FBI Questioned SEDC Board Members

Published: Wednesday, September 3, 2008 1:46 PM PDT

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Two members of the board of directors of the Southeastern Economic Development Corp. said they have recently been questioned by agents from the Federal Bureau of Investigation about the actions of the SEDC board.

Board member D. Cruz Gonzalez said he was visited by two FBI agents early in the morning about three weeks ago. The agents questioned him for about 1 hour and 45 minutes about the actions of the SEDC board, Gonzalez said.

"They were asking me about Carolyn Smith's bonuses," Gonzalez said. "They said they had read the papers and that they had some questions. They were very professional."

Smith was fired by the board in July after a voiceofsandiego.org investigation revealed that she had approved more than $1 million dollars in bonuses for herself and her staff over the course of the last five years. The bonuses were not approved by SEDC's board or the City Council.

Gonzalez said he told the agents he had not been asked to approve Smith's bonuses.

"Heck, I didn't even know how much she got paid until I read it in your stories," he told me.

Gonzalez said the agents also asked him some questions about the business dealings of Artie M. "Chip" Owen, who until yesterday served as the SEDC board chairman. Owen has come under scrutiny for his ongoing business ties to a developer, Pacific Development Partners, which was recently awarded a development deal with the agency.

Owen has reported receiving between $10,000 and $100,000 a year from PDP since 2004. In July, City Attorney Mike Aguirre opined that Owen's relationship with the company constituted a conflict of interests while he remained on the SEDC board. Aguirre declared the deal with PDP to build out the Valencia Business Park null and void.

Rich Geisler is the other board member who has been contacted by the FBI. He said he had a phone conversation with an FBI agent recently, but said he couldn't really recall the specifics of the conversation.

"It was just, generally, what's been going on," Geisler said, "which way do the board votes go, that sort of thing. It was pretty vanilla."

Geisler said he has had no contact with the FBI since that one phone call; Gonzalez said he received a follow-up phone call about a week ago from one of the agents who questioned him. The agent wanted clarification of certain details, Gonzalez said.