Posted on 01/13/2005 4:52:39 PM PST by BurbankKarl
A Los Angeles federal grand jury today indicted a former high-ranking executive of the Fleishman-Hillard public relations firm for his part in a scheme that defrauded the Dept. of Water and Power of at least $250,000 and cheated private clients by lesser amounts.
The indictment alleges that John Stodder, Jr., a one-time partner and senior vice president who ran the firm's local public affairs practice, participated with "others known and unknown" to routinely submit inflated billings to the DWP, the Port of Los Angeles, the World Wide Church of God and the firm of world-renown architect Frank Gehry.
Law enforcement sources hinted that Stodder's indictment — the result of a joint investigation involving the FBI, the Los Angeles District Attorney's office and the U.S. Dept. of Transportation — may not be the only one they may seek during an investigation that has cast a pall over the reelection campaign of Mayor James K. Hahn, who had close ties with former Fleishman executives.
The Times revealed the overbilling scheme last year in an article quoting seven former Fleishman-Hillard employees as saying they were encouraged-and sometimes told-to falsify their hours each month under a $3 million public relations contract with the DWP.
Two of the employees said that Douglas R. Dowie, a former partner and senior vice president who ran the Los Angeles office, was aware of and encouraged the phony billings, which at times amounted to $30,000 a month.
The allegations prompted Fleishman to relinquish its DWP contract, Hahn to sever all other public relations pacts at City Hall and City Controller Laura Chick to launch an audit, which subsequently found $4.2 million in unsubstantiated charges by Fleishman to DWP.
(Excerpt) Read more at latimes.com ...
Hmmm... How to phrase this without getting in hot water? 4.2 M is very likely the tip of the iceberg when it comes to problems in LA. The problem is that when exposed through various audits or other disclosures the City Attorney is rarely interested in pursuing the matter. I have first hand experience there and speak with some degree of certainty in this area.
I hate when the Net closigned on me!
Is it frieday yet?
FMCDH(BITS)
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