Shirakawa Holds On to Missing Funds, Misses Auditor’s Repayment Deadline

UPDATE: As of the end of business Tuesday, Feb. 19, Supervisor George Shirakawa still had not repaid the misused funds he was ordered to repay by county audits completed in December, according to county officials. The deadline for Shirakawa to reimburse $12,237.09 in charges he made with his county charge card was last Friday, Feb. 15. See below for previously reported details.

George Shirakawa has a reputation for missing important deadlines. It then comes as little surprise that the county supervisor under investigation for his misuse of county funds ignored Friday’s due date to reimburse roughly $12,500 in charges.

Shirakawa also blew off an extension he was given to Monday, according to County Executive Jeff Smith, who said that Eddie Garcia—Shirakawa’s chief of staff—provided an explanation for the supervisor’s failure to return the funds the county wants back.

“We got an email from Eddie saying that George needed to get the check from his accountant and that the accountant was closed on Monday because of the holiday, so he’ll get back to us tomorrow,” Smith said Monday evening.

A December audit of Shirakawa’s county charge card, or P-Card, found that more than half of the $36,837 in purchases he made during his first four years as supervisor violated county rules and regulations. As of Dec. 20, Shirakawa had repaid $7,252.51, with more than half of those reimbursements coming in October—after Metro and San Jose Inside began making Public Records Act requests into his P-Card account in September 2012.

Investigative reports published by Metro and San Jose Inside in September and October revealed that Shirakawa consistently missed campaign disclosure form deadlines and also used his P-Card for trips to casinos, golf outings, plane tickets, expensive dinners and alcohol. The state’s Fair Political Practices Commission and the District Attorney’s office subsequently began separate investigations.

Irene Lui, controller-treasurer for the county, said Friday that Shirakawa’s office informed her that a reimbursement payment would come in today, Feb. 18. Lui did not confirm the exact amount of that money Shirakawa owes the county treasury, but based on records provided by the county counsel’s office, Shirakawa appears to be on the hook for $12,569. This does not include the $29,540 of county funds Shirakawa and his staff were ordered to reimburse for inappropriate payments and charitable contributions in a follow-up audit.

Smith, who has been criticized for his and other department heads’ inadequate oversight of Shirakawa’s private use of tax dollars, acknowledged last week that Shirakawa was not expected to meet the deadline for repayment, and “typically we would start collections the day after” a deadline. That would have been today.

However, Smith doesn’t seem keen on that idea.

“I think this is a little different than a regular debt to the county,” Smith said. “It’s an elected official, so think I need to get the board to weigh on how they’ll proceed.”

Asked whether Shirakawa, who filed for personal bankruptcy in 2011, should be allowed to continue making financial decisions on the county’s behalf, considering his personal and professional behavior shows a pattern of fiscal recklessness, the county’s CEO said: “Well, that’s, as they say, a question above my pay grade.”

Smith makes an annual salary of $310,000. When reminded that he’s the county’s highest-paid employee (other than Valley Medical Center physicians), so the pay grade stops with him, he clarified: “Well, the question of should things happen, that’s really up to the elected (officials). That’s not up to me.”

An interesting detail regarding the manner in which the county is recollecting misused funds is that Shirakawa is getting a free pass on some of his expenditures.

For example, the county has received reimbursements totaling $1,647.18 from people who say they were unaware Shirakawa paid for their food, drinks and lodging with county funds. According to Smith, Shirakawa will be forgiven that part of the debt.

“The county is really just interested in getting county refunds,” Smith said. “Whatever source it comes from is fine in satisfying the need.”

If that’s the case, this would lower Shirakawa’s past-due reimbursement total to $10,921.82. That means people who Shirakawa treated to lunches and dinners with county funds would wind up retroactively paying for their meals.

Former San Jose Police Chief Chris Moore sent the county a check for $400 in November, which covered a portion of a dinner his command staff shared with Shirakawa at the Fairmont’s Grill on the Alley;  Norberto Dueñas sent a check for $33 that same month, covering food and alcoholic beverages Shirakawa bought with his P-Card before making a fraudulent declaration on his missing itemized receipt form that no alcohol was served; San Jose Councilmember Xavier Campos reimbursed the county for $150 to cover 10 different meals, although there were far more when Campos was his policy aide; and former lobbyist colleagues Joe Guerra, Tom Saggau and Dustin DeRollo reimbursed the county with checks of $27.23, $122.45 and $184.09, respectively.

Even San Jose’s acting police chief, Larry Esquivel, who is a close friend of Shirakawa’s, reimbursed the county for $100 on Dec. 12, 2012.

In an interview last week, Esquivel refused to discuss Shirakawa; why they met for meals on three separate occasions, according to Shirakawa’s expense reports; how the meals were paid for at the time and why he decided to write a reimbursement check for $100.

In an article published Saturday by the Mercury News, Esquivel is noted as formerly sharing ownership of property with Shirakawa in San Jose. Shirakawa also managed to suck out the equity of a home he and his siblings inherited from their deceased mother.

While rumors continue to circulate about when the DA and FPPC will complete their investigations, the costs to the county continue to mount. Smith estimated the total expense of auditing, investigating and responding to media requests regarding Shirakawa has grown to “probably more than $400,000.”

Josh Koehn is the managing editor for San Jose Inside and Metro Silicon Valley. Email tips to [email protected] or follow him on Twitter at @Josh_Koehn.

18 Comments

  1. It’s clear that this long, public drama is coming to an end and we’ll watch it play out in short order. Some questions need to be asked, though. Where were the Supervisors on this? Couldn’t they censure him, strip him of committee posts or take away his P-Card? Nope. He’s still walking around with the card in his wallet and all of the privileges of office, plus a 200k salary.
    Will Yeager and Cortese, the South Bay Labor Council proxies on the board, try to appoint another candidate blessed by SBLC, the same organization that gave us Terry Gregory and Supervisor Shirakawa? Notice how quiet Cindy Chavez has been about her buddy George.
    Watch who Yeager/Cortese/Chavez try and stuff into this slot when Shirakawa falls.
    Finally, what kind of organization is Jeff Smith running. The fact that this went on for four years—and is still going on as of this writing—means that the county that just raised our sales tax needs better financial accountability rather than a blank check from taxpayers to continue wasting money.

  2. Jeff Smith is a weasel, but if the matter has to go back to the Board of Supervisors for resolution, it just reinforces the notion that Supervisors are indeed “different from you and me”.

    The message from the Board of Supes should be that the terms and conditions were set, and that the matter should not be treated as a one-off.  It should be business as usual.  If that isn’t the message from the Board of Supes, then these people have tin ears when it comes to politics.

  3. ‘tis an expensive burden to bear the expense of a child who’s grown into adulthood without becoming a responsible adult.  Perhaps he’ll grow with time to accept his responsibilities.

    Perhaps also, his district would be better represented and served by someone other than him, unless political patronage is the primary choice they choose.

    grin

  4. Good friggin’ God… somebody arrest this fool already… he has a fiduciary responsibility as a Supervisor. He can and should be held criminally liable for his actions.

    IF this happened at any company in the valley the person would have been FIRED FIRST and then prosecuted against…

  5. If the general public would have collection procedures started the day after a debt was due and not paid then then Gluttonous George should have them started against him.  Smith’s assertion that elected officials are different is a huge spotlight on the problem here.  Shirakawa believes he is exempt from any and all financial obligations whether they’re treating a friend to lunch (some treat when they are shamed into paying the county back that money months later!) or giving “donations” with money that is not his. 

    His personal financial mess raises even more questions, how is it he took lines of credit and mortgage loans when he was so in debt?  How was he able to “loan” his campaign tens of thousands of dollars (nearly $80K) when he’s flat broke?  Who really owns the supervisor?  He is a puppet on a string who should be removed from office immediately and at the very least censured and barred from voting on financial matters as he has a clear and persistent history of financial misdeeds and illegal actions.

    His parents must be rolling over in their graves.  The shame he brings to their family name is compounded by his continued lack of responsibility and refusal to own up to his obligations to the public.  His chief of staff must be embarrassed to offer those lame excuses as if the public doesn’t see right through it.  Shirakawa has plenty of notice (hell we all saw the notices of when the money was due in repayment) and he waits until a holiday weekend to ask for the check from his accountant? 

    George is probably in Vegas or Tahoe or some other casino trying to let it ride and “win” his repayment. 

    What a colossal loser.

  6. I am very troubled by the complete lack of action by the board of supervisors – especially Mike Wasserman. I really expected him to be more of a watch dog, than a companion dog.

    When you look at what happened on the SJ council when Gonzales stepped in it (stripped of committee assignments, budget frozen, etc.) and compare it to the supes, you see they are completely complicit in this. They let him sit back and continue to be a parasite on government. Remember, each month that goes by with him still on the board he puts $11,917 in his bank account, $2,083 into his county paid deferred comp account, and watches his PERs retirement increase by $300 per year. 

    STOP THE BLEEDING ALREADY!!!!

    How come no one is questioning how all these other government officials “refunded” money to the county that George paid for them? Aren’t their refunds Exhibit A in the case against them fo violating the city, county and/or state illegal gift laws?

    Come On!!

    • Turn off your 300 channels of Direct Tv, leave your Chardonnay in the box.
      Gather your group, call SJI AND NBC11, not KGO 7, nor the Merc, Rally your neighbors and have them do the same.
      And go disrupt their kangaroo court and shame these “leaders” into action.
      You can blog all you like but if there are no knocks at the door, the sheeple remain unshepherded.

      • How many articles must be written, and how much evidence must be collected over how many months or years, before action to remove Supervisor Shirakawa from office is initiated?

        There is an individual problem here – Mr. Shirakawa. There is also a system level problem when a situation like this can fester for so long. Lack of action to correct a problem or lack of oversight by those elected as our stewards makes all of the Board suspect at this point – Mr. Wasserman, Mr. Cortese, Mr. Yeager, Mr. Simitian, what are you doing to address this situation?  Is the CBOS our local version of Dr. Seuss’s Waiting Place – you’re waiting for the DA and FPPC?…. And we’re waiting….

  7. I am a huge believer in due process and the right of innocent until proven guilty. However, when did an elected official achieve a higher status above the average Santa Clara County resident..if Shirakawa has in this case? My answer to this question is simple…I don’t think he is even being treated any differently then the average Joe.

    If an elected official is supposed to be a “moral” upstanding citizen and a role model, then I say lets have everyone follow his example. On every credit application and car loan I shall put my address as Attn: Shirakawa 70 West Hedding, San Jose, CA 95110 and let the creditors stand in line behind those after him. In addition, I will suggest a new law that will order every debt collector treat delinquent individuals the same has Shirakawa… then the world would a fair place!

    It is my goal that everyone be treated the same. I would suggest the above ideas be enacted or he should be suspended of all the rights and privileges of an elected official. Clearly, if Shirakawa can not take care of his personal matters then he shouldn’t be allowed to handle the affairs of the 1.8 million residents of the county.

  8. Enough, Enough, Enough!
    We all agree that there was unwarreted spending here! Others have done as much or more. One being our Mayor.
    What I find so dicusting, is the back biting and slurs, that have been the worst of the whole event.
    Everyone that controls the ink in this Village, is guilty of beating a dead horse.
    That is what is really wrong with this P card bull Shit, in this city and county.
    I’m discusted with the continuous cry baby attitudes, when we know that not many politicals and their cronneys would past muster either.
    George will always be George, and sadly we will always be the snivelling, do nothings that we are!

  9. David S Wall,
      Did I miss something here? You had the encampment closed down? What were your thoughts of where these poor souls, will live?
      Perhaps you can solve that issue as you have solved the others.
      A warm bed, a hot meal, a little love goes a long long way!

  10. David,
    This is a very sad story. When George first ran for Supervisor, I supported him 100%. Now I wish he’d do the honorable thing and step down so his district can be represented by someone who will honor their duty to our community, and not bring shame upon it.

    Our County Board of Supervisors should vote George out as soon as the investigations are done, and find him guilty. To do that now would be unjust. As they say, You are innocent until proven guilty.”

    On another note, I agree with you. Our City should not be giving money to the County until they sort out their lack of oversight procedures and policies, when it comes to spending tax payers money. May be they should hire the IRS! They hunt you down like an animal over a penny owed them! wink

  11. Thanks Mr. Wall specifically for your efforts in getting Camp Chuck Sam shut down and more generally, and importantly, for showing the importance of public involvement.
    There’s a reason why our City and County governments are the ineffective, unresponsive bureaucracies that they are. For too many years the people have been inattentive and apathetic and City Hall and it’s various departments have been allowed to ignore the interests of the people while focusing most of their efforts and our tax dollars in pursuit of their own interest. It’s quite a revelation to see the impact of just one impassioned and articulate citizen showing up in person and effectively shaming city officials and workers into doing their jobs.
    Good on ya’!