San Diego has stopped paying the legal fees of a former city manager charged with securities fraud for his role in the city’s pension scandal.
The City Council last week refused to pay bills for former city manager Michael Uberuaga. The Securities and Exchange Commission in April charged Uberuaga and four other senior former officials with fraud earlier this year for failing to disclose the city’s growing, $1 billion-plus unfunded pension liability to investors in 2002 and 2003 bond deals.
Mayor Jerry Sanders pushed to cut off funding for his legal expenses after charges were filed. The city had previously agreed to pay the bills because they were incurred as part of Uberuaga’s official duties and a city investigation found that he had merely been negligent, not criminal, in failing to disclose the pension liability.
San Diego taxpayers paid more than $500,000 in legal bills for the former city manager before the council stopped paying late last month. City attorney Michael Aguirre had asked the City Council to continue paying the bills.
