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Conflict-of-interest charges against pension board members dismissed

District Attorney Bonnie Dumanis on Wednesday dismissed conflict-of-interest charges against six former San Diego pension board members.

Onetime San Diego City Employees’ Retirement System board members Cathy Lexin, Mary Vattimo, Teresa Webster, Sharon Wilkinson, John Torres and Ronald Saathoff were charged by the District Attorney’s Office in 2005 with violating government code 1090, which prohibits public officials from negotiating a contract in which they have a financial interest.

“When we filed this case five years ago, we believed it was important to stand up for the common-sense position that it’s wrong for a pension board trustee to agree to an illegal underfunding of the pension system in return for the promise of increased retirement benefits for all active employees, including themselves,” Dumanis said.

“We continue to believe such behavior constitutes a conflict of interest that undermines the faith the public places in its officials,” Dumanis said. “However, after years of litigation in the appellate courts, and eight years after the alleged conduct, it is time for this case to conclude.”

The state Supreme Court in January dismissed felony conflict-of-interest charges against five of the former pension board members, but ruled that the trial of Saathoff, the former firefighters union president, could proceed.

In the statement, the District Attorney’s Office said the Supreme Court’s ruling stopped it from proceeding with its case against five defendants and substantially undermined the case against Saathoff.

The charges stemmed from a decision in 2002 that permitted the city to contribute less into the pension system, while at the same time increasing retirement benefits.

The District Attorney’s Office argued that the agreement violated the state’s conflict-of-interest law because those who approved the deal stood to gain from it.