By Matt Coker
By R. Scott Moxley
By Charles Lam
By Nick Schou
By Gustavo Arellano
By Gustavo Arellano
By Steve Lowery
By R. Scott Moxley
The Orange County Grand Jury will soon announce if it will indict ex-Assistant Sheriff George Jaramillo on new bribery charges.
Courthouse observers believed indictments were imminent last week but proceedings stalled after Jaramillo unexpectedly announced he wanted to testify for the secret panel. Conventional wisdom holds that it's foolish for the target of a grand jury, which is dominated by prosecutors, to cooperate. On July 13, Jaramillo told the Weekly he was eager to "answer any and all questions" because "I'm innocent."
But five days later, Jaramillo's lawyer, Joseph G. Cavallo, informed the grand jury that his client would not testify. The flip-flop puzzled prosecutors. However, the next day, July 19, Jaramillo, a lawyer as well, and Cavallo were still not in agreement.
"Look, I know people say it's dumb to testify, but I've testified at the grand jury twice before and I wasn't indicted," Jaramillo said. "I want them to hear the truth. I am not afraid."
[The DA's office on July 21 disputed Jaramillo's claim, saying they've never before sought an indictment against him.]
As this story went online, it was unclear who would prevail: Jaramillo or Cavallo.
Last September, Rackauckas arrested Jaramillo and Erica Hill, Jaramillo's sister-in-law, on corruption charges related to their financial ties to CHG Safety Technologies, Inc. CHG allegedly received illegal use of sheriff's department resources from 2000 to 2003 for product demonstrations. Company officials, who funneled illegal campaign contributions to Sheriff Mike Carona, hoped to win a state monopoly for laser technology designed to safely end police pursuits.
To make his case, the DA had planned to prosecute Jaramillo and Hill on an obscure statute related to misuse of public funds. But the complexity—and, according the Jaramillo, the "obvious weakness"—of that strategy became evident during the weeklong April deposition of CHG owner Charles Gabbard. Deputy District Attorney James Laird, a respected veteran who'd been assigned the Jaramillo case, often appeared confused.
In the aftermath, Rackauckas re-evaluated the evidence and decided he had a stronger case by simply charging that Jaramillo accepted $25,000 in bribes from CHG. The new case won't include charges against Hill. Joseph P. Smith, Hill's lawyer, said his client cooperated with the grand jury and received immunity from prosecution.
The DA's deputies have been presenting evidence to the panel for two weeks. Investigators are also delving into new areas related to possible sheriff's department corruption, including allegations of a massive kickback scheme involving a well-known local attorney and bail bonds. The attorney, whom the Weekly declines to identify because no charges have been filed, said "Tony Rackauckas is on a witch hunt to divert attention away from his own incompetence and corruption."
Despite the legal woes, Jaramillo—out of jail on $25,000 bail—appears confident.
"I've done nothing wrong," he said. "Absolutely nothing and I don't think anyone is going to prove otherwise."
For Rackauckas to shift strategies on the eve of a scheduled July 18 preliminary hearing for the old charges proves that he's "abusing his power," said Jaramillo. "This has nothing to do with justice. It's all about destroying me personally with no legal basis."
DA spokeswoman Susan Kang Schroeder said prosecutors have a duty to fight corruption. "Mr. Jaramillo used his public office and county resources for personal profit," said Schroeder. "Nobody forced him to behave this way, so how is it that he can now claim that Tony Rackauckas is behind a big, huge plot to get him? It's crazy."
The longtime best friend, adviser and confidante to Sheriff Carona, Jaramillo was fired in a March 2004 "management restructuring" after the Weekly revealed the then-assistant sheriff had financial ties to CHG. Jaramillo says that his compensation from the company was legal. Cavallo maintains that Rackauckas is part of a conspiracy to block Jaramillo from becoming sheriff. He recenlty told The Orange County Register that Jaramillo is "charming and smart."
However, former Jaramillo colleagues portray him as a clever if arrogant man dominated by personal demons. (See "Internal Affairs: Sheriff and his top deputy planned a dynasty but sex and money got in the way," May 27.)
But it's Jaramillo's finances that attracted FBI attention. For more than a year, agents have investigated Jaramillo's official conduct and relationships with businessmen, including former Assistant Sheriff Don Haidl, who made a fortune selling used government vehicles. The federal probe is also focused on possible diversion of contributions given to law enforcement-related charities.
Jaramillo claims he is unaware of any FBI investigation, "That's news to me," he said.
"George is living in a fantasyland," said one deputy who has been interviewed by detectives. "The question isn't: if he's going to be indicted, but when?"
"If that's true—that I'm going to be indicted, so be it," said Jaramillo. "But remember they will still have to prove their case to a jury. I'm just not worried."