The Mayor Under Fire : Resignation a Possibility, Key Bradley Ally Hints

One of Tom Bradley’s strongest City Council supporters Monday became the first city lawmaker to acknowledge the possibility of resignation, saying “he should resign� if the furor over the mayor’s relationship with Far East National Bank so weakens his effectiveness that it becomes “damaging to the city.�

The comments of Councilwoman Joan Milke Flores, in response to a reporter’s question, came as City Council support for the mayor appeared to be crumbling after a dramatic council committee hearing. The hearing produced new details of an incident in which Bradley telephoned to ask about city deposits in the bank, which had employed him as an adviser.

While Flores’ comments were the strongest made publicly, other members of the council expressed surprise about a city official’s testimony that the words “per the mayor� had been written underneath a Far East bid for a city bank deposit--then covered over with white typewriter correction fluid.

Council President John Ferraro said “of course� the revelation was damaging to Bradley “to a certain extent . . . he would have been better off if it had not been revealed.�

But Ferraro said discussion of a mayoral resignation is “premature . . . so far I don’t think there is anything serious enough for him to resign.�

Mayor Won’t Comment

Bradley, through an aide, refused immediate comment on the council members’ statements or the committee testimony.

Interviews with city officials--some willing to be quoted, others speaking without attribution--indicated that the three words--�per the mayor�--had magnified Bradley’s political troubles and had intensified demands that he give a full explanation to counter charges that his private financial affairs conflicted with his public duties.

Another strong theme in the interviews was disenchantment with City Atty. James K. Hahn’s investigation of Bradley’s financial affairs, which has been kept under wraps since it began in the early spring.

While Hahn has kept silent, City Administrative Officer Keith Comrie, the city’s top fiscal officer, pursued his own probe, made at the request of Council Finance Committee Chairman Zev Yaroslavsky, who began, and then abandoned, a race against Bradley early this year. Yaroslavsky’s committee heard Monday’s testimony.

Comrie’s investigation, rather than Hahn’s, produced the disclosure of the “white-out� of the words “per the mayor.�

In an interview after the hearing, Flores said Bradley should abandon his position of refusing to talk until the Hahn investigation is completed. And she said Hahn should give the council a progress report on his probe.

Flores said she is “not recommending he resign or consider resigning.� But if, she said, it turns out that Bradley influenced City Treasurer Leonard Rittenberg to deposit money with Far East, “he (Bradley) must assess his position to see if it is so damaging to the city that he should resign.�

She added: “If it can’t be explained any better than it has been explained, it is very damaging,� Flores said.

“He (Bradley) has to start explaining this stuff,� she said. “If he doesn’t, he puts himself in more jeopardy.� Asking for “an open discussion with council members,� Flores said, “those of us who have been supporters of the mayor deserve an explanation.�

Effectiveness Questioned

She said, “If he can’t explain away any of this, he is going to have to assess his effectiveness in running the city.�

As for Hahn and his group of investigators, they “will have to take a look at their own effectiveness,� she said.

Flores’ comments were significant because she has been a strong backer of Bradley during the controversy over his financial affairs. And she has been an even stronger supporter of Hahn, resisting demands that the city attorney be replaced on the investigation by an outside prosecutor.

She is also considered a council moderate, cautious in her statements.

Difficult to Defend

Flores’ demand for more information echoes statements made earlier in the year by some of Bradley’s influential business supporters, who said his silence was making it difficult for them to defend him.

Significantly, Flores has strong ties to business, particularly those engaged in Pacific Rim trade. She represents the harbor area.

Bradley earlier in the year made a brief statement to the council, saying it was a mistake to engage in outside business interests, which included serving on Far East’s board of advisers and on the board of directors of a savings and loan. Both institutions did business with the city.

But he declined to go beyond that brief statement until after Hahn finished his investigation.

Monday, Deputy Mayor Mike Gage said Bradley has fully answered all questions about the Far East matter.

As for the mayor’s future, Gage said, “The office under the mayor’s leadership continues to set forth a policy agenda for the city and those who are the most skeptical will be the most red-faced in the near future when the city attorney has concluded his investigation.�

TRACKING THE BRADLEY INVESTIGATIONS These are among the key developments in the investigation s into Mayor Tom Bradley’s personal finances, campaign funding and allegations of conflicts of interest:

March 24--Mayor Bradley returns $18,000 he had earned last year as an adviser to Far East National Bank.

March 29--Councilman Nate Holden asks for an investigation of Bradley’s role as an adviser to Far East National Bank to determine if it violates the City Charter’s requirements for a “full-time� mayor.

March 31--City Atty. James K. Hahn launches an investigation of Bradley’s ties to Far East National Bank and Valley Federal Savings & Loan Assn. without waiting for City Council approval.

April 21--The city controller’s office begins an audit of the city-financed Task Force for Africa-Los Angeles-Relations, headed by a Bradley business associate, to determine how taxpayer funds have been used.

April 26--Bradley retains an attorney in connection with the probe into his ties to the two banks.

April 29--City documents reveal that Bradley knew the city was doing business with Far East National Bank while he was a paid adviser, contrary to his earlier denials.

May 3--The city attorney’s office turns over to the Securities and Exchange Commission Bradley’s statements of economic interest, which include stock purchases in companies that later became part of a federal investigation of “junk bond king� Michael Milken and the investment firm of Drexel Burnham Lambert.

May 9--City Treasurer Leonard Rittenberg says in an interview that his office has been depositing millions of dollars at below-market interest rates in minority-owned banks under his own informal and unwritten policy.

May 10--Bradley tells the City Council that he made “an error in judgment� in accepting money from Far East.

May 12--Federal documents reveal that Bradley signed an authorization for federal money to be sent to Far East National Bank in 1984, nearly five years before he says he first was made aware that the bank did business with the city.

May 18--It is disclosed that the U.S. attorney’s office in Manhattan has subpoenaed records of Bradley’s financial transactions with Drexel Burnham Lambert.

May 24--Bradley disputes the sworn testimony of political contributor Ira Distenfield that his Administration helped steer a prized contract to Smith Barney, Harris Upham & Co., his biggest political contributor.

May 25--The Justice Department opens preliminary criminal investigations of Bradley and House Majority Whip Tony Coelho (D-Merced) in connection with their financial dealings with Drexel Burnham Lambert.

May 27--Records show that Bradley met in his office with Far East National Bank Chairman Henry Hwang early last year while the mayor was serving as a paid adviser to the bank and Hwang was actively soliciting deposits from the city.

June 6--In a written statement, Bradley further clarifies what he has called his “error in judgment,� vowing never again to accept outside employment of the sort that led to investigations into his conduct.

July 20--A city audit finds that Rittenberg placed $2 million of public money in Far East, which employed Bradley as an adviser, and then sought to cover up the fact that the decision was made without required competitive bids.

July 24--A city auditor discloses that officials in Rittenberg’s office removed Bradley’s name from a document that showed he had instructed them to deposit the $2 million of taxpayers’ money at Far East.

Compiled by Times researcher Cecilia Rasmussen