SD City Council Narrows Legal Defense Guarantee for Ex-Pension Execs

May 3, 2006 ( - San Diego's City Council on Tuesday repealed an ordinance that would have paid for a comprehensive legal defense for the six ex-trustees of the city's pension system that face conflict-of-interest charges.

In January a California Superior Court judge found that there was enough evidence to try the six former officials accused of committing a crime by approving a plan that allowed the city to put less money into the city’s ailing retirement system in exchange for larger pensions (SeeSix ex-SD pension Officials Bound Over for Trial ).

According to the North County Times News, the council members voted to repeal a 2002 ordinance that grants sweeping legal defense to past, present and future San Diego City Employees’ Retirement System board members. Instead the board members will get the same breadth of legal defense that all system employees are entitled to under certain circumstances by California law.


When the issue came before the council in April, Councilwoman Donna Frye argued that SDCERS should not be given a “blanket indemnification” that could potentially cost the city millions, according to the newspaper.

San Diego‘s pension system faces a $1.4 billion shortfall that has sparked a two-year federal and state investigation.

In January, four of the former officials and their attorney were charged by a federal jury with wire fraud, mail fraud, and conspiracy to commit wire and mail fraud in a 20-count indictment (See   Five Indicted in San Diego City Pension Case ), but pleaded not guilty on all charges (See Former SD Pension Officials Plead Not Guilty ).

Three of the former officials face federal charges for allegedly conspiring to withhold information on a plan to continue underfunding the pension system, according to the North County Times News.