EX-EIDC CHIEF CLUFF OKS PLEA BARGAIN, AVOIDS TRIAL.

Byline: Beth Barrett Staff Writer

Former Entertainment Industry Development Corp. President Cody Cluff pleaded no contest Monday to one felony count of embezzling public funds from the agency, which issues permits for television and movie location filming.

Cluff, 45, of Covina agreed to the plea to avoid the risk of a jury trial that could have brought eight years in prison if he had been found guilty of the four original felony counts, defense attorney Mark J. Werksman said.

District Attorney Steve Cooley called the plea a ``huge victory'' for taxpayers, noting that the EIDC, as well as elected city and county officials who served as the agency's board of directors when hundreds of thousands of dollars were misspent, consistently denied that it was a public agency.

``A very important point has been made in terms of public trust and holding officials accountable, and a bright line has been drawn in terms of what is a public entity,'' Cooley said.

The plea - automatically leading to a conviction - should spur elected public officials, including those who sat on the EIDC's board, to return any political contributions they got from the corporation if they haven't already done so, he added.

The agency made at least $167,000 in campaign contributions, including $25,000 to Mayor James Hahn's 2002 anti-secession campaign, which was returned after the scandal broke. Several politicians also returned the money then.

``In our view ... those are illegal for EIDC to make, and they should be returned to the EIDC,'' Cooley said.

The felony plea ``sends a message to people out there who would misspend public funds,' said Deputy District Attorney Max Huntsman, one of the prosecutors in the case.

``We'll get them eventually.''

Transcripts of grand jury hearings that led to Cluff's indictment show that he ran up hundreds of thousands of dollars in expenses between Jan. 1, 1996, and Dec. 31, 2002, while heading the EIDC. The corporation was created in 1995 by merging city and county agencies to expedite issuing permits for location filming.

``In hindsight, he recognizes some of these expenses don't look good,'' Werksman said.

Cluff could not be reached Monday.

The expenses detailed in the transcripts included signing his family up for a $15,000 country club membership and contributing $36,000 in EIDC funds to Covina High School, where his sons played football.

He spent $8,000 on strip clubs and $10,000 on the Pittsburgh, Pa., Film Office, headed by his girlfriend, Dawn Keezer, according to the transcript. Cluff also took trips, including one to a fantasy baseball camp in the Dominican Republic.

Cluff at sentencing will face up to two years in prison, but could receive probation after an evaluation of up to 90 days by the California Department of Corrections. He has agreed to pay $80,000 in restitution by June 21.

Darryl Seif, EIDC's vice president of operations who also was indicted on two felony counts of improperly obtaining city badges, was scheduled to return to court June 9. Seif could not be reached for comment. He has denied any wrongdoing.

Lisa Rawlins, chairwoman of the new EIDC board that is made up of appointees of elected officials, rather than the politicians themselves, said Cluff's plea closes a chapter for the corporation. She said Seif will leave the EIDC ``by mutual agreement'' Friday.

``But EIDC moved on a long time ago.''

Last year, city and county elected officials removed themselves from the board, and it now comprises entertainment and community representatives, as well as others outside government.

Cluff decided over the weekend that the stakes were too high to face a jury trial after Superior Court Judge Larry Fidler in January ruled that the corporation was a quasi-public agency, Werksman said. The EIDC board and a number of elected officials had denied that the nonprofit corporation was a public agency.

City Attorney Rocky Delgadillo, who had contended that the EIDC was a private corporation, said Cooley's investigation ``prompted reform.''

``With that chapter behind us, the city can move on to more important business of keeping Los Angeles the entertainment capital of the world,'' Delgadillo said in a printed statement.

The mayor also believes that the EIDC is moving ahead with some of the recent reforms and wants it to be ``more transparent,'' said Hahn spokeswoman Shannon Murphy.

``Mayor Hahn wants to keep film production in Los Angeles,'' Murphy said.

Cluff remains baffled about why many of the expense items were questioned, but now recognizes that some are ``hard to justify,'' Werksman said.

``He always felt he worked hard to better the film industry and the city of Los Angeles. He feels he's being swept up in a tidal wave of political corruption and corporate corruption scandals.''

City Councilwoman Wendy Greuel, who was briefly on the EIDC board and helped in a transition, said future expenditures will be monitored by a private board and further controlled by EIDC's contracts.

``(The conviction) demonstrated the days of the old EIDC are over,'' Greuel said.

Beth Barrett, [phone]

beth.barrett(at)dailynews.com

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