Ex-Moriarty Aide Adds to Charges of Political Payoffs

Richard Raymond Keith, a key figure in the W. Patrick Moriarty political corruption case, named dozens of California politicians--from major players to minor participants--in interviews with the FBI, telling federal agents how he and Moriarty used cash and other inducements, including prostitutes, to influence lawmakers.

According to FBI records of the interviews, Keith alleged that:

- Orange County Supervisor Bruce Nestande, who now is a GOP candidate for lieutenant governor, tried to solicit a campaign contribution for Gov. George Deukmejian’s 1982 campaign in return for helping to steer a contract for a new Orange County dump to one of Moriarty’s business associates. Nestande vehemently denies the charge, saying that he would be happy to take a lie detector test on the subject. Others also deny the allegation.

- He paid $10,000 in cash to then-Assemblyman Bruce Young (D-Norwalk) and also bought $1,100 in clothes for Young at a time when Keith was seeking the assemblyman’s help with a cable television issue. Young could not be reached for comment.

- Long Beach City Councilman Jim Wilson and state Public Utilities Commissioner William T. Bagley should be added to a previously disclosed list of six elected or public officials who were provided with prostitutes. Wilson said he would not comment on the matter, and Bagley denied the allegations, saying, “I know nothing about it, period.” Bagley, a former assemblyman from Northern California, was an attorney in private practice at the time Keith said he received prostitutes.

- A total of 38 elected officials and other public officials, businessmen and fireworks company employees were given the services of about 60 different prostitutes in at least 10 California hotels. Keith could name only 10 of the women.

- A charitable organization was used to funnel campaign funds to Rep. Matthew G. Martinez (D-Monterey Park). Martinez, only one of many officials at the local, state and national level who Keith has said received laundered campaign contributions, denied knowledge of the alleged money-laundering scheme.

Moriarty Won’t Comment

Moriarty, through his attorney, Jan Lawrence Handzlik, declined comment on any of the specifics mentioned in the Keith interviews.

“Mr. Moriarty will not engage in a public debate on those subjects with Richard Keith or anyone else,” Handzlik said.

Moriarty has pleaded guilty to seven counts of mail fraud relating to bribery and illegal campaign contributions and is scheduled for sentencing in federal court next month.

The Keith interviews, which took place between Dec. 7 and Dec. 15, 1984, were conducted by the FBI, the Internal Revenue Service and Orange County district attorney’s investigators at a time when Keith, 48, was under indictment on five counts of tax evasion and bankruptcy fraud and was cooperating with law enforcement officials.

Keith subsequently broke off the interviews, was reindicted on more charges, pleaded guilty to six felony counts and is awaiting sentencing. In recent months, according to letters written to federal court Judge Terry J. Hatter, Keith again has been cooperating with law enforcement, but transcripts of those interviews were not available.

Keith’s attorney, Brian O’Neill, in a confidential letter to Hatter Oct. 14, wrote “ . . . Mr. Keith provided (investigators) a broad range of information about political corruption and financial fraud . . . “ in recent interviews.

“Specifically, Mr. Keith has provided information relative to the efforts of W. Patrick Moriarty and his associates unlawfully to influence state, county and city legislation which would benefit “ Moriarty’s fireworks interests.

Assertions About Young

According to the FBI records, Keith told agents that he paid Young $10,000 in cash and accompanied Young to a store, where he bought the former assemblyman $1,100 worth of clothes.

Young was instrumental in helping Moriarty win legislative passage of a bill that barred local governments from outlawing the sale of so-called safe-and-sane fireworks, the type manufactured by Red Devil fireworks company, which was controlled by Moriarty at the time. The bill subsequently was vetoed by then-Gov. Edmund G. Brown Jr. Young did not seek reelection to the Assembly in 1984 and now is a successful Sacramento lobbyist.

The Times previously disclosed that Moriarty also provided Young with the use of a Ford Bronco in 1981 and 1982 while the fireworks bill was before the Legislature and that Young’s former wife, Jo Ann, received about $18,000 as the return on an investment in a Baldwin Hills condominium developed by Moriarty.

Reportedly Paid for Spa

Keith told the law enforcement interviewers that Moriarty paid for a spa at Young’s home, reportedly as a return on the Baldwin Hills investment.

“Keith also recalled Moriarty once telling him to meet Jo Ann Young at a spa sales showroom and a spa is subsequently selected and installed at Young’s house,” the record of one Keith interview said.

In late 1983 and again in about February, 1984, Keith told investigators, he diverted a total of $10,000 in cash from the rent payments of occupants of the Baldwin Hills condominium project and gave the money to Young.

Keith said he made the payments after asking Young to intercede with a cable television company.

“Keith mentioned that Young knew everyone in the cable TV business because he was responsible for cable legislation,” the FBI report said. “Young told Keith that he would not help anyone until Moriarty paid him the money owed (from Young’s reported investment in the Baldwin Hills project). Keith then told Young that he would assist him in recovering the money from Moriarty in return for Young’s assistance in the cable contract.”

Adds Two Names

The Times reported in January that Young and several other state and local lawmakers also were recipients of prostitutes’ services paid for by Moriarty. In the FBI interviews, Keith recited that list and added two new names.

The list included Young, Assembly Democratic Leader Mike Roos of Los Angeles, Assemblyman Richard Robinson (D-Garden Grove), Los Angeles City Councilman David Cunningham, Orange County Supervisor Ralph B. Clark, and former Los Angeles City Fire Chief John C. Gerard. The new names were Long Beach Councilman Wilson and PUC Commissioner Bagley.

Young, Clark and Gerard denied the allegations, while Roos refused to comment. Robinson called the allegations “ludicrous,” and Cunningham said they were “ridiculous.”

Keith told investigators that Nestande allegedly solicited a $10,000 campaign contribution from Moriarty and his business associate, R. E. Wolfe, on behalf of Deukmejian’s 1982 general election campaign.

The $10,000 was in return for a county landfill contract, according to what Keith said in the FBI summaries of his interviews.

Two Deny Charges

Nestande and Wolfe both have denied knowing anything about the supposed solicitation. “I don’t raise money that way (by soliciting contributions in return for government favors),” Nestande said. “I would be willing to sit down beside Richard Keith and take a lie detector test.”

The county did consider getting private operators to run the landfills but has since scuttled the idea.

Keith said the $10,000 contribution was made to Deukmejian by former Moriarty employee Albert Hole.

Hole has said he laundered $10,000 of Moriarty’s money to Deukmejian in the fall of 1982, but he told The Times that he never heard of the alleged solicitation by Nestande. He said he told an Orange County Grand Jury that he gave the money at Moriarty’s behest and was reimbursed by Moriarty, a practice that is illegal in California. State law requires that the true source of all campaign donations be disclosed.

Nestande acknowledged that he received $18,000 in laundered money from Moriarty. He returned it in the summer of 1983 after learning that it was laundered.

Laundered Contributions

“I consider this (Keith’s statements to the FBI) retribution for turning back the earlier contributions from Moriarty,” Nestande said. The Times has identified more than $250,000 in laundered contributions given to dozens of elected officials since 1980 by Moriarty and his associates, much of it to state legislators during the time the fireworks bill was pending and in the months immediately afterward.

The FBI reports said: “Keith indicated that (Assembly Speaker) Willie Brown (D-San Francisco), (Assembly Democratic Leader) Mike Roos (of Los Angeles), (Assembly Speaker pro tem) Frank Vicencia (D-Bellflower) and (Assemblyman) Richard Alatorre (D-Los Angeles) were key to the bill.

“Keith stated that Young handled . . . eight to 10 people (legislators) and once chastised Moriarty for providing money to the lieutenant governor (candidate) Leo McCarthy (D-San Francisco) because he could not do anything for him (Moriarty).”

All of the legislators who at some point received reportedly laundered contributions denied knowing anything about the money washing.