Court Hearing Friday for Defendants in $6.4 Million Embezzlement Case That Shocked Pasadena

Published : Thursday, March 8, 2018 | 6:19 AM

Three defendants – one the accused ringleader, a former pastor and City employee – will be in court Friday for a pre-trial hearing in one of California’s largest-ever municipal embezzlement cases, one that revealed a complete breakdown of internal controls in the City of Pasadena’s financial transactions at the time and sent shockwaves of angst throughout City Hall.

Former Pasadena Department of Public Works employee Danny R. Wooten, Tyrone Collins and Melody Jenkins are charged in a 60-count felony complaint for arrest warrant, with allegations of embezzlement, conflict of interest and grand theft with excessive taking, in connection with an embezzlement scandal where the three are suspected of stealing more than $6 million from the City of Pasadena over a 10-year period.

Danny R. Wooten. Image from 2014 Facebook page of New Covenant Christian Fellowship in Pomona

The dramatic announcement by then-City Manager Michael J. Beck of the arrest of the trio and the size of their alleged financial crime was made at a riveting City Hall press conference on December 30, 2014.

As a dour-faced Mayor Bill Bogaard watched, Beck told media “the fact that this fraud went on for this many years is not only disappointing, it’s unacceptable.”

“This theft will challenge the public’s trust we have all worked so hard to build,” Beck said in a letter to City employees.
Eleven months later, Beck resigned as Pasadena’s City Manager to assume the position of UCLA’s Administrative Vice Chancellor.

By early January, 2015 the City had begun to overhaul its financial procedures and since then has implemented a new a new system which includes all-new accounting and procurement modules. A CPA firm was hired to complete a comprehensive citywide fraud risk assessment, and departments continue to make recommended changes from this assessment, City officials said Wednesday.

Wooten, 55, was a management analyst with the Public Works Department when the alleged embezzlement scheme came to light after City employees noticed accounting irregularities in May 2014.

Earlier, Wooten had been placed on administrative leave in March, 2014 for an unrelated matter. His alleged criminal financial activity was discovered on his computer hard drive during the following summer after questions were raised in a City Council subcommittee about the fund Wooten managed, according to an insurance claim later filed by the City.

Wooten was then officially terminated on July 25, 2014, but due to reasons unrelated to the embezzlement investigation, city officials explained.

Further investigation by the Los Angeles District Attorney’s Office revealed more than $6 million had been stolen from the City’s coffers through the scheme that Wooten allegedly orchestrated for more than a decade.

Wooten was arrested on December 30, 2014 along with Tyrone Collins, now 59, and Melody Jenkins, 50. They have been in custody ever since.

Wooten is charged with 20 felony counts each of embezzlement by a public or private officer and public officer crime, along with 19 felony counts of conflict of interest. He is being held in lieu of $1.75 million bail.

Collins, who owned Collins Electric, is charged with 10 felony counts each of embezzlement by a public or private officer and public officer crime. Prosecutors allege that Wooten directed more than $2 million to Collins, who was ordered to remain jailed in lieu of $900,000 bail.

Jenkins, who was a temporary city employee, is charged with one felony count each of embezzlement by a public or private officer, public officer crime and grand theft of personal property. Prosecutors allege that Wooten gave more than $40,000 in city funds to Jenkins, whose bail was set at $50,000.

If convicted, Wooten could face up to 28 years in prison. Collins and Jenkins each face 18 years behind bars.

In January 2016, Pasadena officials said the City received a $5 million payment from its insurance carrier to settle a claim filed by the City regarding the embezzlement. The payment represented the maximum amount of money that could be paid on the insurance claim. It was also about 85 percent of the more than $6 million allegedly embezzled by Wooten.

A portion of the settlement money was deposited into the City’s General Fund to offset the cost of investigating the embezzlement; the rest of the money was deposited into the Utility Underground Program fund that was impacted by the theft, City officials said then.

At that time, the City was in the thick of a comprehensive internal financial and personnel audit in an effort to increase oversight for many of its financial processes. A citizen advisory task force in 2015 had recommended several drastic changes to the City’s auditing procedures to prevent a repeat of the scheme.

For over a decade, Wooten allegedly created false invoices for Pasadena’s underground utility program, records of the case showed. A City audit found Wooten had reportedly submitted more than 290 fake invoices, in which Wooten allegedly added digits to the dollar figures on them before claiming payments.

Between 2004 and 2014, Wooten allegedly directed more than $2 million to Collins and gave Jenkins, who served as his personal assistants, more than $40,000 in City funds.

Along with the money that was allegedly directed to Collins and Jenkins, Wooten also is suspected of setting up bank accounts in his name and directing city money to two religious organizations where he was affiliated with, according to the Los Angeles County District Attorney’s Office.

Ricardo Santiago, Public Information Officer at the Los Angeles County District Attorney’s office, said Friday’s hearing starts at 8:30 a.m. at Department 102 of the Clara Shortridge Foltz Criminal Justice Center in downtown Los Angeles.

Santiago said the judge could decide on a date for the start of the formal trial at Friday’s pretrial hearing.

“It’s just getting things ready for a trial,” Santiago said. Deputy District Attorney Bjorn Dodd is prosecuting the case.