The arraignments for three former Beaumont city officials were continued Thursday, May 26, to Aug. 19 so all seven defendants in a criminal corruption probe can enter their pleas to charges on the same day.
Riverside County Superior Court Judge Becky Dugan, who previously expressed a desire to at some point get all the defendants in the same courtroom for proceedings, said arraignments for the other four defendants will be continued from various dates in July to the August date.
She also granted a request from attorneys for Joseph Aklufi, former city attorney, to reduce his bail from $1 million to $500,000. He is the only defendant who had not made bail since the defendants were arrested last week. Bail for the other defendants range from $100,000 to $5 million.
Aklufi, 68, of Riverside, faces six counts of embezzlement, far less than the six counts of embezzlement, 24 counts of misappropriation of funds and two counts of conspiracy each faced by Alan Kapanicas, former city manager, 63, of Palm Desert, and William Aylward, the former finance director, 53, of Cherry Valley, who also appeared in court Thursday.
The judge said Aklufi, “may be somewhat less culpable than the others” because less charges are filed against him, and he also has ties to the community. The judge noted the Riverside County District Attorney’s Office, represented at the hearing by Deputy District Attorney Amy Barajas, opposed the bail reduction.
Attorney James Taylor, who represents Aylward, said outside court a recent U.S. Supreme Court decision allows the court to consider the right for a defendant to be represented by an attorney of the defendant’s choice.
Dugan ordered that some assets, including bank accounts, be accessible so certain defendants could post bail and pay allowable legal defense expenses.
After the charges were filed last week, Dugan granted a temporary restraining order sought by the district attorney to keep 14 homes and nearly 70 bank, savings, IRA and investment accounts associated with six of the seven defendants from being transferred, encumbered or disposed, pending a hearing.
The motion for the order is based on a section of the state’s white collar crime law that allows prosecutors to put those assets on hold for possible restitution or payment of fines if there are convictions.
Because accounts for Kapanicas, and his wife, Diana Kapanicas, are commingled, Dugan made a specific order that his wife could draw $4,500 a month for living expenses.
The former city manager’s attorney, Gregory H. Kassel, sought the order, to unfreeze the couple’s Palm Desert home to make it available as collateral for bail and access a bank account for expenses. Diana Kapanicas previously owned a hair salon, worked in real estate and was an employee of General Government Management Services, the company created by the couple that offered consulting services.
The district attorney’s office filed criminal charges earlier this month accusing former Beaumont public officials of misappropriating nearly $43 million from the city, dating back two decades.
David Dillon, 62, of Temecula, former economic development director; Deepak Moorjani,69, of Yorba Linda, former public works director, and Ernest Egger,, 59, of Mendocino, are each charged with six counts of embezzlement and one count of conflict of interest.
Francis “Frank” Coe, 51, of Redlands, is charged with two counts of misappropriation of funds and one count of conspiracy, tied to $45,000 in interest-free loan money investigators allege he received without City Council consent.
District attorney officials have alleged defendants funneled city funds to their private companies and had roles in diverting nearly $32 million from regional transportation mitigation that should have been available for projects.