Party Favors

While victims cried, the DAs office aided super Republicans Eddie and Jo Ellen Allen in a multimillion-dollar scamfest

The scam wouldn't have been so successful if Orange County justice officials had paid attention. Before Allen convinced others to invest in his then seemingly legitimate businesses, Illingworth filed a detailed, two-page complaint with the DA on May 28, 1997. He wrote, "I am asking you to stop this man before he destroys any more innocent people by defrauding them of their rightful monies."

The DA—who has prosecuted scam artists who've cheated fewer people for less money than Allen—was not moved. In July 1997, prosecutors sent Illingworth a brief letter claiming they did not have the investigative powers to review Allen's conduct. They killed the complaint. Federal court records show that more than a dozen more individuals would become victims in Allen's schemes.

Jo Ellen—who, as a Republican commentator on KOCE's Real Orange, routinely questions the ethics of her ideological opponents—has confidently cited the DA's inaction as evidence that her husband is innocent.

That spin frustrates Allen's ex-investors and -employees. Gerald Nowotny, one of Eddie's former associates, told law enforcement that Eddie had an accomplice: his wife.

"I would like to bring a serious crime to your attention involving fraudulent conversion of over $3 million of investors' funds in several different state jurisdictions," Nowotny told the DA in July 1997. "Eddie Allen has heavily relied upon the credibility and assistance of his wife—Jo Ellen Allen of the Orange County Republican Party and a [Governor Pete Wilson-appointed] member of the California Bar Association board of governors—to create the aura of credibility necessary to gain the trust and confidence of investors. We have significant documentation that demonstrates that Eddie has operated a Ponzi scheme."

Prosecutors responded with a perfunctory letter refusing to follow up on Nowotny's offer to document the scam.

The DA's inaction may have emboldened the Allens. According to court testimony, Eddie once told angry investors he was immune from prosecution.

"The law can't touch me, and if it will make you feel any better, go ahead and sue me," he reportedly said. "Then you will really see how influential and powerful I really am."

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