Richardson expects to be cleared of accusations, will not resign

2012-05-11T00:20:00Z 2012-11-14T06:21:57Z Richardson expects to be cleared of accusations, will not resignCaleb Warnock - Daily Herald Daily Herald
May 11, 2012 12:20 am  • 

The mayor of Cedar Hills has broken his silence -- sort of.

After a tumultuous week in which he was named in a federal lawsuit over an alleged Ponzi scheme, and the city manager, recorder and zoning official were sacked or resigned, depending on who is telling the story, Mayor Eric Richardson agreed to an email interview with the Daily Herald on Thursday. But he gave few new details in his answers.

A group of residents have begun circulating an email petition asking the mayor to resign. So far, about 50 people have signed, and the group is considering citywide fliers to bring attention to the petition, resident Angela Johnson said.

Former city recorder Kim Holindrake has said she was ousted for political reasons, while former city manager Konrad Hildebrandt has said he resigned voluntarily to save taxpayers the cost of his legal defense over allegations of misuse of city funds. The Daily Herald asked the mayor to explain what happened on the day of the mass resignations last week and detail his role.

Richardson said the three positions were political appointments.

"These people serve at the pleasure of the city council, and in fact, they are required to be re-appointed at certain intervals. They can be removed at any time for cause, or for no cause at all. The city council requested to have an item on the agenda to consider changes to these particular appointments. The city attorney and I met with those three individuals prior to that evening's city council meeting. Each of the individuals chose to resign. The city council ratified their separation agreements."

Hildebrandt, Holindrake and zoning official Brad Kearl "were a large part of the face of Cedar Hills," the mayor said. "I enjoyed my affiliation with each of them. I personally value their years of service and believe each will find much success in their future endeavors. "

Was it coincidence that within hours of the resignations, the U.S. Commodity Futures Trading Commission filed suit in U.S. District Court against the mayor?

"Of course," said Richardson, who said he was not aware the lawsuit was going to happen. "The CFTC issued their press release before providing service. I am reviewing the allegations with legal counsel."

The lawsuit alleges that Richardson and his business partner engaged in a Ponzi scheme, doctored false statements to investors, touted his position as a city council member to help get investment money for his company and misappropriated at least $557,000 for personal use. In his interview, the mayor denied all the allegations but did not expound on the lawsuit.

In October 2010, Richardson told the Daily Herald he has a "clear conscience" regarding all the accusations, and said they would be proved false. At that time his partner had been arrested for this and other fraudulent activities; Richardson has never faced criminal charges and still is facing only a civil lawsuit.

He plans to stay in his position as mayor, he said.

"Anyone can allege anything they want against anyone. We figure out whether those things are true or not in the legal system," Richardson said.

No one on the city council has asked him to resign, he said.

"The decision to run for office is deeply personal," he said. "The decision when to no longer be in office is also deeply personal. Only [the Daily Herald] and Ken Cromar have asked me to resign." Ken Cromar is one of the founders of a citizens group that has been vocal in their discontent about how the city has spent money on the golf course.

Caleb Warnock can be reached at cwarnock@heraldextra.com.

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