In Sacramento, Power Can Often Reside Within Families

February 28, 2023 By Laurel Rosenhall 3 Comments

Saga of Mia and Rob Bonta is at once familiar — and jarring

SACRAMENTO — Inside the California Capitol, political power often rests within families.

Seats in the Legislature often pass from parent to child or from husband to wife. Five members of the fabled Calderon family of Los Angeles County — three brothers, a son and current Assemblymember Lisa Calderon, the wife of a former assemblyman — have served in the Legislature. And a few years ago, Assemblymember Blanca Rubio and state Sen. Susan Rubio made history as California’s first set of sister lawmakers.

So the story of Assemblymember Mia Bonta and her husband, Atty. Gen. Rob Bonta, is at once familiar and also jarring.

They are Democrats from the Bay Area city of Alameda. Mia Bonta was elected in 2021 to fill the Assembly seat her husband had held after Rob Bonta was appointed attorney general. The pair have been in the news in recent weeks as reporters questioned whether it was ethical for Assemblymember Bonta to oversee taxpayer funding for the office of Atty. Gen. Bonta. Mia Bonta heads the Assembly budget panel focused on public safety, which had purview over the Department of Justice, which is led by her husband.

Political ethics experts raised concerns about the arrangement, and editorial boards criticized legislative leaders for the apparent conflict of interest. Even Chuck Todd, moderator of NBC News’ “Meet the Press,” weighed in.

“It’s a bad look and it’s only going to reinforce what happens when you have one-party rule,” he said after reporter Ashley Zavala of NBC’s Sacramento affiliate broke the story.

Assemblymember Bonta eventually said she would recuse herself from decisions affecting the Department of Justice. Days later, the separation was made formal when the budget chairman moved oversight of the Department of Justice to a different subcommittee. The immediate conflict appears to have been resolved.

Mia Bonta maintains that her position had been cleared by Assembly ethics officials and that she recused herself to support transparency and stop distractions.

“I definitely note that it’s a thing that needs to be navigated carefully,” she said.

Still, a larger question lingers: Where should public officials who are family members draw the line between their shared interests and their separate responsibilities?

In addition to the many family members who serve together in the Legislature, several state lawmakers have had spouses who work on policy issues that come before the Legislature or serve in local governments that receive state funding.

“I don’t see those situations different from this particular situation,” Mia Bonta said.

The Bontas call themselves partners in life and partners in service. They’ve shared a passion for social justice since they got together as freshmen at Yale. And they’ve used their respective offices to advance some of the same causes.

Last year, Assemblymember Bonta wrote a bill to create an office in the Department of Justice to research policies to curb gun violence. A few months after it stalled in the Legislature, she joined her husband as he announced his department would form the office anyway, but that didn’t spark controversy.

But before Mia Bonta was elected to the Assembly, there was a financial transaction involving the couple that several experts said was legal but unethical. As an Assembly member, Rob Bonta created a nonprofit foundation and solicited donations to it from companies that lobbied the Legislature. He then used the foundation’s money to make a payment to the nonprofit organization that employed his wife.

(He described the $25,000 as a loan in 2020, though tax returns at the time didn’t reflect that.)

It wasn’t the first time Rob Bonta had directed money to Mia Bonta’s employer.

Over several years he donated money from his campaign funds to organizations where she worked, obtaining letters saying the groups would not use the funds for her salary because state law prohibits politicians from using campaign funds for personal benefit. He also asked interest groups to donate to nonprofits where she was employed.

“We’re working on areas of shared passion,” he told me at the time.

After a news story was published about the matter, Rob Bonta stepped down from the board of his foundation and it established new rules prohibiting both members of the couple from making spending decisions and banning donations to organizations that employ either one of them.

And California’s political watchdog agency approved a new rule requiring officials to report their ties to an organization when they ask donors to give money to a group that employs, or is controlled by, the official, their staff or their family members.

“These are relationships with a potential for influence or self-dealing that the public would want to have disclosed,” says a staff report to the commission.

Officials should not direct money to organizations that employ their family members because of the potential for their personal benefit, said Jessica Levinson, a professor at Loyola Law School and former president of the Los Angeles Ethics Commission.

In other cases, she said, defining where to draw the line is not always obvious.

Click here to read the full article in the LA Times

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Ex-Deputy Mayor Accused of Taking Bribes as L.A. City Hall Graft Trial Opens

February 23, 2023 By Michael Finnegan 1 Comment

A federal prosecutor told a jury Tuesday that former Los Angeles Deputy Mayor Raymond Chan was a central player in a sprawling extortion racket that corrupted downtown development projects for years.

In an opening statement at Chan’s criminal trial, Assistant U.S. Atty. Susan Har accused him of playing multiple roles in a shakedown scheme led by Jose Huizar when Huizar served on the City Council.

Chan accepted tens of thousands of dollars in bribes, Har said, while also serving as a go-between who facilitated payoffs by Chinese developers to the councilman.

“They needed one another for the pay-to-play scheme to work,” the prosecutor told the jury.

Huizar used Chan, a Chinese immigrant, to extort the developers, Har said, while Chan got the powerful councilman to shepherd their projects through the city’s byzantine approval process.

Chan’s attorney, Harland Braun, told jurors his client was innocent and urged them to keep an open mind until Chan takes the stand and testifies after prosecutors rest their case.

“You’ll find out that the story the government just gave you is not true,” Braun said.

Defying an order by U.S. District Judge John F. Walter, Braun cast the prosecution as motivated by anti-Chinese bias, an allegation the government denies and Walter has ruled off limits.

“Chinese this, Chinese that,” Braun said, adding a moment later, “Stop using race.”

Walter sustained Har’s objection to Braun’s line of attack. Braun persisted. “It’s not a crime to speak a foreign language,” he told jurors.

Chan, who had been general manager of the city’s buildings department for three years when Mayor Eric Garcetti promoted him to deputy mayor in 2016, is charged with racketeering, bribery, wire fraud and making false statements to the FBI. Chan left his city job in July 2017 and became a consultant to developers.

A challenge for Chan will be to refute the testimony of three witnesses who have pleaded guilty to felonies and admitted their roles in bribe schemes: Chan’s former business partner George Chiang, real estate consultant Morrie Goldman and Huizar’s former aide George Esparza.

Huizar, who has admitted taking more than $1.5 million in bribes, implicated Chan when he pleaded guilty last month to racketeering and tax evasion, but the former councilman is not expected to testify.

Prosecutors plan to play recordings of wiretapped phone calls and other covertly taped conversations between Chan and witnesses who were working with the FBI.

Braun tried to undermine their credibility, telling jurors they “can’t rely on a witness who’s a convicted felon.” Braun singled out Chiang, an admitted bagman, as especially untrustworthy. Chiang says he passed along more than $100,000 in developer bribes to Chan.

“If he’d been a little more with it,” Braun said of his client, “he’d have seen that George Chiang was a crook.”

Braun tried to distinguish Chan from others ensnared in the case, noting that unlike Huizar and Esparza, Chan never accepted casino gambling chips, private jet flights, luxury hotel stays and other favors on more than a dozen lavish Las Vegas holidays funded by a Chinese skyscraper developer.

Braun questioned the strength of prosecution evidence that Chan helped arrange that developer’s $600,000 loan to Huizar to settle a sexual harassment lawsuit that threatened his 2015 run for reelection. When the developer, Shen Zhen New World I, was convicted of bribery and wire fraud in November, the jury found the loan was an illegal payoff.

Har told the jury the case against Chan boils down to a conspiracy “to get money, keep power and avoid the feds.” Chan, she said, took advantage of an influx in Chinese developers pursuing projects during a downtown L.A. real estate boom.

“The defendant saw an opportunity to make himself the indispensable person in the middle,” Har said.

As deputy mayor, Chan became a secret business partner with Chiang, who was hired by an arm of Chinese developer Shenzhen Hazens as a consultant on its proposed Luxe City Center Hotel project near what was then called Staples Center, according to Har.

Click here to read the full article in the LA Times

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Open the Books Exposes the ‘Legalized’ Pay-to-Play Scheme by ‘Newsom Inc.’

February 15, 2023 By Katy Grimes 2 Comments

Newsom’s divisive Covid policies and Jennifer’s films/curricula arguably fueled the youth mental health problem

Open the Books has focused its government transparency and auditing attention on Governor and Mrs. Newsom’s pay-to-play schemes, which have been personally benefitting California’s first couple.

In one report, Open the Books reveal that large corporate campaign contributors gave campaign cash to Gov. Newsom and separately received significantly more in state payments – corporations gave $691,615 in campaign donations and received $1.9 billion in state payments. That’s a very nice return on investment – a $10.6 million investment for a $6.3 billion return.

Another report revealed that Open the Books had to sue and then had to file 442 California Public Record Act requests – one with each state agency – in order to obtain California’s line-by-line spending by state agencies, because California’s Controller, Betty Yee, rejected their sunshine request for state spending, claiming she “couldn’t locate” any of the nearly 50 million bills she paid in 2019.

The recent report in January found California’s First Lady Jennifer Siebel Newsom produces ‘Gender Justice’ films, and then sells them to the state’s public schools:

“Jennifer Siebel Newsom solicited state vendors and the governor’s campaign donors for large gifts to her charity, The Representation Project,” the Globe reported.

Siebel Newsom, through her non-profit The Representation Project, has released four films advocating gender justice. The films are leased for screenings to individuals, corporations, and schools, and come with their own lesson plans.

Open the Books notes that Siebel Newsom’s own companion curriculum allows that kids may need to see a school counselor after being subjected to some of the activities about social privilege, gender, etc.—and that they should be on hand. Aside from COVID lockdowns, this is another perverse layer to creating a problem and then “solving” it with funding for more school counselors!

Even more counterintuitively, Siebel Newsom has recognized that her films and curricula can trigger youth mental health interventions. In fact, the curricula provided for her movie The Mask You Live In warns teachers that the related lessons may lead children to seek the help of mental health providers and that therapists should be on-hand during curriculum activities.

Parents have complained about the pornographic content in Newsom’s films shown to 11-year-olds (such as an animated, upside-down stripper with tape over breasts) and 15-year-olds (nearly naked women being slapped, handcuffed, and brutalized in images taken from porn sites) — to view images, viewer discretion is advised.

Editorials have criticized the activities in Newsom’s film The Great American Lie as “emotionally abusive.” The activities ask students to publicly reveal personal information and force commentary on their relative “privilege” and “oppression.”

Just a little conflict of interest?

Over the weekend Open the Books dropped another chapter in the Newsom’s saga of political grift. This one exposes a “legalized” pay-to-play scheme in California: “the Newsom’s create problems, then ‘solve’ them, and cash checks along the way,” according to Open the Books.

“Since inception, Siebel Newsom’s office has received nearly $4.8 million in directed taxpayer funding. The Office of First Partner has grown from seven employees with a budget of $791,000, to nine employees with a budget of$1,166,000 proposed for 2023-2024.”

Here is what Open the Books found:

In the summer of 2022, Governor Gavin Newsom convinced the state legislature to provide $4.7 billion for K-12 mental health services, which, among other things, funded 10,000 new school counselors.

Gavin Newsom convinced the legislature because Jennifer Siebel Newsom, the wife of the governor, convinced him. The biggest advocate for mental health funding within the K-12 California public schools in the Newsom administration was Mrs. Newsom, according to published accounts.

In fact, Gavin Newsom created The Office of First Partner so his wife could promote her policy agenda using taxpayer money. Since 2019, Siebel Newsom’s been armed with nearly $5 million and nine staffers within her subdivision of the governor’s office.

The Representation Project, that licenses “gender justice” films and curricula to 5,000 schools in all 50 states.

The year Gavin Newsom became governor, the California Board of Education adopted guidance that recommended her films and curriculum be licensed and used in classrooms.

Open the Books summarizes the Newsom’s pay-to-play schemes, as well as the devastating results on children, particularly after “Gov. Newsom’s Covid policies took away nearly every opportunity for kids to interact outside the home:”

Newsom’s divisive Covid policies and Jennifer’s films/curricula arguably fueled the youth mental health problem. However, by addressing it with nearly $5 billion and 10,000 school counselors, the Newsom’s generated a policy win for the governor and a business win for Siebel Newsom and her nonprofit, The Representation Project.

They deeply examine “the $4.8 million ‘Office of the First Partner’ Gavin Newsom established for his wife’s policy work, and how Jennifer Siebel Newsom used her position to impact social and political processes, cashing checks along the way.”

Click here to read the full article in the California Globe

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On Her Way Out of Office, a School Board Member Created a Consulting Firm So The Board Could Hire Her

February 14, 2023 By Kristen Taketa 1 Comment

At a recent board meeting, some parents and district employees questioned why the expenditure — now under review by the Fair Political Practices Commission — was needed at all.

Tamara Otero had governed over the Cajon Valley School Board in East County for 12 years, working closely with the superintendent and his cabinet.

So when a district parent defeated Otero in her run for re-election last year by capturing 62 percent of the vote, Superintendent David Miyashiro and his staff suggested a way to keep her in the 14,800-student district: Hire her as a consultant.

Otero would continue her work in family and community engagement and with the district’s TEDxKids program, World of Work initiative and more — only now she would get paid significantly more than she would have as a board member.

“What we discussed was, well, once she’s off the board, she can be hired as a consultant, and we don’t have to lose that institutional knowledge but also the hard work in a time when every department is understaffed,” Miyashiro told The San Diego Union-Tribune.

On Dec. 9, Otero — still board president at the time under its policy — filed paperwork with the state to form a new consulting company, Alfabet Soup LLC. The document did not include her name.

At a board meeting four days later, minutes after Otero’s successor was sworn in, the newly seated board awarded the firm a $60,000 no-bid, half-year contract, along with more than a dozen other consultant agreements.

But in a district that is no stranger to accusations of conflicts, that contract has drawn allegations of self-dealing and is now under review by the Fair Political Practices Commission. And parents and district employees are questioning whether such an expenditure is needed at all.

The day after the Dec. 13 board meeting, Otero filed another document with the state for her new business. This one included her name.

Three weeks later, Otero’s successor, Anthony Carnevale, said he was reviewing the agenda materials from Dec. 13 and realized one contract was missing: Alfabet Soup. He asked Miyashiro about it and was told the firm belonged to Otero.

Believing the contract was a conflict of interest, Carnevale filed a complaint with the FPPC last month about Otero, alleging a violation of state law. In that complaint, he said that before Otero left the board, she had presided over setting the agenda for that Dec. 13 meeting, where her own firm’s contract would be voted on.

“I would hold the same view that that was improper and self-dealing, even if it wasn’t somebody I competed with,” Carnevale told the Union-Tribune.

Government Code Section 1090, the part of state law that Carnevale believes had been violated, forbids elected bodies from making contracts in which any of their members have a financial interest.

According to the Fair Political Practices Commission, courts have ruled that the law is violated not only when an elected official actually votes to approve such a contract, but also when they participate in “planning, preliminary discussions, compromises (and) drawing of plans.”

Every member of a board is presumed to be involved in the making of all contracts, whether or not a member was personally involved, and that presumption can’t be avoided by having the elected official in question abstain from the contract vote, the commission says.

Whether or not state law were violated or board members knew about Otero’s involvement in the company before voting on its contract, the board may appear to have acted in Otero’s interest rather than the public’s, said John Pelissero, a senior scholar at the Markkula Center for Applied Ethics at Santa Clara University.

“The public could perceive that the board has worked some deal to compensate the outgoing president almost immediately as she leaves the board,” he said. “That kind of a perception … can erode the public’s trust in their ability to look out for the public’s interest, rather than in the interest of a former board member.”

Pelissero said it’s also a problem that board members said they didn’t know Alfabet Soup belonged to Otero.

“Board members should be fully informed before they vote on something, and it’s usually the responsibility of the superintendent or the business manager to inform board members,” Pelissero said. “In this case, it doesn’t sound like everyone was being entirely transparent with other board members, and certainly not with the public, in the way this contract was put together and approved.”

This is not the first time the Cajon Valley school board, which governs an East County district of 14,800 students, including many refugees, has been accused of a conflict involving a company connected to Otero.

In 2019, the board awarded a $655,000 building contract to her son’s company, Otero Construction, while she was the board president. Otero abstained from that vote but did not disclose that it was her son’s company, according to a recording of that board meeting and reporting from East County Magazine. She has denied that there was any conflict.

Last month, Carnevale asked Miyashiro for a special meeting for the board to terminate the Alfabet Soup contract and to evaluate Miyashiro’s conduct regarding the matter, since Miyashiro had not notified the board on Dec. 13 of the connection between Alfabet Soup and Otero.

The Alfabet Soup contract was the last on a 16-item list of agreements to be voted on in one motion, and unlike the others, that contract was not provided to the board, Carnevale said in his complaint. “I found this agenda item to be uniquely opaque compared to the other 15 items on the agenda,” he wrote.

“The board was left in the dark on the matter, and the public was left in the dark on the matter, and the superintendent had knowledge,” Carnevale added in an interview.

That special meeting he requested was held late last month. Several community members criticized the contract during public comments.

Some questioned why the board should pay to hire Otero as a consultant to work on programs, such as TEDxKids and World of Work, that the district had already had for years and for which it already has staff.

“Having her be paid this is absolutely ridiculous,” said Angie Asaro, a Cajon Valley employee of 20 years, at the Jan. 31 meeting. “We the people voted her out. That right there should speak volumes in her not being wanted or needed in our district anymore.”

After public comments, Carnevale asked to confirm whether other board members had known that Alfabet Soup was Otero’s company when they approved its contract. All four said no.

Otero, whose job as board president had been to set the meeting agendas while consulting with the superintendent, said in an interview that she didn’t know the Alfabet Soup contract had been placed on the Dec. 13 agenda and said that staff had generated agenda items, not her.

Later during the Jan. 31 meeting, however, Trustee Jo Alegria said she actually had known Alfabet Soup was Otero’s but had forgotten.

“Looking back on that situation, I realized not only did Tamara did mention it to me, I had forgotten that she did,” Alegria said during the meeting. “I also recall that when Tamara was still on the dais that David Miyashiro had made a comment, a public comment, that Tamara will probably just be hired back to Cajon Valley to help complete the work that she started.”

Otero, current board president Jim Miller, the district’s attorney Dan Shinoff and Miyashiro all hold that the Alfabet Soup contract was neither improper nor illegal. Otero did not vote on the contract, which Shinoff said is “extremely important.”

On Jan. 31, Shinoff argued that Otero was no longer a board member when the contract was put on the Dec. 13 agenda and that she had officially left the board Dec. 8, when the election results were certified.

State law and the board’s policy say members continue in their positions until their successor is sworn in. Carnevale took his oath of office during the Dec. 13 meeting.

After Carnevale pointed that out, Shinoff and Miller said they think that the board policy needs clarification.

Miller, who is also a lawyer, later accused Carnevale of misinterpreting the law concerning when Otero officially left the board. “Reading law and knowing law are two different things,” he said during the meeting.

“There is no conflict of interest per legal counsel on the contract itself,” Miller later told The San Diego Union-Tribune in an email. “This was well vetted and explained by legal counsel for the District.”

Shinoff and Miyashiro also argued that if they did not approve Otero’s no-bid contract, they could appear discriminatory on the basis of “individual affiliation,” according to Shinoff, or age, gender or “former political affiliation,” according to Miyashiro. Miyashiro said in an interview that it would show “prejudice” and “making decisions based on personal feelings.”

In his email, Miller suggested instead that Carnevale may be the one giving appearance of a conflict of interest, because Otero had been his opponent in the election he won.

“He’s making an issue out of a non-issue that seems very personal,” Miyashiro said of Carnevale.

At the most recent meeting, district officials lauded Otero’s work in the family and community engagement department, which she helped create in 2014. They credited her with obtaining grant money and helping to bring home students who had gotten stuck in Afghanistan after the U.S. military’s withdrawal.

Meanwhile, the district would otherwise likely have to spend $180,000 to $200,000 to hire a new employee to do the work Otero was doing, said Michelle Hayes, assistant superintendent of personnel. Officials said the district would not be able to immediately find somebody with Otero’s experience.

“I don’t think there can be any question as to the value that Tamara would add,” Miller said at the meeting.

Click here to read the full article in the SD Union Tribune

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Irvine Won’t Investigate Attempted Bribery of Councilmembers, Waits on FBI

January 27, 2023 By Noah Biesiada Leave a Comment

Irvine leaders narrowly voted against conducting a review of their city’s inner workings amid allegations of attempted bribery of two council members in 2018, opting to wait and see whether an investigation from the FBI sheds any light on the issue. 

Melahat Rafiei, a high-profile Democratic leader and consultant, admitted to attempting to bribe those council members and has remained a regular presence at city hall since news of her crimes came to light last May, according to city manager Oliver Chi. 

Some councilmembers called for an immediate investigation to root out possible corruption, while others pointed to a controversial investigation surrounding the Great Park in 2013 as a rationale for avoiding a city probe.

Questions around potential corruption in Irvine have been circulating since last May, when an FBI affidavit focused on an alleged pay-to-play scheme in Anaheim over the sale of Angel Stadium mentioning that a source known as CW1 attempted to bribe two Irvine City Council members.

In a sworn affidavit released last May, FBI special agent Brian Adkins said former Anaheim Mayor Harry Sidhu tried ramming through the Angel Stadium sale for $1 million in campaign contributions from team officials. 

According to the affidavit, after CW1 was arrested for the attempted bribe, they began cooperating with the federal investigation and wore a wire to meetings with consultants involved in Anaheim’s pay to play scheme.  

The Anaheim land sale fell apart and Sidhu resigned, maintaining he’s done no wrong and hasn’t been publicly charged with a crime.

[Read: Anaheim Mayor Harry Sidhu Resigns After FBI Reveals Anaheim Corruption Probe]

Melahat Rafiei later identified herself to Voice of OC as CW1, but maintained her innocence over the past year until she signed a plea deal last week. 

[Read: OC Democratic Power Broker Admits To Attempted Bribery of Irvine Councilmembers and Attempted Wire Fraud]

She also admitted to the attempted bribery case in her signed plea deal, saying she arranged for $225,000 to go to two Irvine City Council members in 2018, but was not charged for it by prosecutors. 

That shined a spotlight on Rafiei’s past work in Irvine across numerous city council campaigns, most notably for her role in helping elect Farrah Khan as Irvine’s mayor. 

[Read: Consultant’s Controversial Plea Deal Spurs Calls for Irvine City Hall Probe, Puts Spotlight on Mayor]

It also opened questions over who it was she tried to bribe after the U.S. The Attorney’s Office refused to disclose the council members’ identities to the public, saying their names would not be released unless they were charged with a crime. 

[Read: Questions Swirl Over Former Irvine City Councilmembers Discussing Accepting Bribes With Cannabis Lobbyist]

At Tuesday night’s city council meeting, Khan called not to investigate Rafiei’s work, saying she had concerns that any investigation could turn into a politicized attack against herself at taxpayer expense and claiming she cut ties with Rafiei after the news of the arrest broke. 

“If she has had communication with staff, it has been outside my work here,” Khan said. “It’s important for us to seek justice and be sure there is no corruption, but more importantly putting out false information and accusing people falsely is even more dangerous.” 

Councilman Larry Agran agreed, pointing to an investigation of the Great Park that he said cost the city over $2 million, went on for years and was criticized by the state auditor as an improper audit in 2016. 

[Read: Former Great Park Auditor Surrenders Accounting License]

“There is an ongoing public corruption investigation by the FBI, having read that plea bargain and agreement, it’s pretty clear that there was more than just an attempt to solicit a bribe, that somebody was biting on the other end,” Agran said. “They don’t quit. It’s not going to stop here.” 

Councilwoman Kathleen Treseder disagreed, pointing out how it took three years for Rafiei’s arrest by the FBI to become public knowledge and that the city could have questions the FBI fails to answer. 

“I appreciate the FBI does investigate, they’re working on at least certain aspects of the issue, we can’t guarantee they’re working on the issues we care about,” Treseder said. “They have limited person power. They’ve told me this, they would like to investigate much more potential corruption in Orange County but they only have so many agents.” 

Treseder called for an immediate investigation from an outside contractor, with plans to report their progress within a month. 

Anaheim commissioned their own investigation into corruption after the FBI affidavit was released, with investigators pledging they found “great stuff,” last October, but nothing has been released yet. 

[Read: City Hired Investigators Find ‘Great Stuff’ in Anaheim Corruption Probe]

Councilwoman Tammy Kim, another former client of Rafiei’s, said she also wanted an investigation quickly to clear anyone of any perceived wrongdoing.  

“I don’t want to get in the way of what our residents are asking for,” Kim said. “They’re really asking for a level of transparency and really wanting to understand how someone who is not affiliated with the city was able to engage in multiple parts of the city.”

Councilman Mike Carroll was the last council member to speak on the issue, and his answer was simple – wait and see what the FBI does. 

“If we act now, we won’t know what would have happened potentially,” Carroll said. “But if we don’t act…we preserve our ability to consider to do something.” 

Ultimately, the council voted 3-2 to do nothing, with Treseder and Kim voting to move forward with an investigation. 

It remains unclear when Orange County could get its next peek at the FBI’s investigation. 

Click here to read the full article at the Voice of OC

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O.C. Consultant Admits to Fraud

January 22, 2023 By Hannah Fry and Gabriel San Román 1 Comment

After her arrest, Democratic operative aided FBI in Anaheim corruption case.

A California Democratic Party leader who was central to a wide-reaching corruption investigation in Anaheim involving the proposed sale of Angel Stadium has agreed to plead guilty to attempted wire fraud, the U.S. Department of Justice said Thursday.

Melahat Rafiei, 45, previously secretary for the California Democratic Party and a member of the Democratic National Committee, was a well-known political consultant in Orange County.

In late 2019, according to a plea agreement filed in federal court Thursday, Rafiei told a commercial cannabis company owner that she would work to pass a marijuana-related ordinance in Anaheim that would benefit the business, in exchange for a payment of at least $300,000.

What she didn’t tell the client was that she was already working on an ordinance on behalf of other people.

Rafiei also told the client that she would give $200,000 of the payment to the Anaheim Chamber of Commerce and keep only $10,000 for her work. Instead, she intended to keep $100,000, the agreement said.

According to the agreement, Rafiei instructed her client to pay the $300,000 through checks made out to various entities. She planned to deposit the money in accounts she controlled and “transmit a portion of the funds to others.”

Rafiei has agreed to plead guilty to a single count of attempted wire fraud, which carries a maximum sentence of 20 years in prison. She is scheduled to appear in federal court in Santa Ana early next month.

In a statement provided to The Times by her attorney, Rafiei declined to discuss the specifics of the plea agreement.

“I will share my story, in due time,” she said in the statement.

“For now, I will proceed with dignity and humility towards finding peace and clarity in my life.”

The plea deal, she said, will “bring certainty, closure and a path forward.”

After Rafiei was arrested in 2019, she began assisting federal investigators. With her help, the FBI learned that Anaheim was controlled by a “small cadre of individuals,” including former Mayor Harry Sidhu and Todd Ament, the former president and chief executive of the Anaheim Chamber of Commerce.

The mayor was accused in a federal search warrant affidavit in May of divulging confidential information to the Angels during the team’s negotiations with the city over the $320-million sale of Angel Stadium in hopes of receiving a million-dollar campaign donation.

The affidavit also alleged that Sidhu obstructed an Orange County Grand Jury investigation into the deal. Sidhu has not been charged and has denied wrongdoing.

The discovery shook Anaheim’s political establishment, prompting Sidhu’s resignation and leading to criminal charges against Ament.

The FBI accused Ament of plotting with an unnamed political consultant to funnel Chamber of Commerce money into Ament’s personal bank accounts by laundering it through the consultant’s public relations firm.

Ament agreed to plead guilty in June to submitting a false tax return, lying to a mortgage lender and two counts of wire fraud.

The scandal prompted the Anaheim City Council to void the stadium sale.

Rafiei did not plead to any bribery charges, but her agreement with prosecutors also outlines a bribery scheme.

Prosecutors said in the agreement that Rafiei admitted to bribing two Irvine council members in 2018 in exchange for their agreement to introduce and pass an ordinance allowing her clients to open a retail cannabis store in the city.

It is not clear whether the bribes were ultimately accepted by the council members, who are not named in court documents.

In May 2018, Rafiei met with a medical cannabis professional, the person’s business partner and an Irvine council member.

They discussed introducing an ordinance that would legalize retail medical cannabis in the city, according to the plea agreement.

The council member told them they planned to use a separate member of the City Council to introduce the proposed law, the agreement said.

Unbeknownst to Rafiei, the business owner and partner were acting as informants for the FBI.

After the meeting, Rafiei asked the cannabis business owner to pay her between $350,000 and $400,000 for brokering the ordinance.

She told them that the first council member they met with had asked for $200,000 and the second one, who was allegedly going to introduce the ordinance, was seeking about $25,000, according to the plea agreement.

Click here to read the full article in the LA Times

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Ex-LA councilmember Jose Huizar will take plea bargain in corruption case

January 21, 2023 By Olga Grigoryants 1 Comment

Central figure in alleged system of dirty deals at City Hall will admit to racketeering, conspiracy, tax evasion

In a stunning turn in the high-profile corruption saga that has gripped the City of Angels for many months, former Los Angeles City Councilman José Huizar has agreed to plead guilty to racketeering, conspiracy and tax evasion, according to court documents filed Thursday, Jan. 19.

Update: Jose Huizar pleads guilty to racketeering and tax evasion, faces nine years

Huizar’s plea agreement — which maps out his links to a bribery and money-laundering scheme in which he was accused of taking more than $1.5 million in cash, gambling trips and escorts in exchange for supporting a planned downtown hotel project — was signed Wednesday and filed in Los Angeles federal court Thursday afternoon.

The document states that Huizar faces a sentence of up to 26 years behind bars once he pleads guilty, but he has agreed to a prison sentence of no less than nine years. A motions hearing in the case is on calendar for Friday morning, but that could be updated to allow for Huizar to enter his plea.

At his sentencing, Huizar will be ordered to pay restitution of about $1.85 million, the documents state.

Huizar early this month lost his bid for a severance from his co-defendant in their forthcoming trial on federal public corruption charges.

In that ruling, U.S. District Judge John Walter denied the motion for Huizar to be tried separately from former Deputy Mayor Raymond Chan.

There was no word Thursday on whether Chan would also plead guilty.

Huizar faced a courtroom drama on Feb. 21, facing trial for federal bribery and fraud charges. His actions were allegedly intertwined with those of City Hall insider Chan, whose high-profile attorney Harland Braun announced that he would tell the jury Huizar was guilty and Chan was not guilty “by comparing and contrasting their conduct as criminal and noncriminal, respectively.”

Prosecutors said billionaire developer Wei Huang, who fled to China, was accused of giving Huizar $1.5 million, including $250,000 in casino chips and a loan Huizar never paid back.

Huizar was heading for a difficult day in court after Huang’s Chinese real estate company was convicted on Thursday, Nov. 10, of federal charges for bribing Huizar with vast amounts of cash and numerous gambling trips in exchange for his support to get approval for a towering downtown L.A. skyscraper that was never built.

Shen Zhen New World I, the company owned by fugitive developer Huang, faces millions of dollars in fines in its sentencing, which is expected in a Los Angeles federal court on Jan. 23.

A Los Angeles federal jury found Shen Zhen New World I guilty of eight counts including honest services wire fraud, interstate and foreign travel in aid of bribery, and bribery concerning programs receiving federal funds.

Federal prosecutors have convicted nine defendants as a result of “Operation Casino Loyale,” a broad corruption investigation into Los Angeles City Hall by the FBI and the U.S. Attorney’s Office.

A thick trial memo written by federal prosecutors recently unveiled dramatic new fireworks, alleging that Huizar was so entangled with Huang that he traveled with the billionaire Huang to Las Vegas 19 times.

Billionaire Huang planned to build a 77-story tower, the tallest building on the West Coast, on the site of the L.A. Grand Hotel downtown. Federal prosecutors said the company bribed Huizar to smooth the way.

Devastating testimony last fall by Huizar’s estranged wife, Richelle Rios, detailed her suspicion that her husband was involved in an extra-marital affair, and in August 2013 she had learned that Huizar was being sued by a former aide alleging sexual harassment. The woman sought between $600,000 and $1 million to settle with her ex-boss, Rios said.

Richelle Rios testified that because Huizar was about to run for his third and final four-year term on the Los Angeles City Council — and news of the harassment lawsuit could potentially torpedo his campaign — Huizar and his associates were worried.

Rios, who did not face charges, said she was called to a meeting with her husband, and then-Deputy Mayor Chan and billionaire Huang — known in Huizar’s circle as “Chairman Huang.”

The topic of the meeting: How Huang could “help in resolving the lawsuit,” Rios testified.

“They wanted to know if I was going to stay in the marriage and would I stand with (Huizar),” Rios, 53, told the jury.

Click here to read the full article in LA Daily News

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Melahat Rafiei, Who was Central to the FBI’s Anaheim Investigation, Takes Plea Deal

January 20, 2023 By Brooke Staggs Leave a Comment

The former Democratic party leader could face prison time. She hopes her record and FBI cooperation will help.

Melahat Rafiei, who was a cooperating witness for an FBI probe into a massive corruption scandal involving Anaheim and Irvine, said Wednesday evening that she’s agreed to accept a plea deal with the U.S. Attorney’s office on charges of attempted wire fraud.

She could face time in prison, though she said she’s hoping the judge will take into consideration the role she played in uncovering those broader scandals.

“I have made this painful choice by weighing my options, the most important of which was the care and custody of my son… ” Rafiei said in a statement provided to the Register. “I know this option will bring certainty, closure and a path forward.”

Rafiei was secretary for the California Democratic Party, was helping run campaigns for a number of elected officials and was a prominent consultant for the local cannabis industry until May of last year. That’s when news broke that she’d been arrested in 2019 on charges of “theft or bribery” involving federal funds related to a cannabis scheme, and that she later had been assisting the FBI with a related investigation.

That probe led to federal charges against former Anaheim Chamber of Commerce CEO Todd Ament,and the resignation of then Anaheim Mayor Harry Sidhu. At that time, the Anaheim City Council voided a $320 million deal to sell Angel Stadium to a business partnership created by the team’s owner Arte Moreno, as the release of wiretap transcripts appeared to support allegations of a self-described “cabal” of business and political leaders that had been exerting “significant influence” over how the city was run.

As for Rafiei, the FBI states that she had promised two executives at a local cannabis company that she could help get a favorable cannabis ordinance passed in Irvine if they gave her money to bribe two council members. She later denied those allegations, saying in a statement that she “never attempted to improperly influence any elected official.” Those charges were dismissed without prejudice, which meant they could always be filed again later.

After that arrest, Rafiei began cooperating with the FBI to bring them information about possible corruption in Anaheim. She says she accepted a request to cooperate, wearing a wire and delivering evidence that the FBI used to charge Ament and to raise concerns about Sidhu’s actions.

The FBI previously said that they did not believe Rafiei was being fully honest with them, even while she was acting as a witness.

Federal authorities couldn’t immediately be reached Wednesday evening for comment on Rafiei’s plea deal.

But her attorney, Alaleh Kamran, said via email that Rafiei’s plea is not contingent on any conditions and that the government “has made no assurances other than what is included in the plea agreement, which will not be filed under seal.”

Wire fraud can carry a maximum penalty of up to 20 years in prison, or 30 if the victim is a federally insured bank or other financial institution.

“The hope is that the court will take her distinguished career and lack of criminal history into consideration when sentencing her,” Kamran said.

On advice of her attorney, Rafiei said she can’t discuss facts of the case more until it’s fully resolved.

“I will share my story in due time,” she said. “For now, I will proceed with dignity, humility towards finding peace and clarity in my life.”

Click here to read the full article in the OC Register

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Mark Ridley-Thomas lawyers confirm deal with city to reimburse him $364,573

December 22, 2022 By City News Service Leave a Comment

LA City Council had agreed to reinstate his salary while Ridley-Thomas awaits 2023 corruption trial

Attorneys for suspended Los Angeles City Councilmember Mark Ridley-Thomas — who faces federal corruption charges over his actions while serving on the L.A. County Board of Supervisors — have filed court papers confirming a resolution of his lawsuit against the city and City Controller Ron Galperin for suspending his pay and benefits.

The accord comes after the City Council on Dec. 7 voted to reinstate both his salary and benefits and pay Ridley-Thomas a total of $364,573.

“Plaintiff will dismiss his claims after receipt of the settlement payment,” Ridley-Thomas’ lawyers stated in their court papers filed Monday, Dec. 19, with Los Angeles Superior Court Judge Upinder S. Kalra.

A hearing is scheduled Jan. 31 to address why the case should not be dismissed, but that hearing will be canceled if the case is dropped before then.

Galperin suspended Ridley-Thomas’ pay and benefits after the council member was indicted. Ridley-Thomas and former dean of the USC School of Social Work, Marilyn Flynn, are charged in a 20-count indictment that alleges that in a secret deal then-county supervisor Ridley-Thomas agreed to steer county money to USC if the university admitted his son Sebastian Ridley-Thomas to graduate school — with a full-tuition scholarship and a paid professorship.

Flynn pleaded guilty in the corruption case in September.

Ridley-Thomas was suspended from the council in October 2021 after his indictment. His lawsuit filed on July 28 alleged that city controller Galperin acted unilaterally to cut Ridley-Thomas’ pay and did so to help his campaign for state controller. Galperin finished fifth in the field of six.

The council voted 10-1 to approve the settlement with Ridley-Thomas. Councilmember Mitch O’Farrell cast the lone vote in dissent.

In a statement, Galperin said his earlier decision was “in accordance with city law.”

“I acted because my job as controller and the taxpayers’ watchdog required it,” Galperin said.

The settlement includes $254,000 in back pay and $99,500 in attorneys’ fees.

Click here to read the full article in the LA Daily News

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Column: At the DWP, The Pay is Good, the Benefits are Better and the Deals Keep Getting Sweeter

December 5, 2022 By Steve Lopez 1 Comment

More than once over the years, when people have complained about how hard it is to survive in a low-wage economy with such crippling healthcare costs, I’ve recommended they apply for work at the Los Angeles Department of Water and Power.

I was reminded a few days ago, as terms of the new DWP contract were revealed, that this is still solid advice. And there’s more good news: the utility, never far removed from scandal, is hiring.

In a story by Dakota Smith, The Times reported that Mayor Eric Garcetti was backing a handsome pay hike for water and power employees after an 11-0 vote by the Los Angeles City Council.

The highlights:

Roughly 10,000 employees of the all-powerful campaign-donation factory known as Local 18 of the International Brotherhood of Electrical Workers will get raises ranging from 10% to 24% over four years.

All workers will get 3% stocking stuffers as a cash bonus.

On top of those increases, 800 utility workers will get an additional package of raises over the four years ranging from 20% to 41%. In one scenario, some workers’ salaries could rise as much as 74%.

And once again, despite years of promises from Garcetti and others to demand employee healthcare contributions, going to the doctor or hospital will continue to be virtually free for the vast majority of workers.

A Garcetti spokesman said the mayor believes “this contract will put the city in a strong position to maintain and attract a skilled workforce to deliver our most critical city services.”

But this is the same mayor who said in 2013, after defeating IBEW-backed candidate Wendy Greuel, that DWP employees needed to start contributing to their healthcare costs. The mayor then held up a contract deal and did win significant concessions, but he wimped out on demanding healthcare contributions.

The same thing happened in the 2017 contract, when handsome raises were awarded, but the healthcare freebie remained in place. So during the Garcetti reign as mayor, that’s strike one in 2013, strike two in 2017, and now strike three.

“It’s outrageous,” Jamie Court, of Consumer Watchdog, said of the new contract.

“The worst part of this deal,” said former L.A. city official Rick Cole, who is returning to work for newly elected controller Kenneth Mejia, is that other city unions “will want to use it as their benchmark, and the city’s about to hit recession revenue shrink.”

To be fair, healthcare ought to be free or at least more affordable for everyone. But that’s a story for another time.

And I should say that not everyone thinks this new DWP contract is out of line. One reason is the contention that compensation is higher at other utilities, some of which have enticed and poached DWP employees by dangling better offers. That’s what Garcetti was getting at in saying this contract will “maintain and attract a skilled workforce.”

A DWP spokesperson, quoting his bosses, said that of the 150 electrical line workers trained in the last five years, 70 left because “our salaries were not competitive.” The DWP says hundreds of vacancies exist because of hiring difficulties, and that’s driving up overtime costs to maintain operations.

Meanwhile, ratepayer advocate Fred Pickel told me he supports the new contract, based in part on his research into pay packages offered by competing utilities. Pickel said the DWP is top of the heap when it comes to healthcare coverage, but when you factor in pay, pensions and other benefits, the DWP’s standing falls.

In charts Pickel provided, the DWP “falls around the median” in average total compensation at $169,000, well below the high of $230,000 and above the low of $118,000.

In base salary alone, DWP custodians make $60,000, painters make $90,000, steam plant mechanics make $107,000, water utility superintendents make $166,000 and electrical services managers make $228,000.

But all these numbers, which aren’t bad to begin with, will rise with the new contract. And healthcare will still be virtually free, for those who choose Kaiser, or close to it for those who choose other plans.

Given the rising personnel and retiree costs, which will come as the DWP confronts green energy costs that will be in the tens of billions of dollars, you’d think there would have been a robust public vetting of this new contract, which will cost between $55 million and $111.8 million a year.

Skeptics should have had a chance to grill DWP officials and demand specific examples of poaching. They should have been able to ask whether a utility that had a comically egregious overbilling fiasco not long ago and watched a recent corrupt GM get hauled off to prison could be trusted to have competently negotiated the new contract.

Another fair question: How long might it be before ratepayers — who are saddled with both their own healthcare costs as well as those of DWP employees — pay more to turn on their lights and faucets.

But as Smith reported, the City Council — limping along in the wake of the recent racism scandal — opted not to have a public hearing on the new pay package, just like it opted out in 2017. And outgoing Councilmember Paul Koretz, who heads the personnel committee that could have challenged the deal, declined to comment.

“This isn’t about keeping employees for the city,” Court said. “It’s about payback for one of the most connected unions in the city and it’s a going-away gift from politicians who have nothing to lose.”

The IBEW political wing donated in the recent election cycle to Councilmember Curren Price and incoming Councilmembers Traci Park and Tim McOsker. It also pumped more than $1.4 million into a political action committee to support Mayor-elect Karen Bass.

Click here to read the full article at the LA Times

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