Two top-level financial employees at the Long Beach Convention Center complained in recent years about the potential for public funds to be misused, but they were ignored by their supervisor, according to new accusations in an ongoing employment lawsuit.
Former Finance Director Paul Falzon is suing the convention center’s private operator, ASM Global, alleging he was fired in 2021 for blowing the whistle on over a million dollars in public money he believes was spent without proper oversight, opening the door for potential fraud.
This month, Falzon alleged in court documents that his replacement at the Long Beach Convention & Entertainment Convention Center, Mary Ellen Mitchell, made similar complaints after discovering Falzon’s accusations “had merit.”
According to the lawsuit, Mitchell brought those concerns to the convention center’s general manager Charlie Beirne, “who ignored her” as he had with Falzon. Soon after, the lawsuit says, Mitchell resigned.
When contacted by the Long Beach Post this week, Mitchell said she quit after less than a year on the job because neither her employer nor city officials were acting on her complaints.
“It was very frustrating,” Mitchell said but declined to go into specifics about her concerns, which she said had to do with trying to find proper purchasing records and making sure policies were being followed.
Beirne, who is now general manager of a different ASM property in Florida, did not respond to a message Thursday.
Falzon’s lawsuit is using Mitchell to bolster his core accusation that the city’s top tourism official, Convention & Visitors Bureau CEO and President Steve Goodling, orchestrated his firing as payback for blowing the whistle on unchecked spending at the facility.
Falzon alleges he was targeted after complaining about Goodling improperly tapping into public money to buy extravagant furniture, unnecessary decorations and other trappings the convention center didn’t want or need.
The city of Long Beach owns the convention center but contracts with venue-management company ASM to run operations. As part of the agreement, ASM is granted access to certain pools of public money. Falzon’s accusations center around one such account called the “$5 Parking Fund,” which is fed by a portion of parking revenue at the convention center.
Over the span of five years, at least $604,008 flowed out of the fund to Goodling’s organization and tens of thousands more were spent at a consignment shop in Newport Beach near Goodling’s home, according to public records.
Falzon alleges that’s just a portion of the $1.3 million in public funds he calculated Goodling spent on furniture, lighting fixtures and art including items like giant stuffed animals, crystal chandeliers and a set of Italian leather chairs worth $3,800.
Despite the convention center and city officials agreeing to reimburse Goodling’s organization for such purchases, many of the items were broken, unaccounted for or sitting unused and crammed into storage, according to Falzon.
Falzon alleges ASM had been looking the other way on Goodling’s behavior because of his clout at City Hall, which could help the company secure a new contract to operate the convention center. (ASM signed a new no-bid contract with the city in October.)
Falzon alleges that after he refused to sign off on reimbursements for missing items, Goodling got him fired in October of 2021. He sued ASM and Goodling last year, seeking unspecified damages.
Goodling’s attorneys have argued he was not Falzon’s employer and had no formal role at ASM, so he should not be included in a wrongful termination lawsuit that relied on “meaningless aspersions, grandiosely likening Mr. Goodling to ‘a mafia godfather.’”
A judge agreed to dismiss Goodling from the action last month but allowed Falzon to amend his complaint and include Goodling once again.
A new version of the lawsuit filed this month included the revelations about Mitchell and alleged Goodling had an undue amount of influence over convention center operations.
“Goodling abused his position of power in the workplace,” the lawsuit says. “In one instance, Steve Goodling told a group of ASM employees that he could ‘get everyone in this room fired’ if they did not support Steve Goodling’s management style.”
Goodling has denied wrongdoing. He did not respond to messages from the Long Beach Post Friday. An attorney for ASM previously declined to comment on the litigation and did not respond to messages Friday.
Falzon says that after his complaints were ignored at ASM, he took them to city officials who hired an outside accounting firm to audit the parking fund. As part of that process, the firm interviewed Falzon, Mitchell and other convention center employees, but the process stalled soon after, according to records reviewed by the Long Beach Post.
The firm found that accounting practices for the parking fund were so inadequate that performing a reliable audit would be more costly than originally thought.
City officials decided that the extra cost wasn’t justified, according to Deputy Economic Development Director Johnny Vallejo, who was overseeing the process. Instead, the city tightened controls on future spending and relied on its own review of ASM’s records to conclude there wasn’t any prior misspending.
City officials have also defended the purchases, saying they were part of a marketing strategy to position the convention center as a boutique destination with unique event spaces that have made Long Beach a leader in the industry.
Convention center’s lax record-keeping stymied audit of millions in public funds, firm says