. He along with City Manager Ed Sotelo, Finance Director James Cameron and Finance Manager Mike. More were treated to an expensive dinner the night before the presentation by John Kim of the De La Rosa Company. Ortega estimated his dinner amounted to $100 or more. Form 700s showing receipt of gifts in connection with this 13 14 15 16 17 18 19 20 21 22 23 '24 25 26 27 28 event was required to be completed and filled with the City of Oxnard by April 1, 2010. .My search revealed that Ortega, City Manager Sotelo, and Finance Director James Cameron failed to report said gifts on their Form 700s. I believe this conduct constitutes a violation of California Penal Code ? 118 (a), Perjury, a felony. The Form 700 for Mike More has yet to be obtained and reviewed. On one occasion within the past few months, Ortega said he received a call from City Attorney Alan Holmberg who asked him for details about a hosted golf outing provided by a vendor so he 'could complete his Form 700 for gifts received in 2009. Ortega spoke of yet another instance when he failed to rcport a gift as required by law. He said he received gifts from a Santa Barbara attorney, Ron Saperstein of the law firm of Brownstein, Hyatt, Farber and' Schreck. ~These gifts were in the form of' tickets to a sporting event. This firm did business with the Public Works Department and the City 25 SEARCH WARRANT AND AFFIDAVIT 1 2 3 4 5 6 .7 8 .9 10 11 12 13 14 15 16 17 18 19 20 21 Attorney. According to documents filed with the City of Oxnard, this gift was not reported on Ortega's From 700. Ibelieve this conduct constitutes, a violation of California Penal Code ? 1 18 (a), Perjury, a felony Ortega said during the time he was employed by the City of Oxnard - Public Works Department, dinners, lunches and golf outings hosted by firms doing business with the city were common, as often as several times per week. Ortega said he was initially unsure as to the reporting requirements, but later learned what the reporting requirements were and that he had to report any gift above $50. Ortega admitted that he should have reported. these gifts as required, but felt as though he was being singled out by the media and city officials for things that City Manager Sotelo; city councilmen Herrera and Mayor Holden were doing as well. Ortega believed that failing to report gifts while in office was common practice between vendors and city officials and to single him out was hypocritical. For this reason, Ortega was cooperative and submitted to an interview. I interviewed Ortega again on August 11, 2010. Ortega said at the Bond Buyer's awards trip in 2008 he and his wife dined at the two restaurants and attended the play "Gypsy" that was entirely hosted by John Kim of the De La Rosa Company. He again identified Andres Herrera, Edmund Sotelo, James Cameron, Mike 'More and their family members' 22' in attendance. He did say that Herrera and his wife did not attend the play became she 23 24 25 26 27 28 He urther discussed the League of Cities conference in San Francisco and stated that the City of Oxnard group stayed at the Hilton. Even though he had to leave, he said that Sotelo told him later about going to dinner at one of the hottest restaurants in town, Aqua, and said that Sotelo also told him about 'another fancy restaurant for dinner that, 26 became ill after eating at one of the restaurants the day before. SEARCH WARRANT AND AFFIDAVIT 1 2 3 4 5 .6 7 8 9 10 11 12 13 14 15 16 17 18 19 20. 2.1 22 23 24 25 26 27 28 attended on a different night of the trip. Ortega said that he believed these events were sponsored by John Kim of De La Rosa. He said that he also believed the golf excursion at the Presidio was hosted by John Kim. Ortega told me that Ed Sotelo had a saying to .the effect -- "I don't want any record. Bring cash." He said that Sotelo made it clear that be preferred not to have receipts that might be looked at later, and often instructed Ortega to get cash in advance so that the lower level city employees did not pay or have the need for a record of these events. // II. Oxnard City Manager Edmund Sotelo On July 22, 2010, I interviewed Oxnard City Manager Edmund Sotelo. He was accompanied by Patricia Kinaga, a private attorney allegedly contracting with the City Attorney hired by the City of Oxnard, Kinaga said she was present during the interview to defend the City of Oxnard in a pending personnel action to which City Manager Sotelo was not a subject. Sotelo agreed to give a statement. Sotelo said Project Manager Juan Moreno had been terminated by the city for inappropriate billing practices, primarily with the Emma Corporation, an engineering firm that did business with the City of Oxn?rd-Public Works Department. He said Projec~.t Manager Moreno was appealing his termination and was the subject of litigation. He basically provided details that led to Moreno's termination. When employed by the City of Oxnard, Moreno's immediate supervisor was Public Works Director Ken Ortega. Sotelo said Public Works Director Ortega had questionable dealings with vendors doing business with the City of Oxnard, including JVW Company, a public relations firm; MSW 27 SEARCH WARRANT AND AFFIDAVIT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26' 27 28 Engineering; and the Kennedy/Jenks Group, an engineering and consulting firm. Sotelo advised Public Works Director Ortega to stop any business dealings with JVW Company because the city business contracts with them were too ?ostly for the work provided. Sotelo learned that Ortega continued doing business with them, "hiding" business contracts within other business contracts with other firms. Sotelo said Ortegao allowed MSW Engineering to occupy a building in the city corporate yard to perform work on city projects, which appeared to be inappropriate. Sotelo thought the relationship Ortega had developed, with MSW was inappropriate. They also determined some inappropriate relationships that Ortega had with Kennedy/Jenks and their office manager Jeff Savard involving gifts. Sotelo said the City of Oxnard ,hired a private investigator, Chuck Hookstra, a former Assistant Chief of Police, and another private investigation firm, Public Interest Investigations, Inc., to investigate the activities of Public Works Project Manager Juan 'Moreno. Apparently those individuals reported back their findings to Sotelo and the City Attorney. I questioned Sotelo about his conduct in relation to his receiving gifts and reporting those gifts as required by law. Sotelo said he reported all gifts he received. He claimed the only gift he received, which he said was reported on his Form 700, was a Dallas Cowboy football jacket given to him by the football organization several years ago when the team held their training camp in Oxnard. Sotelo said he attended the event at the Presidio Golf Course before the League of Cities conference, but elected not to elaborate on any details, such as who paid for,the event, at the direction and counsel of Ms. Kinaga. He also admitted to attending the Bond Buyer's event in New York, but again declined to provide any details of the event at the direction 28 'SEARCH WARRANT AND AFFIDAVIT 1 2 3 4 5 6 7 8 9 10 11 o o 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 and counsel of Ms. Kinaga. I asked him about the dinner where John Kim was present in San Francisco in 2009. Sotelo admitted that he had dinner with John Kim and others, and stated that after dinner he went to the restroom. When he returned to the table, to his surprise, the dinner and beverage bill had been paid. He did not know who paid for the dinner. Based on the review of Sotelo's Form 700, he did not report these gifts, a violation of California Penal Code ? 118, perjury. During the interview with Sotelo, he brought a document with him that I had previously requested involving a business contract between Ortega and Kennedy/Jenks Group. Sotelo and Ms. Kinaga were reluctant to provide said document claiming it might contain a personnel matter, despite my claim that the document was relevant in the ongoing criminal investigation. These do~uments contained, information relating to a change order to an existing City of Oxnard business contract, a letter from Jeff Savard and e-mail communications between Jeff Savard and former Pubic Works Director Ortega. I subsequently determined that these documents were the same documents Assistant City Manager Karen Burnham and City Manager Sotelo told Oxnard Chief of Police John Crombach that they would provide to law enforcement. The documents were only turned over after Ms. Kinaga received a request on District Attorney Letterhead for all conespondeiice with Kennedy Jenks and 'any outside consultants related to the expenditure of contract funds during 2009-2010. II ilL Police Chief John Crombach 27' On July 22, 2010, Deputy Chief Investigator Glen Kitzmann interviewed Oxnard Police o 28 Chief John Crombach. Deputy Chief Kitzmann relayed the following information to me o 29 >z SEARCH WARRANT AND AFFIDAVIT 1 2 3 4 5 6 o 7 8 9 10 11 '12 13 14 15 16 17 18 19 o 20 21 22 23 24 25. 26 27 28 about the interview. Chief Crombach said he learned that former Public Works Director Ortega had resigned approximate one month earlier and shortly after a Ventura Star article was released alleging that Ortega had received unreported gifts. According to Chief Crombach, City of Oxnard officials and city management staff attended ethics training that discussed the reporting requirements for those who receive gifts. Chief. Crombach believed the Human Resources Department would retain those training records. Chief Crombach had a previous meeting with Assistant City Administrator Karen Burnham and Sotelo in June or July of this year. During the meeting, Burnham'told him that there may have been some inappropriate business dealings between former Director of Pubic Works Ken Ortega and the Kennedy/Jenks Group. These inappropriate business dealings involve adjusted invoices, overbilling and money designated for certain projects diverted to other things. One such diversion of public funds involved money diverted from one project to fund a gala to celebrate the opening of the desalinization plant. Sotelo then joined the conversation and confirmed the suspected inappropriate conduct of Ortega. Chief Crombach told both Sotelo and Burnham that this case should be referred to the District Attorney's Office. Bumham said the Kennedy/Jenks Group would forward those documents to her and Sotelo. After a few weeks, Chief Crombach inquired as to whether Burnham had received the documents and she said she had. Even though Burnham said she would either provide Chief Crombach or the District Attorney's Office with the documents, there was an unreasonable delay in providing them to law enforcement. The documents in question were apparently the same documents Sotelo reluctantly turned over during his interview on July 22, 2010. . II 30 SEARCH WARRANT AND AFFIDAVIT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 - IV. Additional Documentation Provided By City On July 26, 2010, Glen Kitzmann, Deputy Chief Investigator of Special Operations, provided another DA letter request for additional documentation from Mr. Sotelo, Ms. Kinaga and City Attorney Alan Holmberg. The request sought correspondence with a number of specific contractors from 2005-2010, as well as change orders, travel expenses for public works employees and city council minutes. To date, very little documentation S has been provided, but Sotelo claims that more documents will be forthcoming on August. 13, 2010. S On July 30, 2010, additional documents pursuant to the original request to Sotelo were provided. These documents included a letter to De La Rosa that said in part: I am writing to follow up on our request for documents that De La Rosa may have regarding the following gifts Kim said he gave to various Oxnard employees: S - Dodger game tickets for James Cameron and Ken Ortega, possibly sometime in 2009; Dodger game ticket for Mike Muro, possibly sometime in 2009; - Dinner on the night of the "Bond Buyer Awards" in New York for Ed Sotelo and his wife, Andres Herrera and his wife, Mike Muro and his wife, Ken Ortega and his wife, and James Cameron; S Theater tickets to a Broadway show in New York in 2008 for Ed Sotelo and his wife, Ken Ortega and his wife, and possibly James Cameron; - 25 26 27 28 Dinner on the same night as the Broadway show for Ed Sotelo and his wife, Ken Ortega and his wife, and possibly James Cameron. S To. the extent that it is possible, we would like documents that confirm the following information for each gift: to whom the gift was given; the date the gift was given; -the value of the gift. S - I, SEARCH WARRANT AND AFFIDAVIT 1 2 3 4 In addition, while we are grateful for Kim's participation in yesterday's interview, in the event that Kim failed to recall all the specifics accurately, we would also ask that you provide any documents that reflect any other gifts provided to Oxnard employees that Kim failed to recall yesterday In addition to the foregoing, the City provided some documentation from De La 5 Rosa that included the 12/3/08 dinner at Tribeca Grill (a true and correct copy below): 6 7 8 9 10 11 12 13 14 ~ DATE 12J33/03 &~~& ~&~' ~(S~ ?/~-gfc~/ : -- oA9fl*i~R DI~L'iE~* 4500 ioo.~ 32 23 1 IIC,u 2 Ytny~ . I 14 tAxJdir~ reoos 3PREI~40AI~1 OAILYSW' I~lE~$AL40 E1EIM t)*FW~ 2 STRIP I IIIICXVEN 2 FILET ~. I REASE WE ~ TINE I1:3~'fl 25.00 90.00 314~ 78.00 rP.mEcA GRILL 3 BSJr sIGN AIEI WE NTRaW~r c~ ~ CCPY Is mi~s io TALE 1DAJETRIE 15 16 17 18 19 20 21 22 V V 2 S-)i5p FOrATO I GNU)P ~ I S - AUU1A~ VE~ ICEILES' 700 532 3:00 12.00 I I I 11~r~ ~ 2 LITBE ESILEE. 2ICEDA9)~ V J I MASTER TEL 27 AWN 076c62 )00~V00~~7454 OABX 3 158385 PRE-AUTR AJ)IM~TR ai~ ~ / I TAX SUBTOTAL * 343.25 13.32 1022.25 . 10.00 I_~4'_ -- TEMWL4TMIT Ii SCZU' IAPPLEIPEM 2XETaI 9.32 150.00 20.00 11.00 9.00 300 7,32 TOTAL SIGNAU*WX, . 18&E?~K~190 I)9Cay~w~32 IICETa!LP 1(19 CA9t~XDER WILL PAY GAT~ IS$U83 AEQYE 1 1 SUBTOTAL ~ TAX 4. 943 .25 79 00 R022.2~ MERCHANT Copy TOTAL DUE TRIEEC4GNIL 375 (RE91,y~c~ STREET rnrEREsTED TI A RTIVATE PARTY? CALL (212) 941-2905 (2T2)94!.~ V V V 23 V V 24 25 26 27 28 V That bill shows a dinner bill for $1,180.25 and is signed by John Kim on his credit card. The items ordered include what appears to be three bottles of wine, appetizers, entrees and dessert. V V V V V V V V 32 SEARCH WAR~T AND AFFIDAVIT 1 2 3 The documentation also included a receipt for Theatre Direct International (a true and correct copy below): 4 5 6 7 8 9 10 Printed: 12/01/2008 ~ By; era ~ Clientl: Day: Eve: Fax: ~nail: 119087 415--495--8863 ayaoin~kaya9ejdelarooa .com ZVZ 00:00 YI.4 246 Neat 44th Street D200Y -- Customer Invoice Order#: 510088 TO: ~urna Yaainakaya P,nna Ynainakeys 101 Montgomery St. San Francisco, CA 94104 Gypsy St. James Theatre Thureday, DeOedder O4~ 2000 -- New york, NY 10036 5050]. ,sj.o. 5.0. 5.. 55ev ck05 55L4 5.1.550. 14. 14 ORCHESTRA ?C 0388003 Ticketa 86.25 2.00 123~.50 .00 1235.50 11 12 13 14 1235.50 1235.50 PLEASE R~4IT BALNICS OF ~ 1235.50 SY 12/01/06 OR SEATS MRY BE RELEASED. For questions regarding thin order, pleace call clayton at 212--307--2194. Pleas. retucn a copy of thts INVOICE with your check cc money otder payabl. to; T~TP~ DImZco I~~XX~O.L 72970], A~c. - 4th floom W.V Thak, S~ 100~P Pleaaa ~o not send uitipie check. or cash. PLEMt WRITE THE ORDER NUNBER ON YOUR CHECIC If pyfag b.4~ oa.dit card, pl.asm KfU cot tb. jafocartiom bs3.o,~ sad La.. to 232-53.1-P].OI, COO: C$P. ~ P3....... tot ce keom ~o yco o.at to racair. Io~ tiok.t.; Wail ticket. Bhipped Via Ledtx 15 16 payment uni.sa already Bold Tioket~ at EoN Office to be ~ick.d up day of show.? ~ 'Mi Off--Broadway ahowa esuet select X_______________________________ Date: this option. u.,thorizcd signature oM.1 non--U.S. addresses oust select 2' a~tborise ~aatre Dir.ot/flhoVt~X sad/er .tf,.. theatre to tIis ~ thaa9. tEa above aao.sotl. Note; Xoternetiooal clients, plosse consult with our office. N~. cc cord, 17 18 19 20 21 22 23 24 25 729 7th Ayenoe -- JZ.ZRKE WOES; THIS 6th floor NY, NY 10019 IS A VD~L 521.51 ~Oc ReLoad. or o Phone: 000--276--2392 . Fax.: 212--011--9109 The receipt shows the purchase of 14 orchestra seats to the St. James Theatre in New York on 12/4/08 at a cost of $86 per ticket. // II The documentation further showed the dinner expense for the dinner at the Gotham Bar and Grill on 12/4/08 paid for by De La Rosa (a true and correct copy below): 26 27 28 33 SEARCH WARRANT AND AFFIDAVIT 1 22124,3242 22:43 Ifl..,,V... 2 3 4 Q~c~cL)2Wb Cf~._ I~r:A. -- ?ft~C.. L1fl~ ..m.oT ofl9 2WI \1(s--~~c2~1' ~2c2..a~ ~ k4~w fl4~~nw~26 ~ OIIWCCU* -- i~I~.d -~ 7.24.11 I asdcl W241 U2UPI4o~ ~ ~s.2C~?: 141P)2 7~P.2 D.4.~ I~422oD2 I I 1224W l.~.*.2 j ~4222q. 5 6 7 8 9 10 11 12 13 14 15 -- o. -. - _.__._mL... o.. .. .- .-- -----. -- L~L ---- --. .. o . - -.-- --,~-. -- -..- .01.44 o .,1~ .011.4 - ~ ~ ~i~J~q~: o .. - 12 o~ offi2~I _~~! _._3~___. ~-- 4, -- .~W_ . - -. I10~pI 102413 o G.i'Qw..' .0; II ~ o_ -~ o ... 2 -.--~--- -- --.-----~--~-----.. -- -- .-- o-- . - .1~24o ---- -- -- - -- ..10~L_ 21 .~. -- .__ .. -. -. - ~-- ... -- - Z1[Z 1024.0 o -- - .~r_ 0~._ I~11I4 Z~JJZJ __.J;L. ~1 oDoO2C.14I _._2~L. 221071 14112. .... -- --.- ~ o~t~__ ~ --. --. .~.~--o--- o -- 'm~L .-o ..l0 -- .___._._. ------.. 11.411 . C.d; ~. o - '~q. ~ o o 0*02: ~ po~ ... ~ -. --~--.oo. . . ::~ ~ _r__ 4 ~ -~ 4020. .2~ 0i~ o.. o ~ .o -. 2 ..o --. 0202' _"~J o _~4_ 1.020 _.~. -- - o_ o-. - -- -- o._..:._ -- ---- ._. -. o.. - -. . ,~. o ~ .?L_..lt._ --. --t --. - ... .Tmr. -o ------~---- __p~I 2~2 2 210204 2201.4 -- ---- ~2V 2*YI 14 4: 20 40204 22.241 - -- - -- o~- - _J~ -- ----- -- _o_..____4~._...._._ 0202 2: 10.00- 0240 . _.. --. ._ ... . ... ... ~44.21 . 24 - of I o1 40404 ---- 4002. 40024 .J114~_..._ _J~L~ io. 16 17 18 19 1ql~a022 21:43 ?410t1,aAu ~ -- . . ~12~ 20 21 22 23 24 25 26 27 ?8 -- $24032. $e~.101.24.u ~o~xr~ ~ T2~ 10r.10~i002j o1~2d~*004~ -- $2004 . '~2~o~~' 41427L T100?400004210 0.02 d,4~ (4.240211.0. The bill from the Gotham Bar and Grill totaled $1,571.66. It included four lobster dinners ($420), three New York steak dinners ($315), and a variety of other food including SEARCH WARRANT AND AFFIDAVIT 1 2 3 4 5 6 appetizers and dessert. The bill also includes a "Bloody Mary" and wine. The bill was paid by John Kim on his Master Card. I believe the "Mike Muro" referenced in the above documents is in fact "Mike More", the Financial Services Manager for the city of Oxnard. 7 8 9 10 IV. Assistant City Manager Karen Burnham On.August 2, 2010 I interviewed Assistant City Manager Karen Burnham. Ms. Kinaga, an attorney representing the City of Oxnard, also attended this interView. Ms. Burnharn was there voluntanly and free to leave at any time. Burnham said she has been in her current position for thirteen (13) years. She said she was Ken Ortega's immediate supervisor. Burnham noticed irregularities in some of his business contracts and change orders throughout Ortega's tenure as the public works director; however, she never addressed those deficiencies in his performance reviews. She said during a recent personnel investigation of former employee Juan Moreno they uncovered potential wrongdoing by Ortega. This investigation was conducted by Private Investigator Chuck Hookstra and another investigative firm. 11 12 13 14 15 16 17. 18 19 20 Burnham related her concern about a celebration in 2008 that was organized by, Ortega to commemorate the opening of the "Desal Plant." She claimed the celebration was "over the top" with a catered dinner, wine, snacks and decorations. She claimed that the event was so expensive and extravagant that she was concerned about how the event was firnded. She was initially told by Ortega that the event was funded by donations from firms doing business with the City of Oxnard-Public Works Department. She later learned that the event was funded with federal and city taxpayer dollars, and not by donations. 21 22' 23 24 25 o2 6 o27 28 35 SEARCH WARRANT AND AFFIDAVIT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 According to City of Oxnard documents, this event cost tax payers over $67,000. Approximately 300 invited guests attended the party, including Burnham, Sotelo and members of the city council and Mayor Holden. None of these individuals who attended the event claimed this event as a gift on their 2009 Form 700. I believe Ortega's conduct constitutes a violation of California Penal Code Funds, a felony. ? 424 (a), Misappropriation of Public California Penal Code ? 424 (a) states: (a) Each officer of this state, or of any county, city, town, or district of this state, and every other person charged with, thc receipt, safekeeping, transfer, or disbursement of public moneys, who either: (1) Without authority of law, appropriates the. same, or any portion thereof, to his or her own use, or to the use of another; or, (2)Loans the same or any portion thereof; makes any profit out of, or uses the same for any purpose not authorized by law; or, (3) Knowingly keeps any false account, or makes any false entry or erasure in any account of or relating to the same; or, (4) Fraudulently alters, falsifies, conceals, destroys, or obliterates any account; or, (5) Willfully refuses or omits to pay over, on demand, any public moneys in his or her hands, upon the presentation of a draft, order, or warrant drawn upon these moneys by competent authority; or, (6) Willfully omits to transfer the same, when transfer is required by law; or, (7) Willfully omits or. refuses to pay over to any officer or person 'authorized by law to receive the same, any money received by him or her under any duty imposed by law so to pay over the same is punishable by imprisonment in the state prison. . Burnham said as Assistant City Manager she approves Ed Sotelo and members of City Council's travel requests. Bumham said she had never denied a travel request submitted by Sotelo or members of city council. She said there are copies of the travel documents in the City Manager's offiqe and in the Finance Director's Office. She also said the City Manager, Department heads, and members of city council, have city issued credit cards to be used for city business. She said there is a monthly "check register" retained by the Finance Director that itemizes expenses incurred by city officials that she reviews monthly. During the interview, she freely discussed performance issues relating to Juan 36 SEARCH WARRANT AND AFFIDAVIT 1 2 3 4 5 6 7 8 9 10 Moreno and Ken Ortega, but was reluctant to provide information regarding travel details involving Sotelo or members of the city council. During the meeting with Burnham, she advised that Ortega had two laptop computers and that both had been "wiped," meaning that data was erased. She stated that the city's IT people were working on recovering the data. When asked if the city had done a search of their server to recover the data, Burnham indicated that no such search had yet been performed. I believe that relevant information to the Desalter party, and to the failure to report gifts, communications with contractors, and other evidence will be located on the city server. 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 G.C. ? 36514.5 allows city council members to be reimbursed for actual and necessary G.C. expenses incurred in the performance of official duties. ? 53232.2 requires an agency, if it reimburses its members for actual and necessary expenses, to adopt a written policy at a public meeting specifying the types of occurrence that qualify for reimbursement. The written policy must specify the reasonable reimbursement rates for expenses or the agency will be required to use the IRS rates for reimbursement. The agency members are also required to use government and group rates for transportation and lodging when available. Additionally, all expenses that do not fall within the written policy or the IRS guidelines must be approved by the legislative body at a public meeting. oG.C. ? 53232.2 requires the agency to provide expense report forms to be filed by members being reimbursed. These reports are considered public records subject to disclosure pursuant to the Public Records Act. To be reimbursed, the expense must: (1) be an expense of a member of a city council; (2) be an 'actual' expense; (3) have been incurred in the performance of official duties; and (4) be a 'necessary' expense. Based on the information I have obtained during this investigation, I suspect that travel expenses have been incurred by members of city council that were noto necessary nor ) 37 SEARCH WARRANT AND AFFIDAVIT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 incurred in the performance of an official duty: I am requesting credit card information, expense report forms and other relevant documents in this regard. On August 3, 2010, Burnham provided a document to this office in the form of a confidential memorandum from Ed Sotelo to the Mayor (Tom Holden) and city council members dated January 16, 2009 entitled "Great Program Dedication -- Expenses." The document discusses the cost of the Desalter party, minus the contribution of Herzog Wine Cellars (wine, appetizers and commemorative wine glasses) and claims that the party was financed by donations from: Black & V?atch ($2,500); Mainstreet Architects & Planners ($2,500); Prousys ($2,500); Consolidated Electrical Distributors ($3,000); Rockwell Automation ($3,000); Kennedy/Jenks ($4,000); Rawlings Mechanical ($5,000); Z Pipeline ($5,000); AEWTfBiwater ($8,000); and Emma Construction Corporation ($12,000). The document indicates that floral arrangements (described to me by Burnham as "Vegas Style") were donated by Bernardo's. Burnham said that she later learned that the vendors did not donate to the party, and that the true source of the funding may have been the change order by Kennedy/Jenks. She also said that she later learned that Fleur De Lis Flower and Gifts donated or provided the flowers to the party. Based on this information, I am seeking all contracts and related documents with these vendors. On August 10, 2010 I had a brief telephone conversation with Ken Ortega. He said that the grand opening celebration of the Desalt Plant was with the full knowledge of Ed Sotelo, Karen Bumham and all members Of city council. He said that he had to re schedule the event at least once at Sotelo's request because members of city council were going to be out of town. He said that attendees on the guest list were reviewed by the city manager's staff and suggestions as to whO would attend were made. City Public Information Officer Christina Aerland who is on Ed Sotelo's staff, was an active participant in helping plan the event on a day- to- day basis. He also indicated that the event was more upscale than normal because the initial indications were that the Arnold 38 SEARCH WARRANT AND AFFIDAVIT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 Schwarzenegger, the Governor, was going to attend the event. changed plans and did not attend the event. The Governor later On June 26, 2010, Sotelo was provided a list of documents requested by the District Attorney's Office relating to business contracts, travel and correspondence between city officials and firms doing business with the City of Oxnard. Most of these documents should be public records. Regardless, the City of Oxnard has been reluctant to provide these requested items through the informal request process. Few responsive documents have been provided by the city of Oxnard to date. On August 10, 2010, I spoke with Burnham again regarding outstanding documentation. To date, no additional documentation has been forthcoming. Burnham requested "key words" to search their records to assist in locating documents. 15 16 17 18 19 20 21 22 23 24 25 26 27 28 V. Keith London, President and CEO of Kennedy/Jenks On August 4, 2010, I interviewed Keith London, President and CEO of the Kennedy/Jenks Group.. He said Jeff Savard is his office manager at his Oxnard office. Savard oversees operations in Ventura County. London said they have contracts with several government agencies in Ventura. County including the City of Oxnard. He said all contracts and change orders may be retained in their San Francisco headquarters or on-site in their Oxnard office. London said giving gifts to businesses and members of governmental agencies in the form of hosted dinners, lunches, golf outings and tickets to sporting events, are common practices. According to London in 2006, he approved a complimentary, limousine trip, along with Lakers game tickets, for Oxnard officials and three others not connected to Oxnard. The gift giving was proposed by Savard, and even though the limousine service 39 . SEARCH WARRANT AND AFFIDAVIT . 1 2 3 4 seemed to have a bad appearance, it was the most effective way to transport eight clients to and from the basketball game. London recalled the cost for the Lakers game, limousine and dinner was approximately $2,300. London~ claimed that gift giving was not a quid pro quo situatiOn, but common practice to "keep [his] clients happy." These gifts were not 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 reported by Ortega or Herrera, a violation of Caljfornia Penal Code unknown whether Moreno claimed these gifts on his Form 700. ? 118, perjury. It is London said he was concerned about a change order between Ortega .and Savard where there was funding for an elaborate "gala" to celebrate the opening of the "Desal Plant." He said he met with Karen Burnham, Ed Sotelo and a private investigator about the issue. He seemed to indicate that if there was a diversion of money to fund this event, it was not the responsibility of his company to justify the allocation of money, and that it was more appropriate for the City of Oxnard to justifying this expenditure. In my opinion, the V diversion of money to fund this event is a misappropriation of public money, a felony, on the part of all individuals who aided and abetted the diversion. VI. Jeff Savard of Kennedy/Jenks V On August 11, 2010, I interviewed Jeff Savard of Kennedy/Jenks Group. Savard was the office manager for the Oxnard Kennedy/Jenks Group. Savard admitted that he is a personal friend of Ortega, and said that they were college roommates. Savard also acknitted that he had breakfast meetings about every other week and that these breakfasts were mostly paid for by Kennedy Jenks. The breakfast included Savard and Ortega, Juan M?reno and other public works employees (he identified Tony Emmert, Project Manager by name). V V 40 SEARCH WARRANT AND AFFIDAVIT j 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Savard confirmed the fact that there was a Lakers game trip in 2006 that included a limousine ride paid for by Kennedy/Jenks. He claimed that there was no dinner after the game, and said that only Ortega and Moreno (along with their wives) were present. He denied that Andres Herrera was there. He then stated that he might have confused this trip with another trip he and Ortega took to a Laker game. With regard to the Desalter/GREAT project party, Savard said that there was a lump-sum contract paid to Kennedy/Jenks from the City of Oxnard. Ortega paid Kennedy/Jenks $30,000 in public funds over the agreed upon contract price of the project and Savard believed this to be unusual but accepted~ the overpayment Ortega later asked Savard to "donate" money to the grand opening party, and he did that. Savard claims that when the company writes up the original contracts, they include an administrative cost allowance to cover certain expenses (including wining and dining of clients). He denied that there was any change order to cover the cost of the party. He admitted "donating" $4,000 to the party at Ortega's request, even though it put him over budget for one particular project. Savard felt that he and his firm did nothing illegal. /1 / / VII. Andres Herrera, Pro Tern Mayor 1/ On August 12, 2010, I interviewed Andres Herrera, Pro Tern Mayor of the city of Oxnard. Also present was Ted Oehninger of the Federal Bureau of Investigation (hereinafter "FBI"). Herrera was there voluntarily and free to leave at any time. Herrera was advised that the interview was being recorded. Herrera is currently employed 20 hours per week working as an administrative assistant for Supervisor John Zaragoza and has held that position since Zaragoza was elected to his current position in November of 2008. In addition to those duties, Herrera is an elected Oxnard city council member and has been 41 SEARCH WARRANT AND AFFIDAVIT 1 2 3 4 5 6 7 8 9 10 11 o 12 13 14 15 16 17 since 2002. He was also elected for a single term in 1992, but then lost his bid for re election. In connection with his council position, Herrera sits on numerous committees including the Finance Committee and Fiscal Policy Task Force. Herrera admitted that on one occasion he took a limousine to a Lakers' game with Ken Ortega. He did not know who paid for the limousine and did not know who paid for the event 'tickets. He admitted that they went to dinner after the event, but denied that he ate, instead claiming he had two beers and that he paid for those himself. He did not declare the tickets or limousine on his Form 700. II Herrera said that as an elected offi?ial, council is the "boss" of City Manager Ed Sotelo. Herrera said that in his capacity as a councilmember, he has been required to travel to various functions to represent the City of Oxnard. He admitted going to New York in 2008 with Ed Sotelo and his wife, Ken Ortega and his wife, James Cameron and his wife and Michael More and his wife for the "Bond Buyer Awards." Henera indicated that the city was scheduled to receive an award for "creative financing." While there, Herrera and his wife stayed at the Times Square Hilton. Herrera said that they arrived the day before the event and left the day after. He believed that the City of Oxnard paid his fare to NY and his hotel. He paid for his wife to travel. 18 19 20 21 22 2~ 24 25 26 27 28 II Herr?ra admitted that during the trip he attended two dinners. At least one of the dinners was at a place named the Grill (the Tribecca Grill) and someone from the De La Rosa firm was present. Herrera claimed he did not know who paid the bill and thought that Ed Sotelo must have paid for it. He said that Sotelo told him that it was "taken care of." He said that they had a per diem rate, that the city reimbursed them for meals, but was unable to explain if the bill went over his per diem amount. He indicated that everything was covered when he traveled. II 42 .1 SEARCH WARRANT AND AFFIDAVIT 1 -2 -3 4 5 6 7 8 .9 10 11 12 :1,3 Herrera admitted that he was supposed to go to the Theatre with the others in his group, but his wife was ill so he did not attend. He admitted that he attended a second dinner in New York with the group, but also did not have an explanation as to how the bill was paid. Herrera said that he did not feel he had any obligation to report the meals on his V V Form 700 and he did not report them. I/I /1 Herrera admitted that on a separate occasion he attended the League of Cities conference in San Francisco (in 2005). Ed Sotelo was also there. Ken Ortega was there but had to leave because hi~ wife went into labor. Herrera and Sotelo played golf at the Presidio golf Course with Ed De La Rosa. He did not know who paid for the golf, but he did not. He did not declare the golf on his Form 700. II Herrera said that he has had regular training on reporting and ethics. He is familiar with the Form 700 and has the supplement at home. He admitted that he did not exercised diligence when signing his Form 700 under penalty of peijury. Il Herrera Telephone Call with Sotelo /I On a brief break during the August 12, 2010 interview of Herrera, Agent Oebninger and I left the interview room. The audio recording equipment in the interview room was still operating and Herrera did not know that I was monitoring the interview room from another location within the building. Herrera placed a phone call to Ed Sotelo. Sotelo spoke loudly during the call on Herrera's cell phone and much of Sotelo's part of the conversation was audible. All of Herrera's statements were clear. Sotelo advised Herrera that the city attorney was involved and said that Herrera should have representation before talking to the District Attorney. H?rrera said that he wished he had known before coming down and reminded Sotelo that he told him in advance that he was coming to the office. V :1~4 15 16 17 18 19 20 21 22 23 24 25 26 27 43 SEARCH WA~RRANT AND AFFIDAVIT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Herrera then proceeded to briefly speak to Sotelo in Spanish, and then began to tell Sotelo that what areas he was being questioned about, specifically regarding golf and trips. II Shortly after Herrera and Sotelo beganthis conversation, FBI agent Oehninger returned to the interview room. Herrera pretended to tell the person on the other end of the phone to watch his dog. Herrera then started pretending that he had been talking to someone about the River Ridge training camp area ~nd said that they were coordinating some soccer teams that were going to use the fields when the Cowboys were not using the area. Before con?luding the interview, Henera was specifically asked who he had spoken to during our brief recess. He admitted that it was in fact Ed Sotelo, but claimed that they were talking about the River Ridge fields. Herrera. /1 I' ll VIII. City Attorney Alan Holmberg II Within minutes of Herrera talking to Sotelo and telling him what areas of the interview we were questioning him about, DA Investigator Jeff Barry received a telephone call from St'even Fischer, an assistant city attorney for the City of Oxnard. I was advised by Glen Kitzmann, Deputy Chief Investigator of Special Operations, that Kitzmann spoke with Mr. Fischer about city employees who were being interviewed by the DA. Fisher Agent Oehninger and I then finished the interview of expressed concern that the witnesses should be represented by counsel and would not be honoring their previously scheduled appointments. He said that City Attorney Alan Holmberg was out of the office, but that he 'would be contacting him to determine how to proceed. II 44 V SEARCH WARRANT AND AFFIDAVIT Thereafter, Kitzmann and DDA Karen Wold had a telephone conference call with Holmberg and Fischer. Holmberg expressed concern that the FBI was involved in the investigation, He wanted to know what the investigation involved and who the targets were, Holmberg was advised that the subject matter ofthe investigation wasconiidential, and did not involve a civil matter against the city. I-Iolmberg stated that he did not want to have city employees giving interviews to the DA without proper representation. He made it clear that he believed the city should provide representation to witnesses and/or targets in a criminal investigation to protect city employees. He said that he wanted to wait at least another week before he believed that the employees should be interviewed. Holrnberg was advised that he wasimpeding a criminal investigation. He finally acknowledged that the employees would each make .their own decision regarding whether or not to talk the DA, but he wanted to make sure that they understood that they have a right to counsel. IX. Pre-text Phone Calls On August 12, 2010 at 7:48 p.m. Ken Ortega came into my office and made a recorded telephone call to Edmund Sotelo on his cellular phon! I monitored the call. Ortega told Sotelo that he had been contacted by the District Attorney's Office and they wanted to interview him about the New York trip and the San Francisco bond rating trip. Ortega told Sotelo that he knew that John Kim paid for dinners and theater tickets. Sotelo responded "You are going to have to tell them-what you know, I don't know.". Also on August 12, 2010 at 7:54 p.m. Ken Ortegaithen made a monitored and recorded telephone call from my office to Andres Herrera on his cell phone leit a message to call him. Herrera called Ortega's cell phone back within two minutes and 4 5 WARRANT AND AFFIDAVIT 1 2 3 4 5 6 7 8 9 10 11 12 13 14. 15 16 7. 18 19 20 21 22 23 24 25 26 27 28 this call was monitored and recorded. Herrera told Ortega that he had come into the District Attorney's Office earlier in the day. Herrera said that he told investigators that he did attend Lakers' game trip and the trip to New York. Herrera told Ortega that with regard to the dinners on the New York trip, he was told by Sotelo that the bill had been covered. He told Ortega that he did not confirm who had paid the bills. Herrera then told Ortega, "He's trying to throw me under the bus," referring to Sotelo. Il /I X. City Finance Officer James Cameron On August 12, 2010, Agent Oehninger and DA Investigator Barry interviewed James Cameron and Investigator Barry told me the following; Cameron is employed as the Chief Financial Officer of the City of Oxnard and was hired. on April 14, 2008. He was hired by Oxnard City Manager Sotelo. Cameron attends all city council meetings as part of his required duties. Cameron oversees the Finance Department which is responsible for Cameron said he received an payroll, general accounting, and budget functions. introduction to the Form 700 document at the time he was hired. He said he has reviewed these forms and the examples provided within them regarding certain reportable situations. Cameron was not aware of any ongoing training regarding these documents. II Cameron attended a city function in New York in December of 2008 for which the city received an award. He was not part of the work that led to the award. He stayed at a hotel with other city officials in New York for a period of five (5) days. He was told the city paid for the hotel for five (5) days because of a "discounV' they received for staying that amount of time. Cameron said this arrangement was already worked out in advance because he filled in for the Mayor who could not attend at the last. minute. Cameron said his wife attended this New York event with him, and he paid for her flight. Other city personnel in attendance were City Manager Sotelo, Mayor Pro .Teffi Herrera, and ~ublic Works Director Ortega. All spouses of the other city officials also attended. Cameron said 46 .~ SEARCH WARRANT AND AFFIDAVIT 1 2 3 4. 5 6 7 8 9 .10 11 12 13 14 15 that John Kim from De Ia Rosa paid for all city officials and their spouses to attend a play. He was not sure the name of the play. John Kim also paid for one dinner for city officials and their spouses and one lunch for city officials and their spouses. Cameron said he reported $75 on his Form 700 for the tickets to the play he received. He said he did not' report the ticket his wife received because he thought he did not have to. He said he did not report the meals because he did not consider them as "gifts." ,// . ~,j Cameron said that he attended a Dodgers Game with Ortega, an unknown Los Angeles City Official, and John Kim in the summer of 2008. Ortega drove the four of them to the ganie. Cameron was not aware of the exact date, but he remembered the Dodgers won the game. Cameron said the seats included "free food" and were located behind the Dodger dugout. Cameron said he reported this as a gift of $300 on his Form 700. He said he called John Kim when it was time for him to complete the form to find out exactly how much the ticket he received was worth. Kim told him it was worth $300. 16// 17 18 19 20 21 22 23 24 Cameron said it was ultimately his decision through consultation with the City Manager to use the De la Rosa firm to negotiate and purchase bonds on behalf of the City of Oxnard. Cameron said he was unsure of the annual profit received by De la Rosa from the relationship it had with the City of Oxnard because he said the figure would be complex to determine due to the fact that De la .Rosa sells some bonds right away and holds on to others that it receives from the City of Oxnard to possibly sell at a later date. He estimated that De.la Rosa makes between $100,000 and $200,000 per year through business it does with the City of Oxnard. 25/I 26 27 28 Cameron attended a two-day city event in San Francisco which he described as a bond rating meeting. He said that John Kim paid for a nice dinner for those that attended. He said the dinner was at the Cliff House restaurant. 47 SEARCH WARRANT AND AFFIDAVIT 1 2 3 4 5 .6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 /1 Cameron was asked by the City Manager Sotelo to send out inquiries to firms that had organized the gala party for the Desalt Plant. He said he attended this event and thought it was an expensive one because there was catered food. He was told by the City Manager to send out letters to all of the firms who they believed organized the event. The letters asked the firms if they gave donations to the City of Oxnard. Only three or four of the seven firms responded (which he described as half). Of those that responded, none of them indicated they had donated money to the City of Oxnard. Cameron said he was confused by this, but thought that an explanation could be that the firms paid the vendors directly for the event without involving the City of Oxnard. 7/ Cameron also said he was aware of an issue with "change order&' involving the building of the Desalt Plant. He said these occurred prior to his employment. In looking into the matter, Cameron said there seemed to be a discrepancy between the rules in the budget document for the project and the rules in the budget manual used by the city. Cameron said depending on which manual one would read, they could view it as being acceptable or not acceptable for a manager to approve the change orders for the project. He was aware that Jose Moreno had been fired by the City Manager Sotelo. h When asked if Cameron saw a conflict of interest based on the fact that he was responsible for selecting and recommending De la Rosa and the fact that he had personally accepted and not reported all gifts from the company, Cameron said he did not see this as a conflict, although he agreed that other people could perceive a conflict. // On August 13, 2010 at 10:00 a.m., I had a discussion with Deputy Chief Investigator Glen Kitzmann. He had returned from Oxnard City Hall after meeting with Assistant City 27. Manager Karen Burnham, Human Resources Director Michelle Tellez and Executive 28 Assistant Catherine Kinney. Kinney provided Kitzmann with two bankers boxes 48 SEARCH WARBANT AND AFFIDAVIT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 containing documents, one containing city council minutes that filled approximately 1/2 box and the other box contained a few documents from ARRA Funding, DeLaRosa and company and JVW Communications. Burnham originally told Kitzmann yesterday that she would provide two or three banker's boxes. Bumham told me on August 11, 2010 that she would be providing documents to me that I would find "interesting." I have had an opportunity to briefly review the documents provided today by Burnham and the majority are insignificant. It does not appear that the majority of documents requested have been produced. Burnham claimed that Ortega's computer had been "scrubbed" and that they believe the majority of the documents we are seeking were on that computer. She claimed that they are currently having their IT people try to recover the documents. Request for Sealing of Search Warrant II This search warrant is requested as part of an ongoing investigation regarding Peijury and Misappropriation of Public Funds and potential Conflicts of Interest which are felonious violations of California law. It is expected that the investigation will continue with additional surveillance, intelligence gathering, and search warrants forthcoming. Therefore, it is important that this search warrant be sealed to prevent its release to the public as a judicial record, which is required by Section 1534 of the California Penal Code. If the existence of this search warrant is made public, it could. give the suspect(s) of this investigation an opportunity to destroy evidence, hamper the investigation, notify confederates, or flee from prosecution. It is likely that the service of this warrant may produce evidence of criminal activities involving suspect(s) now yet known and that the revelation of the facts set forth in this affidavit may cause or motivate these as yet unknown suspect(s) to flee or destroy evidence. Without sealing the entire search warrant, this affidavit will become a 49 SEARCH WARRANT AND AFFIDAVIT 1 2 3 4 5 6 7 8 9 10 matter of public record within 10 days. Sealing is justified even against discovery by the suspect(s) based on the governmental privilege allowing for the protection of official information pursuant to Evidence Code sections 1040-1042. Southern California Regional Hi-Tech Task Force The Southern California Regional Hi-Tech Task Force (SCHTTF) is a state funded law enforcement group formed to identify and investigate high technology crimes. The task force includes investigator/examiners from local, state and federal agencies, who receive specialized training in the recovery of digital evidence. Some members of the task force are civilians and not considered "peace officers" for the purposes of serving a state- 12 13 14 15 16 17 18 issued search warrant in California. They are however, trained by sworn peace officers and they will be working under the supervision of sworn peace officers executing this search warrant. As provided for under California Penal Code section 1530, I will need the assistance of fellow members of the task force to serve this warrant. I am requesting that the court authorize members of the task force to accompany the peace officers executing this warrant for the purpose of assisting in the service and execution of this warrant. V 19 20 21 V F understand it is a common and accepted practice to create exact duplicate images of computer hard drives on scene in cases where the digital evidence itself is not contraband and where the seizure will have an adverse effect on lawful business interests. Member of the SCHTTF will first determine the feasibility of an on-scene acquisition of evidence. If a computer is mission critical to the business and can be safely imaged at the location, SCHTTF members will complete the acquisition at said location. There are many factors that could make this procedure impractical and/or ill-advised. These factors included certain types of hardware, hard drives, software, as well as storage devices. If any of these factors are present, in the sole discretion of the computer forensics examiners, it will 50 V 22 23 24 V V 25 26 27 28 V / SEARCH WARRANT AND AFFIDAVIT V V 1 2 3 4 5 6 7 8 9 10 11 12 13 be necessary to remove the affected computer systems from the scene and image them offsite at a computer forensics facility. II In my training and experience, I know that the forensic examination of a computer and computer storage material is a time consuming and laborious task requiring specialized tools including tools and programs. that enable a forensic examiner to locate items that a computer user believes have been deleted. For this reason, as well as reasons mentioned above, the computer and computer storage media must be searched offsite using specialized tools. With relation to other types of media or devices that are not mission critical, those items will be seized and imaged in a controlled laboratory environment, and returned upon completion~ I understand often times acquisition of such data or devices can take hours or days to complete and may require specialized equipment to complete the process. 17 18 19 20 21 22 23 24 25 26 27 28 ~ request authorization to seize compuver(s) and computer data; to read information stored and contained on any seized computer(s) and computer data and copy such data for evidentiary purposes. The search shall include the inspection of any computer based storage media, whether locked or unlocked, contained at the location described in this affidavit. / In order to preserve an accurate record, I request permission to videotape andior photograph the execution of this search warrant. I expect to examine computer(s) at the scene of the search. Those computers may be operating when I arrive at the premises. The images on the screens of the computers are transient (they disappear when the computer is turned off). I need to be able to videotape any such images because they may be evidence (e.g., incriminating documents being written by the user when the SEARCH WARRANT AND AFFIDAVIT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 search warrant is executed). The videotape may. be useful in documenting what was done to the computers. Photography of the location and persons present at the scene is also often helpful in showing possession of the premises and evidence of association of the parties. Request to Allow Federal Agents to Assist with Search // I also request that the court authorize agents from the Federal Bureau of Investigation to assist with the execution of this search warrant. This case is a joint investigation with the Ventura County District Attorney's Office and the Federal Bureau of Investigation. I believe the funds that were allegedly misappropriated for the Desalt PlantlGreat,Project grand opening ceremony may be in part federal funds designated for other programs or projects. I have been advised by Special Agent Ted A. Oehninger that he believes approximately $20 million dollars in Federal funds was slated for phase one of the GREAT project. Oehninger has probable cause to believe that the acts may constitute the following federal violations; Hobbs Act [Title 18, USC, ?1951] . a) Whoever, in any way or degree, obstructs, delays or affects interstate commerce, b) by obtaining property from another, with consent, induced by wrongful use of actual or threatened force, violence, fear; or c) under color of official right, which includes misuse, or misuse under reasonable 21 22 23 24 25 26 27 28 . apparent authority, of one's office to induce paymentsnot due the person or office;or. d) attempts or conspires to do so; e) shall be fined or imprisoned not more than 20 years, or both. Conspiracy [Title 18, USC, ?371] a) If two or more persons; b) conspire either to commit any offe~se against the United States; or, SEARCH WARRANT AND AFFIDAVIT 1 2 c) defraud the United States or any agency thereof in any manner or for any purpose; and d) one or more of such persons do any act to effect the object of the conspiracy; e) each person shall be fined or imprisoned not more than five years, or both, 5 6 7 8 9 10 11 12 13 however; f) if the object offense is a misdemeanor, then each person shall not be imprisoned for more than one year. Aiding and Abetting [Title 18, USC, ?2] a) Whoever commits an offense against the United States; or, b) aids, abets, counsels, commands, induces or procures its commission; or~ c) willfully causes an act to be done, which if directly performed by him/her or another would be an offense against the United States; d) is punishable as a principal. 16 17 18 19 20 21 22 23 24 25 26 As such, I request that agents with the Federal Bureau of Investigation be allowed to participate and assist in the execution of this search warrant as they have specific expertise that will assist with this investigation and search warrant service. /1 // I! II 27" 28 - 53 SEARCH WARRANT AND AFFIDAVIT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 ' Computer Search and Di2ital Media I believe that the City of Oxnard uses e-mail, networks, and computers to effectively conduct city business. I believe e-mail messages, networks, and computers located within the places to be searched will contain evidence regarding the crimes described herein. Therefore, I am requesting trained computer forensic investigators from the Southern California High Tech Taskforce search and seize the following items, images, photographs, records, or evidence including: Any of the aforementioned evidence described in the Search Warrant Order whether in documentary form or contained on electronic storage devices capable of storing electronic data, including, but not limited to, computers, servers, laptops, cellular phones, (including Blackberries and I-Phones), Personal Data Assistants (PDA's), computer systems incl~iding central processing units; internal and peripheral storage devices such as fixed disks, external hard disks, floppy disk drives and diskettes, thumb drives, tape drives and tapes, optical storage devices or other memory storage devices; peripheral input/output devices such as keyboards, 'monitors, printers, mouses, joysticks, light pens optical readers, writing pads, devices such as modems, software to run programs, printers and manuals for the operation of the Computer(s). This also includes all writings and documents, which tend to establish the identity of the person(s) in control of the computer and computer equipment and this is to include all computer data receipts, registration forms, canceled checks,, warranty documents, purchase agreements, lease agreements, any computer logs, sign in sheets, notes, passwords or access codes. '. ' CONCLUSION Based on my training .and experience 'and the' information obtained during the course of this investigation, I believe City Finance Director James Cam?ron attended the Bond Buyers awards banquet in New York on city~ business, but underreported the gifts 54 SEARCH WARRANT AND AFFIDAVIT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 provided by the De La Rosa Company for dinners and theater tickets and falsified his Form 700, which he signed under penalty of perjury, a felony violation of Penal Code section 118. I further believe that Cameron attended a function in San Francisco, but failed to report a dinner that was provided by the De La Rosa Company at the Cliff House on his Form 700 , which he signed under penalty of perjury, a felony in violation of Penal Code section 118. I also have probable cause to believe that Cameron accepted gifts from the De La Rosa Company in excess of $420 in a given calendar year, and then entered into contracts with them, a felony violation of G.C. 1090. I further believe City Manager Edmund Sotelo failed to report a golf outing and an expensive dinner provided by the De La Rosa Company on two different trips to San Francisco. In addition, he failed to report hotel rooms, dinners and theater tickets for he and his family provided by the De La Rosa Company. He failed to report these gifts on his Form 700's, which he signed under penalty of perjury, a felony violation of Penal Code section 118. I also have probable cause to believe that Sotelo accepted gifts from the Dc La Rosa Company in excess of $420 in a given calendar year and entered into contracts with them, a felony violation of Penal Code section 1090. I also have probable cause believe that Sotelo aided and abetted the misuse of public funds and/or aided and abetted in the use of funds for a purpose not authorized by law with regard to the Desalter function, a felony violation of Penal Code section 424 Moreover, I believe Mayor Pro Tern Andres Herrera failed to report a golf outing in San Francisco hosted by the De La Rosa Company, the New York bond buyers trip including a hotel room, expensive dinners and theater tickets for heo and wife. He received the limousine trip to the Lakers basketball game and dinner hosted by the Kennedy/Jenks Company. He failed to report these gifts on his. Form 700's, which he signed under penalty of perjury, a felony violation of Pcnal Code section 118. 55 SEARCH WARRANT AND AFFIDAVIT 1 2 3 4 5 6 7 8 9 V Furthermore, I believe former Public Works Director Ken Ortega failed to report the dinner in San Francis?o hosted by the De La Rosa Company, the limousine trip, tickets to a Lakers game and dinner hosted by the KennedylJenks Group. He failed to report these gifts on his From 700, which he signed under the penalty of perjury, a felony violation of Penal Code section 118. II V Therefore, based on my. training and experience and the information contained in this affidavit, I have formed the opinion that a search of Oxnard City Hall will result in the seizure of evidence tending to show that Public Works Director Ken Ortega, City of Oxnard Manager Ed SOtelo, Mayor Pro Tern Andres Herrera, Chief Financial Officer James Cameron and Public Works Project Manager Juan Moreno and other unidentified suspects have committed a felony(ies). 10 11 12 13 14 15 16 17 18 o 19 20 21 o 22 23 In my opinion there is probable cause to believe that grounds for the issuance of a search warrant exists as set forth in California Penal Code ? 1524 based on the aforementioned facts and circumstances at: (1) Oxnard City Hall, 300 West 3rd Street, Oxnard, California; and (2) City of Oxnard Civic Center, 305, West 3~ Street, Oxnard, California. This investigation into allegations conflict of interests and misappropriation of public funds is continuing. Disclosure of the contents of the affidavit to the suspect and/or any person listed in the affidavit would compromise surveillance efforts, jeopardize officer safety, and would frustrate the continuing investigation of this, case. Furthermore, 24 .25 26 27 28 56 SEARCH WARRANT AND AFFIDAVIT additional search warrants, arrests and seizures of contraband are contemplated in this investigation. If the search warrant affidavit is made public, it will impair further related investigations. -4 1 2 3 4 5 6 7 8 9 10 11 12 13 .14 15 16 17 18 19 20 21 22 23 24 o o 25 26 27 28 I believe the necessity for preserving the confidentiality of the information contained in the affidavit outweighs the necessity for public disclosure. Therefore, I request, pursuant to Evidence Code section 1040, that the search warrant affidavit be sealed pending further order from this court. I declare under penalty of perjury that the foregoing is true and correct to the best of my knowledge. Dated: Au~ist 13 ,2010 ___________ Wayne Simmons Senior Investigator 57 SEARCH WARRANT AND AFFIDAVIT