Former Superintendent Arrested For Allegedly Embezzling Public Funds

TORRANCE, CA – Arraignment is scheduled Friday for a former superintendent for the Centinela Valley Union High School District on a dozen felony counts, including embezzlement and misappropriation of public funds. Jose A. Fernandez, 57, was originally scheduled to appear at the Torrance courthouse this morning and say how he pleads in response to six counts of conflict of interest, three counts of misappropriation of public funds, two counts of grand theft and one count of grand theft by embezzlement of public funds. But the District Attorney's Office announced this morning that the arraignment had been pushed back 24 hours.

Fernandez was taken into custody shortly before 9 a.m. Wednesday by personnel from the Los Angeles County District Attorney's Office, according to jail records. School district officials could not be reached for immediate comment on Fernandez's arrest.

Prosecutors – who are asking that Fernandez's bail be set at $495,000 – allege that he manipulated the school board and its policies and procedures and dramatically increased his pay and benefits during his nearly five-year term as the superintendent of the district, which operates a half-dozen schools in Lawndale and Hawthorne.

Fernandez is also accused of unlawfully creating supplemental retirement programs for himself and other school district officials and making last- minute changes to a retirement plan that allowed him to spike his salary to get lucrative retirement benefits.

In 2013, Fernandez's wages for purposes of the retirement plan totaled more than $750,000, nearly $500,000 more than the school district's next highest-paid employee, according to the District Attorney's Office.

The alleged violations were not discovered until after the D.A.'s office was provided with a copy of a Daily Breeze article in February 2014 about the "excessive salary and fringe benefits" received by Fernandez, according to the criminal complaint.

The school district's board subsequently retained an attorney to review Fernandez's employment contract terms for the purposes of renegotiation, and "were not aware" prior to the lawyer's March 2014 presentation that Fernandez had received "substantial financial benefits beyond what had been represented to them at the December 9, 2009, board meeting when Fernandez's employment contract was approved," the criminal complaint alleges.

Fernandez's "frequent concealment from the board of material information largely prevented the board from discovering Fernandez's crimes against the district," the criminal complaint alleges. "For example, by overwhelming the board with the consideration of revisions to approximately 3,000 board bylaws, board policies and administrative regulations in December of 2010, defendant Fernandez succeeded in burying lucrative financial provisions for himself in the alleged revisions."

The complaint alleges that Fernandez "also concealed from the board a supplemental retirement benefit he conferred upon himself in the amount of $294,000 when he failed to submit the plan design and execution agreement to the board for ratification in March of 2010. Fernandez also concealed from the board the fact of his plan to unilaterally increase his calendar year pay in 2013, thereby resulting in substantially enhanced retirement benefits for himself in a separate retirement plan Fernandez caused to be approved by the board on December 11, 2012."

If convicted as charged, Fernandez could face up to 15 years in state prison, according to the District Attorney's Office.

The school district unanimously voted in 2014 to fire Fernandez, but did not specify the reason for the firing, the Daily Breeze reported then.

Then-Daily Breeze staffers Rob Kuznia and Rebecca Kimitch and editor Frank Suraci subsequently won a Pulitzer Prize for local reporting in 2015 for their investigation into the school district and Fernandez's salary. It was the first Pulitzer for the Torrance-based newspaper.

City News Service and Patch staffer Emily Holland contributed to this post; Image via Shutterstock