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The reason for the arrest has not been officially released but it has been alleged that they "mismanaged funds and diverted money for their own use." DeStefano, in particular, was accused of illegally pocketing money from promoters and organizers, totaling upwards of $1.5 million.
In addition to Gerami, DeStefano had ties to the promoters of the controversy-plagued rave known as the Electric Daisy Carnival. In 2010, a 15-year-old girl died after overdosing on ecstasy at EDC when it was held at the Coliseum, and the organizers allegedly paid DeStefano on the side in order to keep the electronic dance events going at the venue. He and Lynch resigned last year when the L.A. Times reported on the alleged misdealings, kickbacks and other financial irregularities that took place during their tenure. Gerami is also surrounded by a cloud of scandal as his Monster Massive event was cancelled in 2011 without refunding money for tickets that had been purchased.
In November 2011, the Coliseum Commission filed a suit for over $1 million dollars against DeStefano and Lynch, which, as detailed by LA Weekly, "accuses the defendants of filing false government claims, breaching fiduciary duty (for Lynch and DeStefano), fraud (for Lynch and DeStefano), unjust enrichment, (for Lynch, DeStefano and his wife), conspiracy to defraud (for Lynch, DeStefano and his wife), having a personal financial interest in government contracts, unfair business practices (for the rave promoters), breach of contract (for the rave promoters, negligence (for the rave promoters) and more."
Though the charges aren't known yet, the D.A.'s office expects indictments to be handed down this week. Sounds like the party's over.