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The second time came Monday, when he was freed from a seemingly endless nightmare that he says has haunted his family and shattered his life. Shih, 44, signed a mediated agreement with the City of Auburn late in the afternoon to settle a personnel dispute stemming from his arrest on May 24, 2006, when he was charged with multiple counts of embezzlement and illegal possession of a concealed weapon.
In a case brimming with overtones of a classic New England witch hunt, Shih spent three nights in Placer County jail on $500,000 bond before being released when Judge Robert McElhany reduced the bail amount to $10,000. And it’s no wonder the bond was slashed—Only in Auburn has obtained a copy of the “Statement of Probable Cause” prepared by the Placer County Sheriff’s office and the basis for Shih’s arrest. Reading like cheap pulp fiction, charges outlined in the document were manufactured entirely from innuendo, groundless speculation and overwrought fears about the potential power this mild-mannered computer geek might possess to commit acts of techno terrorism against the city.
On April 2, more than 10 months after his arrest, all charges against Shih were dropped by the Placer County District Attorney, with Prosecutor Jeff Wilson saying it would not be in the best interest of justice to pursue the charges. This begs the question: Was Shih innocent of the charges or was there simply insufficient evidence to pursue him?
Shih, who one year earlier had been named “Employee of the Year” by the same city administration that sought his incarceration, was on paid administrative leave for 16 months, ending with the mediation settlement. And prior to his arrest, Shih was a sworn reserve Auburn police officer, recruited by no less than retired chief Nick Willick. Hardly the credentials one expects of an alleged felon.
Terms of the agreement were not released, and all parties are prohibited from discussing the deal. Shih refused to talk about any aspect of the settlement, including any payout from the city.
Saying he seeks “closure without prejudice or hostility,” Shih discussed the impact this protracted legal case has had on him personally and professionally in a wide-ranging, exclusive interview. “I need to draw a line, I need to conclude it so I can move on with my life,” he said. “Life is just too short and too precious.”
During some four hours of conversation in two sessions, Shih was resolute in his innocence and in seeking answers and accountability. “If there was any basis to any of the charges brought against me,” he said, “I wouldn’t be sitting here. I’d be in jail.”
In fact, if any of the spectacular threats imagined in the Statement of Probable Cause were accompanied by a shred of credibility, Shih would have qualified for a cell at Guantanamo Bay. This hysterical document portrays Shih as a one-man wrecking crew who had access to “the waste water treatment facility. . .control over the airport computer system and the Auburn police computer system.”
With apparent celestial omnipresence, the Statement of Probable Cause offered this dire warning in seeking Shih’s arrest: “Based on the recent behavior change of Ernest, the city representatives feel that Ernest is aware that he is being investigated and they are very concerned he has planned to corrupt the computer system if confronted.”
Like it comes as shocking news that the city’s IT manager would have access to such networks? Shih described his responsibilities as “everything technology or computer related” including the citywide computer network, telecom network and police and fire radio communications. What is amazing is that virtually no solid evidence was required to launch an expensive and life-alerting investigation that appears to have been precipitated essentially by gossip and petty office politics.
City Manager Bob Richardson was certainly aware of Shih’s role in managing sensitive systems. He was in the approval chain when Shih was promoted from IT coordinator to IT manager in July 2005 after being named the City of Auburn’s Employee of the Year for saving the municipality nearly a quarter of a million dollars in technology costs (along with co-worker Stacey Larson). Richardson was quoted in a published newspaper report saying, “As a team, they have developed a state-of-the-art information-processing system for the city. It spans from newer police communications to full-city communications networks, to one of the best geographic information systems I’ve seen.”
Shih, who holds two advanced degrees—a BS in mechanical engineering from Sacramento State and an MS in computer sciences from National University—was strident about seeking to clear his name. Yet his demeanor during interviews shifted from moments of defiant determination followed by interludes of stoic acceptance that his life has been damaged irreparably and he is essentially powerless to do anything about it.
When asked directly if he did anything that could be construed as illegal, Shih replied: “No, nothing, absolutely nothing. I went beyond the call of duty in my job—this whole thing leaves me dumbfounded.”
He added, “I have trouble accepting that this happened to me. What did I do to these people? There is no answer.”
Review the specific charges and accusations and it is easy to understand why the DA’s office balked at prosecuting Shih:
Charge: Illegal possession of a concealed weapon. During a search of Shih’s office, investigators discovered a .40 caliber Sig Saur semi-automatic handgun in his desk. The fact is Shih had a license to carry a concealed weapon because he was sworn as an Auburn Reserve Police officer. What was never reported at the time of Shih’s arrest was the gun was unloaded. Shih said because he has two small children at home, he kept his sidearm at work. He stored two loaded magazines at home in his garage and brought them to work only when he had a police assignment. Although the weapons charge has been dropped, Shih’s handgun has not been returned to him.
It is important to note that Shih’s service as a reserve officer—a paid position—was unblemished. “I worked for three years as an Auburn reserve police officer and I never took a dime in payment,” he said. “In my mind, being a reserve is volunteer work, and I really had a good time doing it.”
Accusation: Shih planted wireless cameras and listening devices throughout City Hall to spy on co-workers. Several dozen FBI, Department of Justice and Placer County Sheriff investigators electronically swept the building over three days, according to Shih, and came up with absolutely nothing. Regarding the fantasy of his alleged voyeurism, he said, “The charges were drummed up and based on hearsay, yet the city staff and investigators took them as real.”
Accusation: Shih’s outside employment was unauthorized and he logged hours he did not work. When asked by a Channel 10 television reporter about Shih working for an outside agency, City Manager Bob Richardson answered in a televised interview, “We were not aware of that.” According to Shih, his part time employment with U.C. Davis—for whom he worked as a computer consultant about 20 hours per week—was no secret: “Everyone knew I worked for Davis, including my boss, Will Wong.” Shih said he sought approval from his then supervisor, who is the city’s director of community development. Shih insists he truthfully logged all hours he worked for the city, sometimes working from home or on weekends in the office. He resigned from U.C. Davis after his arrest.
Charge: Embezzlement. Shih was accused of double billing the city for expenses, stealing equipment and taking rebates for purchases that should have gone to his employer. This is the most difficult side of the case to report because there is no access to evidence or testimony.
Shih acknowledges only one instance of double billing: “It was purely an administrative error on my part as well as the city’s finance department, and it only amounted to a few hundred dollars.”
Shih says he used his own credit card to expedite the purchasing processes because he had no reliable city-issued card. He said in some cases the city could not get credit or was deemed to be a “slow-pay account.” Shih blamed poor city accounting practices and said he paid for equipment purchases for about a year, often covering costs for months. “It took forever to be reimbursed,” he said, “and approvals required five levels of signatures for payment.”
Shih denies stealing any equipment and says he never took any rebate that should have been paid to the city, a position evidently supported by the Placer County District Attorney’s office which dropped all of the charges.
Ernest Shih may be a free man, yet he says that isn’t nearly enough. “I never got to confront my accusers,” he said. “I would have liked to have faced them in court.”
Exactly who is responsible for highlighting Shih as a threat to the city? Shih, married and the father of two small children, pointed to four of his co-workers.
Stacey Larson, IT specialist and Shih’s only direct report. The Statement of Probable Cause relies on Larson’s testimony for many of the charges and accusations brought against Shih who said “I promoted her from engineering technician and took her under my wing.” With sadness, he added, “She not only wanted my job, she has been doing it for the last 16 months, so maybe that fulfills a dream for her. Did she make accusations? Absolutely. Did she have motive? Absolutely."
Andy Heath, Auburn’s chief financial officer. Said Shih: “He found me to be too smart, and he can’t handle smart people. . .that’s my personal feeling. He’s a micromanager who wanted total control. Maybe he saw me as a threat to his control because he wanted me out—that’s completely obvious.”
Valerie Harris, Auburn’s chief of police. Shih said he butted heads with Harris on a couple of occasions, especially when she wanted to grant volunteers access to city and police computer systems and he balked. She eventually overrode his objection. He pulled no punches and said, “Valerie is evil. She is incompetent and paranoid. She hates anyone who stands up to her, and I believe she wanted to get rid of me. She leveraged her position as police chief to prosecute me. This was an investigation gone wild.”
Bob Richardson, Auburn’s city manager. “Bob is a very smart and powerful politician,” Ernest said, “but he made a horrible decision on my deal. He followed the lead of his department heads when he should have invested more effort to understand what was going on.
He should have done a better job of verifying the charges, especially when it involves a person’s life.”
From Shih’s perspective, his case needs deeper resolution. “Why is there no accountability for the people who accused me? They committed perjury in a sense. . . they lied to the cops and nobody is facing the consequences.” He added, “Those who accused me, those who made the decision to prosecute—they should pay.”
If you have the impression that Shih is a malcontent and an unpopular manager in the city administration, you would be wrong. “Many people support me,” Shih said, “not just my co-workers and staff, but vendors, too.”
In fact, in an extraordinary display of support, numerous former co-workers—including four key managers in city government—have written letters of recommendation for their fallen colleague: Will Wong, director of community development and Shih’s former supervisor; Mark D'Ambrogi, fire chief; Anne M. Cooey, assistant/deputy city clerk; and Lisa Hoffrogge, building official. Also lending support with a recommendation is retired police chief, Nick Willick, who also championed Harris when she was a candidate to replace him upon his retirement.
Shih is perhaps most appreciative of a letter of recommendation written by Dorcas Reilly, a 19-year Auburn city veteran who retired suddenly a few months ago. Reilly is godmother to Shih’s children and before retiring, she was administrative assistant to Bob Richardson.
So what is the net result of the apparent division of attitudes behind closed doors at city hall? “Morale is at an all-time low,” said Shih. “Many people want to leave. And the huge turnover in the Police Department is not just about low wages. . .many officers are unhappy with the work environment.”
Shih says he has suffered mightily on many levels, fighting both bouts of depression and memory loss. “I don’t know when I can fully recover my mental and financial state—it will take many years,” he said.
His personal life has never been more strained. “My marriage and family have been on a roller coaster,” he explained, “but I’ve gotten tremendous backing from not just my wife, Christine, but my friends, family and co-workers. Their support has been my strength through my darkest hour.”
Though Shih says he had hoped to continue his legal battle, it just wasn’t worth the financial and emotional stress. “The city has deep pockets with unlimited taxpayer money,” he said. “It just wouldn’t be a fair fight.”
As a cautionary note, he warned: “If this can happen to Ernest Shih, it can happen to anyone,” he said. “I don’t even have a parking violation, but people will remember me for being arrested.”
Though the Shih family still owns a house in Auburn, they have relocated to a suburb of Sacramento. Their former family home is being rented for now, and Shih said he’ll put it up for sale when the real estate market stabilizes. “Though I always planned to retire here,” he said, “that dream is shattered now.”
So is his life and future. “I’ll never come back to Auburn because it is just too horrific a memory,” he said. “I love the people there, but it is a sad place for me.”
Note: Only in Auburn tipped off the Sacramento Bee to this story, so look for coverage in the October 2 or 3 edition, written by Art Campos. We beat the Auburn Journal to this one, and God knows if they'll ever get it right.
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