Chapter 11

San Diego — Is there a cover-up in the works over the strange doings of the city of San Diego's well-connected retirement board? That's the word among some skeptics in the wake of the appointment by Mayor Dick Murphy of Richard Vortmann, the retirement board's vice chairman, to the mayor's so-called "Pension Reform Committee." Vortmann, who runs National Steel and Shipbuilding, is a long-time Murphy friend and campaign fundraiser who has personally given thousands of dollars to the mayor's campaigns. Murphy critics point out that Vortmann was on the mayor's so-called Blue Ribbon Citizens Committee to review the city's finances. That group was created five months after Murphy first proposed it in his first state-of-the-city speech in January 2000, and it didn't issue its final report until February 2002, when it declared that the city's finances and budgetary processes were "fundamentally sound." A year later, the bottom fell out, and it turned out that the Blue Ribbon panel had papered over a long list of the city's money troubles, which subsequently required a sharp round of budget cuts and fee hikes. Two weeks ago Murphy called Vortmann into service again, but he isn't the only member of the new retirement review commission with questionable backgrounds. Local pols point to April Boling, a certified public accountant who also just happens to be Murphy's paid campaign treasurer. She's handled the same duties for city councilman Brian Maienschein, along with Deputy City Attorney Leslie Devaney, who is running for city attorney. Boling is also on the board of the San Diego convention center corporation, and she's currently serving as president of the business-controlled San Diego Taxpayers Association, whose members frequently push for favored projects like a new Chargers stadium. The group also has attacked what it considers to be overgenerous public-employee pensions and benefits. Murphy announced his pension review commission in the wake of huge deficits and losses in the retirement fund and related health-care accounts. Supposed target of the review is the city's pension board, led by San Diego City Employees' Retirement board of trustees president Frederick W. Pierce IV. This summer he mounted an expensive public relations campaign, paid for by the pension fund, which included a large display advertisement in the Union-Tribune assuring readers that his management of the pension board was sound and the fund was solvent. It turns out Pierce himself became personally familiar with bad debts during a career as a real estate investment advisor. Currently employed as a consultant to San Diego State's redevelopment effort, Pierce once worked for Price Waterhouse in Orange County. Back in 1994, Pierce declared bankruptcy, citing his share of debt in a soured La Mesa real estate partnership among his bad debts. That liability was worth more than $400,000. According to his bankruptcy filing, Pierce also defaulted on about $25,000 in credit card debt and a $4200 student loan. His total liabilities were listed as $919,522. Pierce's office said he was in Singapore on vacation and was unavailable for comment.

Stripper's luck A West Virginia strip club controlled by Jack Galardi, father of Cheetahs owner Mike Galardi, has been the scene of an alleged drugging and robbery of a free-spending customer who had recently won $314 million in the state's Powerball lottery. As a result of the charges, the Pink Pony in Cross Lanes, part of Galardi South Enterprises, which runs clubs all across the Deep South, has lost its liquor license, is losing $12,000 a month, and may soon be out of business. The story began on a dark night back in August, when Jack Whittaker pulled into the Pink Pony parking lot off Interstate 64 and entered the club, where he had become a regular. Police charge that 23-year-old club manager Jeffrey Caplinger and an ex-dancer, 24-year-old Misty Arnold, conspired to slip knockout drops into Whittaker's tumbler of Hawaiian Punch. Once he was sedated, the couple went out to his SUV, broke out a window, and took about $545,000 in cash and cashier's checks that he was carrying around with him. Whittaker eventually came to, discovered the theft, and called police. Club employees allegedly tried to cover for Caplinger, but one witness, who told police he had been offered a cut of the loot to keep quiet, later broke his silence. The couple faces up to 18 years in state prison. Meanwhile, Galardi's lawyer, Suzanne Coe, has filed suit to keep the club's liquor license. "We have shootings and all sorts of things happen at other clubs, and nothing ever happens," Coe reportedly said.

-- Matt Potter