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Viramontes Publicizes Confidential City Credit Card Numbers

In her zeal to fabricate and expose an alleged scandal in the mayorís office that is already old news and has nothing to do with the mayor, Councilmember Viramontes dramatically dropped an inch-thick stack of financial records on City Council members and the public at the beginning of last nightís meeting. The last-minute document delivery was reminiscent of last summerís delivery of the Chevron Community Benefit Agreement to councilmembers minutes prior to the City Council meeting.

Then, like a wannabe prosecuting attorney, she proceeded to go through each item, pointing out what everybody already knew and had been covered in the media over two months ago, that former aide Parin Shah had apparently fabricated records to show credible recipients of grants from the mayorís discretionary fund left over from previous private fund raising projects. In fact, a significant amount of  money had apparently been diverted to yet undetermined destinations, speculatively, Shah himself.

What Viramontes neglected to understand is that the records contained real credit card numbers from several City accounts that are still active, and anyone with a criminal bent could use the numbers for fraudulent purchases. Normally, such information would de redacted before distributing records publicly.

But that didnít slow down Viramontes, who was clearly on a mission.

Ultimately, Richmond Department of Finance staff, who did not have copies of what Viramontes distributed, had to scramble around and work overtime into the night to find the publicly disclosed account numbers and have them cancelled.

While Viramontes was critical of the mayor for approving purchase records falsified by the mayorís aide, she neglected to concede that she had engaged in essentially the same practice, herself, for the last six years. Each week, a complete list of all checks issued by the City, along with details of the purchases and payees, is provided to all councilmembers. Each councilmember has an opportunity to review the check register, bring up any concerns with the finance director and ultimately bring any unresolved issues to the City Council. By not taking advantage of this opportunity, a councilmember implies confidence that staff has accurately and appropriately made payments. Viramontes has never challenged a check listed in the check register in six years, including any payments that are the subject of her criticism of the mayor, yet she hypocritically excoriated the mayor for trusting her staff and doing the same thing.

Of course, the real objective of Viramontesí exhibition was to try to embarrass the mayor and anyone connected with her in hopes of scoring some pre-election political points to benefit the three incumbent members of the Chevron Five running for re-election.

Following is the West County Times coverage of the incident:

Bid to scrutinize mayor's office spending highlights division on Richmond council

By Katherine Tam
West County Times

Article Launched: 10/08/2008 05:09:51 PM PDT

Talk of increasing oversight on expenses in the Richmond mayor's office is exposing divisions on the City Council.

The recommendation comes as the Contra Costa District Attorney's Office investigates whether Mayor Gayle McLaughlin's former aide misused city-issued credit cards to give $50,000 to a San Francisco nonprofit group he used to work for.

Councilwoman Maria Viramontes on Tuesday proposed establishing a new audit committee to review monthly expenditures by the mayor and her aides, resurrecting an old policy for the council to review all city expenses and allowing for random department reviews of credit card use.

The proposal drew sharp criticism from the mayor's supporters, some of whom saw the move as "character assassination" and political maneuvering four weeks before the City Council election. Viramontes defended her proposal, saying, "At some point, there is a responsibility to ask a question how something happened and how you fix it."

A divided council discussed the issue at length Tuesday night but did not take action. The matter is slated to return for a vote Oct. 21, when Councilman Jim Rogers plans to direct City Manager Bill Lindsay, regarded by many as apolitical, to review the proposal and determine whether it has merit.

"We have a deeply divided city at this point, we have a deeply divided council," Rogers said. "I think it's truly, truly tragic. The underpinning of what we're talking about is a reflection of deep divisions and a very deep lack of trust."

Viramontes released an inch-plus-thick stack of billing statements, credit card receipts and other fiscal records from the mayor's office from June 2007 to March. The records carry credit card expenses by Parin Shah, a former aide to McLaughlin who resigned early this year.

The finance division noticed a problem in mid-February and alerted McLaughlin, who said she confronted Shah and notified the city manager and city attorney. The city then contacted the district attorney's office.

The investigation became public in August, when McLaughlin issued a prepared statement after she said a county confidentiality request was lifted.

Viramontes questioned why the mayor's signature appeared on possibly fraudulent expenses.

"During the (2004) budget crisis, one of the issues we decided was to have managers responsible for their employees when they exercise use of their credit cards," Viramontes said.

McLaughlin said she had ongoing discussions about expenditures with Shah, whom she trusted, and signed monthly statements based on the verbal exchange. She said Shah made some expenses without her authorization.

"There was no one that was extremely shocked more than me, extremely disturbed when this came to light that a trusted aide in my department was making unauthorized expenditures," McLaughlin said. "In a manager's office, they do not have time to look over every piece of documentation."

The public's and council's reaction to Viramontes' request underscored Richmond's political divisions.

Members of the Council of Industries urged city leaders to consider increased oversight on city finances, and the mayor's supporters said McLaughlin handled the discovery of possible credit card misuse correctly.

Councilwoman Myrna Lopez, who supports Viramontes' proposal, said: "There are policies that everyone in the city needs to follow when it comes to credit cards. There is a process in place for a reason."

Councilman Tom Butt questioned the purpose and timing of the proposal.

"It's all being cleaned up," Butt said. "The district attorney's office is doing an investigation. The people responsible for it will probably be punished. Both the staff and the mayor's office have changed their procedures so things like that will be more difficult to happen in the future. What do you want, other than to try to embarrass somebody?"

Under the old policy, in which the council received thick stacks of all city checks to approve each month, it was impossible to review and cross check every expenditure, he said.

City officials said they hope to recover most or all of any misspent money through the city's insurance policy, legal action or other avenues.

Reach Katherine Tam at 510-262-2787 or ktam@bayareanewsgroup.com.