Booking photos: George Henry
Jaramillo and Erica Lynne Hill.

Photo's Orange County Weekly

Federal investigators "were asking questions about Carona's activities since he was elected sheriff," Corrado added. Investigators asked Jaramillo specifically about "gifts and monies" Carona had received, the attorney said.

Jaramillo and prosecutors reached the plea agreement some time ago. It was sealed while investigators continued to pursue the case against Carona but is expected to be made public at an arraignment tomorrow, officials said.

Jaramillo and his sister-in-law Erica Lynne Hill were arrested for alleged fraud, misappropriation of government funds and felony conflicts of interest. Both appeared before Orange County Superior Court Judge Marc Kelly for arraignment. Jaramillo, 44, was charged with six felony counts of misappropriating government funds and four misdemeanor counts of conflicts of interest, while Hill, 33, faced three felony counts for misappropriating government funds. Hill and Jaramillo pleaded not guilty to all charges, and their attorney Joseph Smith—a former Orange County deputy district attorney who broke from the office after going to Sacramento to file a conflict-of-interest complaint against his boss, District Attorney Tony Rackauckas. Following Hills grand jury testimony and the DA’s decision to drop the charges against her, Hill thought it was over, that what she said would be sealed and she could get on with her life. Then more news reports come out, and the spotlight was back on her. Hill complained, “I didn’t ask for this. I want it to go away, but I’m very tired of being kicked around.” Hill told the grand jury that Jaramillo—11 years her senior—had begun an “inappropriate” relationship with her when she was around 15 years old. Questioned by Deputy District Attorney Brian Gurwitz, Hill wouldn’t use the word “molestation” but did concede that the “sexual conduct, contact” began before she was an adult

Hill further testified to the grand jury that Sheriff Carona, who at the time was seeking a third term as head of the $500 million-per-year agency. Under oath, she told the grand jury the sheriff pressured her for sex after she asked Carona to hire her husband as a deputy. Hill recalls Carona smiling, flirting and asking, “What’s in it for me?”
According to Hill she watched the sheriff’s men go on the offensive against her. Their remarks prompted her to fire back. In a two-page Sept. 13 letter to California Attorney General Bill Lockyer, the county Board of Supervisors, two local members of Congress and the media, she asked that Carona be held accountable for his conduct. It is also believed she filed a complaint with the FBI. According to sources close to the investigation it is believed that the newly elected California Attorney General and former Govenor Pat Brown is also looking into the whole matter.

On Oct. 5, prosecutors won an indictment against criminal defense attorney Joseph Cavallo. The charges seem to allege that Cavallo masterminded and operated an illegal kickback scheme involving bail bonds and inmates—inside Mike Carona’s Orange County Jail. Cavallo plead not guilty and posted a cash bond of $25,000.

As reported by the OC Weekly “The whole thing stinks,” said Cavallo. “I think the public would be shocked if they knew how things work in Orange County.”

Cavallo who admits he is familiar with the inner workings of local law enforcement thanks to his long relationship with the sheriff and former assistant sheriffs Jaramillo and Don Haidl, Cavallo says the county’s justice system is governed by the whims of the men who run it. He believes Carona played a secret role in District Attorney Tony Rackauckas's charges after he refused to sabotage the Jaramillo defense.

In cop parlance, Cavallo went on to say the sheriff had motive and opportunity.

That fall, Carona, Haidl and Jaramillo conspired to refer legal cases involving sheriff's employees to attorney Cavallo, a third co-conspirator, in exchange for money. Cavallo is not named in the indictment and has not been charged. But is expected to testify at trail.

Joseph Cavallo criminal trial lawyer pleas guilty for bribing bondsmen for clients

Recently Cavallo abruptly pled guilty to capping charges and is also believed to be cooperating with authorities. Sentencing for  criminal defense trial lawyer Cavallo will be Dec. 14. Controversial Cavallo faces up to three years and eight months in prison on criminal counts of so-called attorney capping and paying bail bondsmen to refer clients to his law firm. This stems from a kickback scheme in which Sheriff Carona and bail agents steered business his way.

Orange County DA Tony Rackauckas

In response, Rackauckas claimed his probe began not with Carona but with a complaint from Don Mehr Santa Ana Bail Bondsmen in “early 2003.” It’s unclear why the DA waited almost three years to charge Cavallo. But at a press conference, Rackauckas said he was motivated solely by “strong evidence” from “more than two dozen witnesses.”
 

An indictment would mark a spectacular fall for the 52-year-old sheriff, who only five years ago was widely seen as a rising star in California Republican politics. Carona received widespread attention after he led the search for the killer of a 5-year-old girl, Samantha Runnion, whose kidnapping and murder captivated the nation. In the months after that case, Carona was often mentioned as a possible lieutenant governor candidate on a slate with Arnold Schwarzenegger.

But even as he gained attention in the political realm, Carona was coming under attack from critics who accused him of improper management and ethical lapses.

His conduct had hurt the department's integrity and morale, according to the critics, who

Orange County Sheriff Michael S. Carona pictured to the right in a Newport Beach bar with convicted felon Rick Rizzolo, a Chicago Mafia associate.

 pointed in particular to allegations that he had issued badges and concealed-weapons permits to campaign contributors without background checks or ensuring that they had proper training. Carona denied that the badges were political favors and said his conduct was proper.

Despite attacks on his character and repeated calls for his resignation, Carona was narrowly reelected to a third term as sheriff in 2006. By then, however, state and federal investigations into his conduct had begun at least two years earlier as the Journal reported in 2005.

In August, the state Fair Political Practices Commission agreed to a settlement in which Carona paid a fine of $15,000 for eight incidents in which he had billed his campaign committee for thousands of dollars in non-itemized expenses that he listed only as "loans."

Those charges arose after the Journal reported over two years ago that ORANGE COUNTY SHERIFF AND HIGH RANKING ELECTED OFFICIALS UNDER INVESTIGATION BY THE FEDS AND THE CALIFORNIA ATTORNEY GENERAL. The Times reported last year that Carona had billed his elections committee for an estimated $130,000 in loans from 2001 to 2003 that were actually expenses.

The Times reported in January 2006 that federal officials subpoenaed records from Carona's reserve deputy program and election committee. This followed disclosures that the government had subpoenaed documents from his charitable foundation.

The full scope of the federal investigation remains unknown. But one apparent focus is a scheme outlined in Jaramillo's agreement to charges of tax evasion and mail fraud. Jaramillo's plea could lead to a sentence of as much as 23 years in prison and tens of thousands of dollars in fines. But Corrado said he hoped his client's cooperation would spare him a lengthy sentence.

The 30-page plea agreement describes Jaramillo's involvement with individuals identified as "M.C." and "D.H." Corrado said the initials stand for Carona and former Assistant Sheriff Donald Haidl.

The plea agreement says that beginning in late 1998 or early 1999, Haidl arranged for Jaramillo and Carona to be appointed to the boards of directors of several companies that paid them compensation or honorariums.

In the plea, Jaramillo conceded receiving $7,000 from Charity Funding Services, a firm owned by Haidl's uncle. The plea agreement says Carona also received monthly payments from the charity company, as well as an unspecified amount of cash from Haidl

Carona's defense attorney, H. Dean Steward, did not return  calls made by The Journal. Nor did the sheriff  respond to a request for an interview by the Journal.

Carona's longtime political advisor and attorney, Michael Schroeder, said federal authorities had not questioned the sheriff, nor officially informed him that he was the target of a federal investigation. Schroeder, who was in Amsterdam on business, also said that rumors of the investigation had not distracted Carona from his job

"He's focused on the fires," said Schroeder, who does not represent Carona on criminal matters.

Dean Holloway says he had the unpleasant experience of witnessing his wife answer an April 2002 phone call from the sheriff. The woman says Carona invited her to take a weekend trip to San Francisco. On another occasion, the sheriff reportedly left a voice-mail message for the woman at the couple’s Aliso Viejo home.

Susan Holloway, 31, told the sheriff’s IA officers, “I never invited the calls from Mike Carona and had no intention of calling him back.”

Keller told LA Times reporter Christine Hanley that the accusations were part of a “ridiculously transparent conspiracy” against a “great law-enforcement officer with a spotless record.”

However, Keller hasn’t explained how Holloway benefits from the conspiracy. Holloway has shunned media attention and asked for nothing from the sheriff. But Dean Holloway had a message for Carona. He told the Weekly, “The sheriff needs to leave other men’s wives alone.”

Carona’s efforts to keep a lid on the sex scandal failed in September when the grand jury released the testimony of  Erica Hill—Jaramillo’s sister-in-law. Hill testified in July that the sheriff demanded and received sexual favors from her on four occasions after her husband applied for a job as a deputy. Though Hill can name the location and time of each encounter, Carona flatly says she’s a liar. Hill has proposed that they take lie-detector tests.

“I’m not the only woman the sheriff has cheated with,” Hill told the Weekly. “He’s got to be scared that others will come forward and tell the truth.”

For Related Journal articles click on:

MEDIA ACCOUNT OF THE EXPANDING SHERIFF'S SCANDAL AND INVESTIGATIONS, THE PLAYERS, TIMElINE & ARCHIVES