P.R. EXECS DENY THEY REPAID WORKERS FOR CONTRIBUTIONS.

Byline: Beth Barrett Staff Writer

Fleishman-Hillard officials on Wednesday denied allegations by the former head of the public-relations firm's Los Angeles office that executives outside Los Angeles had reimbursed employees for contributions they made to local political campaigns in 2001.

The company, through its lawyer and in recently filed federal court papers, said Doug Dowie, the former general manager in the L.A. office and an ally of former Mayor James Hahn, only raised such concerns with federal officials in March as part of a criminal investigation prior to his June 2 grand jury indictment on conspiracy and other charges involved in alleged overbilling of the city Department of Water and Power.

``The best way to get leniency is to turn on someone else,'' said Mark E. Beck, Fleishman-Hillard's attorney, who said Dowie did not raise such concerns with internal investigators more than a year earlier. ``Mr. Dowie made these allegations for the first time in a meeting with federal authorities in which he sought to limit his potential criminal liability.''

Mike Faber, Dowie's attorney, said his client raised concerns with Fleishman-Hillard executives in the firm's St. Louis headquarters in 2001 after bonuses - which he hadn't asked for - arrived and one employee questioned them.

Faber said Dowie was told there was nothing wrong, and that the checks should be distributed. Fleishman-Hillard officials deny they gave any such instructions, and say there are no memos or other documents to substantiate the claims.

Dowie was fired during an ongoing investigation into allegations of a ``pay-to-play'' scandal at City Hall. He was subsequently indicted on 16 felony counts of overbilling the DWP and other clients, and has pleaded not guilty.

Dowie, who filed a wrongful-termination lawsuit, is seeking to amend the suit to include a claim that he was fired in violation of public policy after a deposition in which the company's chief financial officer, Frederic Rohlfing, said he had suspicions that some of the firm's L.A. employees might have been reimbursed for political contributions - an action that city officials said would violate money-laundering laws.

The company has alleged that Dowie was fired Jan. 5 without severance benefits for mismanagement and failure to comply with company policies. The company in late March also quit paying his attorneys' fees in his criminal case, and in court papers said Dowie was resorting to ``extortion'' as he faced growing financial problems.

Beck, the company's attorney, said Fleishman-Hillard gave hundreds of bonuses to employees worldwide in 2001.

Faber said Dowie didn't tell internal investigators about his concerns because of the way the questions were phrased. He said Dowie perhaps should have been more aggressive in pursuing his concerns in the years prior to expressing them to federal officials.

``He accepted his marching orders,'' Faber said. ``In retrospect, should he have questioned the legality of what his bosses were doing? Perhaps. But at the time, he accepted what they were doing.''

Beth Barrett, [phone]

beth.barrett(at)dailynews.com