DA's Chief of Staff Files Tardy Disclosure Reports With One Fascinating Tidbit

DA Rackauckas and his chief of staff
DA Rackauckas and his chief of staff
OC Weekly photo

The county's long nightmare is over. Susan Kang Schroeder, chief of staff at the Orange County district attorney's office, yesterday filed mandatory economic-disclosure reports for 2010 through 2014. The move came hours after County Counsel Nicholas S. Chrisos recommended the Board of Supervisors order the filings at a June 16 public hearing.

For anyone expecting shocking revelations, here it is: The one person Schroeder reported giving her gifts during the entire five-year period was Supervisor Todd Spitzer, and given that the two despise each other, the $300 in crystal baubles and flowers he gave in 2010 didn't ultimately buy him favors much less relief from his nemesis' potent wrath.

(Both Schroeder and Spitzer want to follow Rackauckas as DA after the now-72-year-old retires at some unknown date.)

As expected, Schroeder revealed what was already public: Michael J. Schroeder, her ex-husband and a former chairman of the California Republican Party, owns two chiropractic insurance-related entities valued at more than $1 million each and earned more than $100,000 annually.

The state's 700 form requires no greater specificity; Schroeder could earn $1 million or $10 million or $50 million, and the precise amount would not appear.

The DA's chief of staff, who officially divorced her husband in 2014 but has kept his last name, also reported that she has no direct financial stakes in the insurance companies.

But beginning in 2013, Schroeder listed herself as president of M3Connection, a music-promotion company she launched with musician Scott Foster. Annual income from the operation is less than $10,000 per year, she reported.

Critics have raised questions about whether Schroeder used county resources to promote her company, and the disclosures are absent any explanation about Facebook photographs that show her taking a ride in billionaire Henry Nicholas' luxury private jet.

Nicholas' flying crib: A horizontal Susan Schroeder
Nicholas' flying crib: A horizontal Susan Schroeder
Photo published on Facebook

Charles H. Bell, Jr.--a Sacramento-based lawyer who is an expert in election law, as well as political reporting regulations and serves as outside counsel to the state GOP--told the Weekly the FPPC allows a disclosure exemption for travel gifts--regardless of the cost--if tied to volunteer work for nonprofit entities; Nicholas runs at least three such organizations. There's no secret Schroeder has volunteered her time to the businessman's charities as a legal consultant.

Bell, whom Schroeder contacted for assistance, vouches for the filings.

"She made a really good faith effort to identify things that needed to be reported," he said. "It was a serious effort to be accurate, and I think we succeeded."

The disclosures avoided a potential ugly showdown with the Board of Supervisors.

On June 10, Chrisos created an agenda item for the supervisors' June 16 meeting that called for ordering Schroeder to file all the missing "Form 700 Statement of Economic Interests" within 30 days or risk $10 per day fines. California's Fair Political Practices Commission (FPPC) has sharper fangs; it can fine up to $5,000 per violation.

County counsel's report also accuses Rackauckas of being more than a year tardy on complying with a requirement that he disclose a list of all OCDA employees who must file the disclosure reports; his previously filings omitted Schroeder as a necessary filer.

"Susan Kang Schroeder assumed the newly created position of chief of staff to the district attorney in early 2010," Chrisos wrote. "Since then, the position has not been included in the DA's exhibits to the County Conflict of Interest Code, even though Ms. Schroeder participates in the making of governmental decisions which may foreseeably have a material financial effect on a financial interest."

On the OCDA website, Schroeder's role in the office is described as high-ranking and influential in Rackauckas' decision making.

In April, Shirley L. Grindle--the county's independent government watchdog for decades--filed a complaint against Rackauckas and Schroeder with the FPPC.

"The question remains: 'Why has the chief of staff position not been added to the list of designated positions prepared by Rackauckas?'" Grindle wrote. "I believe this matter deserves investigation as to the real reasons behind the omission; namely, the close relationship Ms. Schroeder's husband (Michael Schroeder) at the time of her promotion to chief of staff, enjoys with Rackauckas as his campaign chairman. By omitting this position from the list of designated positions in the DA's department, the business interests, investments, property ownership, loans, etc. of both Susan and Mike Schroeder did not have to be disclosed."

Mike Schroeder is the closest, private adviser to the DA.

FPPC officials replied to Grindle's complaint by re-directing her to the Board of Supervisors for initial action.

In April, Tracy Wood, a veteran journalist at the Voice of OC, reported first on Schroeder's PR company and published photos of her on Nicholas' jet.

Follow OC Weekly on Twitter @ocweekly or on Facebook!

Email: rscottmoxley@ocweekly.com. Twitter: @RScottMoxley.


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