City of Pasadena Former Employees Allegedly Embezzled Over $6 million From City

Update 1/2/15: Special Meeting to be held.

Several city employees involved in scheme, including six placed on “administrative leave” according to City Manager Michael Beck, who he refused to identify. Why?  I would imagine that this scheme ran deeper and as Councilman Torneck said City Hall has a “long-standing culture of complacency”.

This complacency in the city is unacceptable, all departments need extensive audits.  All city residents and tax payers should be demanding a full accounting of all departments, especially those with the larger budgets like Public Works and Water and Power.

City of Pasadena Officials have published KPMG’s full audit as of Tuesday on the city’s website.

Pasadena City Manager Michael J. Beck held a press conference announcing the arrest of a former city employee for allegedly bilking the city out of $6.4 million.  So far 3 have been arrested and four are on administrative leave, the identity of those on administrative leave has not been disclosed.

The City of Pasadena is providing a variety of documents and information to help keep the public informed about the arrest of a former City employee regarding the theft of public funds and steps that the City has-and will-take. The following links to documents are being provided.  As more information becomes available, additional postings to this webpage will occur.

Watch some short video clips from the press conference held Dec 30, 2014.

Danny R Wooten, served as “pastor” at Newco – New Covenant Christian Fellowship Center, you can see several “sermons” conducted by Mr Wooten.

Sunday Service Clip: What Kinda of Church We Got Going On?
Message: When You Pour, Make Mine A Double
Pastor Danny R. Wooten

Video on Facebook

Topic: What God has for me is for me and what God has for you is for you
Speaker: Pastor Danny R. Wooten

Video on Facebook

City of Pasadena’s Official News Release

City Manager’s Letter to Employees

Letter to City from District Attorney’s Office

KPMG Audit Report

LA District Attorney’s Press Release

Those charged and arrested thus far:

Danny R. Wooten, 51

Danny R Wooten with New Covenant Christian Fellowship Center – Est 2007

Tyrone Collins, 55

and Melody Jenkins, 46

Danny Wooten was a Management Analyst IV in the city’s Public Works department and earned $131,621.87 in 2013 according to www.transparentcalifornia.com.  Wooten worked for the city for 12 years with the suspected criminal activity spanning over 10 years, between 2004 and March 2014

This from City of Pasadena Council Person

Margaret McAustin – District 2

City Employee Arrested for Embezzlement

Dear District Two Residents:

This is a sad day in Pasadena’s history. Today a former City employee was arrested for allegedly embezzling $6,432,810.98 over a period of eleven years from you and me, the residents of Pasadena.

I want to give you some background about this theft, and make you aware of a Special Meeting the City Council will be holding to discuss the issue and respond to the public.

Like many frauds and embezzlements, this was uncovered through a routine inquiry. Last May, the Municipal Services Committee was looking into the Underground Utility  Program  which is funded through a special tax (UUT), and places overhead utilities underground throughout the City. (The work on Hill Avenue is being funded by this program.) The Committee learned it would take around 150 years to place all the utilities underground and the Committee was evaluating whether this program should continue, or could perhaps be brought to a close at a logical point, and the UUT tax discontinued. It was through that discussion that a “Miscellaneous” account with a high balance was brought into question, and as staff investigated to respond to the Committee’s inquiries, the fraud was discovered.

Subsequently, the City Manager engaged KPMG, a company that specializes in forensic accounting. After investigating, KPMG determined an employee, Danny Wooten, had prepared and provided as many as 296 fraudulent invoices to the City on behalf of four entities with which he was affiliated and received checks totaling over $6.4 million in payment of those invoices. Mr. Wooten, who had already been terminated by the City for an unrelated matter, was arrested today and will be prosecuted by the Los Angeles County District Attorney’s office. While investigators do not believe others were involved, four employees have been placed on administrative leave pending further investigation.

The reported prepared by KPMG lays out very clearly how this embezzlement occurred and what Red Flags should have drawn attention to the embezzlement. That report will be put on the City’s Web page for every resident in Pasadena to examine. It is the City’s intent to put all information about this scandal out to the public as soon as possible. In addition, the City Council will hold a public meeting on Monday, January 5, 2015 solely on this issue.

I want to restore your trust in our Municipal Government. I will answer every question you have, and make every piece of information I have on the matter available to you. For more information you may go to www.cityofpasadena.net/invoiceinvestigation. You are always welcome to contact me directly on my cell phone 626 808 6158 or via the City Council Office number, 626 744-4742.

Margaret McAustin