The SEC issued a subpoena seeking testimony and documents from the indicted officials in Bell and from a former city attorney, the Los Angeles Times reported Friday. The investigation involves three sales of municipal bonds totaling $70 million.
A state report last month questioned a 2007 bond sale to be used for a municipal sports complex. State Controller John Chiang said the $35 million raised for the purpose "was far in excess of the amount that was needed and thus unnecessarily increased the city's costs of borrowing."
"It is unclear what has been accomplished except for acquiring a site that consists of a dirt lot with a masonry wall around it and a water pumping station in the middle," Chiang said in his report.
Bell's government and finances came under scrutiny in July after the Times reported officials, in a city of fewer than 40,000 people, were being paid what may have been the highest municipal salaries in the country. The police chief was getting a bigger paycheck than his counterpart in Los Angeles.
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