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FEDERAL SUBPOENA: SEC Demands Additional Documents From MUSD

By Brian Hews

Hews Media Group-Community News has obtained an onerous and wide-ranging federal subpoena sent from the Unites States Securities and Exchange Commission to the Montebello Unified School District requesting documents related to, among other things, the $100 million “Bond Offering in December 2016.”

The ongoing SEC inquiry was a result of a series of investigative articles published by HMG-CN beginning in 2016.

Jason Lee, SEC Senior Counsel wrote, “the staff of the San Francisco Regional Office of the United States Securities and Exchange Commission is conducting an investigation [into the MUSD].  The enclosed subpoena has been issued to MUSD as part of this investigation.  The subpoena requires MUSD to provide us documents.”

Lee demanded, “any written, printed, or typed matter including interoffice communications, worksheets, financial records, accounting documents, bookkeeping documents, telephone logs, facsimiles, emails, voice mails, tape recordings, notes of meetings, purchase orders, spreadsheets, data compilations that are stored in any medium from which information can be retrieved, obtained, manipulated, or translated.”

Lee’s information demand concerned MUSD, Del Terra Real Estate Services, former MUSD Chief Financial and Operations Officer Cleve Pell, former CBO Ruben Rojas, former Superintendent of Schools Susanna Contreras Smith, and the accounting firm of Vasquez & Company LLP.

“All documents and communications concerning the selection of Del Terra to perform project management and/or construction management services for MUSD including any responsive bid package; all communications discussing, analyzing, and/or assessing a responsive bid; all communications concerning the process used to select the individuals or firms who were ultimately awarded contracts by MUSD; the process used to select any individual or firm to perform services related to MUSD’s municipal securities program.

The letter continued with the SEC investigation demanding information about the employment moves related to Contreras-Smith, Pell, and Ruben Rojas.

In 2016 HMG-CN reported on the meeting when Contreras-Smith and Pell were “placed” on leave. The article cited Rojas as the driver behind the move against Smith and Pell.

 

Montebello School Board Places Superintendent and Chief Financial Operations Officer on Administrative Leave

 

 

“All communications concerning the placement of Susanna Contreras Smith, Cleve Pell, and/or Ruben Rojas on administrative leave; the removal of Susanna Contreras Smith, Cleve Pell, and/or Ruben Rojas from administrative leave; the termination of Susanna Contreras Smith, Cleve Pell, and/or Ruben Rojas from MUSD including any allegations of fraud, unlawful conduct, misconduct, and/or mismanagement; any complaints about their conduct and/or qualifications and any informal or formal investigation relating to three former officials.

The SEC is also investigating possible violations by the financial advisory firms for the Bond related to contributions to MUSD, a member of MUSD’s Board or an MUSD administrator.

The inquiry could be related to Lalo Trujillo and his firm as reported by HMG-CN in 2016.

 

 

HMG-CN Exposé: Montebello Unified Bond Advisor Lalo Trujillo Lied to Board Members During Regular Meeting

 

 

“All documents and communications concerning any instance in which one of the following entities or individuals was solicited to make a financial contribution of any kind including any underwriting firm that marketed its services to MUSD; any financial advisor that marketed its services to MUSD; any other entity that marketed its services to MUSD related to the issuance of municipal securities and any employee, contractor, or agent of the foregoing entities.”

Finally, the subpoena demanded, “any allegations of impropriety and/or unlawful conduct related to MUSD’s municipal securities program committed by any member of MUSD’s administrative staff or Board of Education; any allegations of impropriety and/or unlawful conduct related to MUSD’s finances committed by any member of MUSD’s administrative staff or Board of Education; any concerns identified by Vasquez.”

Lee requested all material be sent to the SEC’s Washington, DC office.

 

SEE SUBPOENA, CLICK HERE

 

 

 

 

 

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