4 Beaumont City Officials Fined Millions for Embezzling Public Money, Other Corruption Charges

Four city officials who were part of a massive corruption case involving millions of stolen taxpayers’ money submitted guilty pleas and were ordered to pay millions to the city on Tuesday, the Riverside County District Attorney’s Office announced.

None of the four men received prison or jail time, instead being sentenced to periods of probation and electronic monitoring as well as restitution to the city. They include David Dillon, Ernest Egger, William Aylward and Alan Kapanicas — all who are now barred from holding any public office in California for life.

They’re part of a larger group of city officials involved in the scandal, including a former public works director ordered to pay $3 million in restitution to the city and a former police chief still awaiting his preliminary hearing in court.

“The fact that all these pleas also involve more than $11 million in restitution to the city … is significant,” said Riverside County District Attorney Mike Hestrin.

Each of the men sentenced Tuesday admitted to being part of a “widespread scheme” to steal taxpayers’ money devoted to transportation funding, Riverside County prosecutors said in a news release.

When their charges were first announced back in May 2016, prosecutors said their corrupt scheme spanned more than two decades and cost nearly $43 million in taxpayers’ money, the Los Angeles Times reported.

The elaborate network of embezzlement and political corruption involved a cozy relationship between top city officials and a private company — Urban Logic Consulting, a firm founded back in 1993 by some of the former public officials sentenced, The Press-Enterprise reported.

Just two years later, in 1995, Urban Logic gained its first major contract with the city, a $2 million deal to run the city’s sewage treatment plant, the newspaper reported.

On Tuesday, Kapanicas and Aylward admitted to prosecutors they were providing interest free loans to city employees and a private business as part of their scheme embezzling public money, prosecutors said. Kapanicas used to work as the city manager while Aylward was Beaumont’s finance director.

Both men pleaded guilty to one felony count of embezzlement of public funds and one felony count of misappropriation of public funds. They were placed on three years of formal probation and ordered to serve one year of electronic monitoring.

Kapanicas must pay $1 million in restitution to the city while Aylward was ordered to pay $100,000.

Dillon, who used to work as the city’s director of economic development, admitted he directed work for the city to his and Egger’s private company, Urban Logic, prosecutors said. Egger was working as the city’s director of planning at the time.

Both men admitted to having conflicts of interest by running Urban Logic and working for the city simultaneously, as they could direct major city contracts to their own business to profit off taxpayers’ money, prosecutors said. Both pleaded guilty to one felony count of conflict of interest.

Dillon also pleaded guilty to one felony count of embezzlement of public funds. He received three years of formal probation and one year of electronic monitoring. He also must pay $4 million in restitution to the city.

Egger was ordered to pay $3 million in restitution. He also received three years of formal probation along with six months of electronic monitoring.