Anaheim independent investigation talks of conspiracy, Brown Act violations

A highly anticipated investigation into alleged corruption in Anaheim detailed dealings by a mayor and his allies who went unchecked, money that appeared funneled to the Anaheim Chamber of Commerce and Visit Anaheim and instances of potential Brown Act violations in a 353-page report released Monday.

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The $1.5 million probe, which was ordered by the City Council, followed the 2022 revelation of FBI investigations into former Mayor Harry Sidhu and former Anaheim Chamber of Commerce Executive Director Todd Ament, which included allegations a self-described “cabal” of business and political leaders had exerted significant influence in Anaheim City Hall. Sidhu resigned and the City Council canceled the sale of Angel Stadium.

The report by the JL Group accused Sidhu and Ament of “influence peddling” and describes a close relationship between the city and the Anaheim Chamber of Commerce, saying that it appeared “as if the city was merely subsidizing the Anaheim Chamber with infusions of money on a near-yearly basis.”

While the version of the report by the JL Group made public has several redactions, the city shared a complete copy with the Orange County District Attorney, California Attorney General Rob Bonta and the FBI, officials have said. Anaheim councilmembers also received an unredacted copy on Monday.

The city-commissioned investigators also explored ties to Visit Anaheim, alleging in their report Sidhu directed that $6.5 million in “grant” funds during the early days of the coronavirus pandemic shutdowns be given to the tourism bureau and when City Manager Chris Zapata suggested the city should be paid back the money with interest, Sidhu orchestrated Zapata’s firing.

Zapata is now the city manager for Sausalito.

The purpose of the money was to fund services promoting the city’s reopening during the pandemic, but the contract was “vague and lacked oversight.”

Sidhu then directed CEO and President of Visit Anaheim Jay Burress to divert $1.5 million of that money to the chamber, investigators said. Sidhu directed Burress to cover his story, if ever questioned about the money, by saying it came from other reserve funds from Visit Anaheim, investigators said, calling the diversion “unlawful.”

Investigators could not determine how the chamber used the $1.5 million. The chamber did not cooperate or provide any documents, investigators said.

Sidhu, Ament and Burress did not immediately respond to requests for comment.

Anaheim city spokesperson Mike Lyster said in a statement that the city has begun reviewing the report and will continue to do so in the coming days.

“The report is part of a process with constructive insights welcomed,” Lyster said. “We will also look to any direction from our City Council.”

Orange County District Attorney Todd Spitzer also was taking a magnifying glass to the report.

“I am reviewing with my team to evaluate it for potential criminal conduct and I have no time frame at this time on any decisions,” Spitzer said.

Beginning last September, investigators from the JL Group collected nearly a million emails, more than 50,000 documents and conducted more than 150 interviews. The investigation took more time and money than expected, and at one point even caused the City Council to consider ending it prematurely.

The city-funded investigation was tasked with examining questions of corruption, past campaign contributions, contracts, city dealings, including the sale of Angel Stadium, council decisions and potential Brown Act violations, among other raised concerns.

The JL Group is a Laguna Niguel-based workplace consulting firm composed of former law enforcement  officials.

Investigators noted in their report that the Walt Disney Company and Angels Baseball declined repeated requests for interviews or to participate.

While Disney is mentioned throughout the report, the JL Group did not make any accusations against the company.

The JL Group submitted written questions to Carrie Nocella, the Disneyland Resort director of external affairs, but her attorney declined to have her respond.

Former councilman Jose Moreno, who long has complained about outside influences on City Hall, criticized those who refused to speak to investigators.

“Choosing not to say anything says a lot,” Moreno said.

“It was deliberate, it was organized and it was a syndicate,” Moreno said, adding that taxpayer money was doled out by this cabal “like it was a rummage sale.”

JL Group investigators argued elected officials in recent years have sidestepped the city manager and given orders to city staff directly, especially Sidhu, which violates the city’s charter.

Sidhu would give key staff members direction and strongly suggest a course of action, it said. The report also criticized current Councilmember Natalie Rubalcava for directing a city staffer to work with the Orange County Business Council, for which she previously worked.

The JL Group and City Manager James Vanderpool said Rubalcava’s action would be a violation of the city’s charter. Rubalcava did not immediately respond to a request for comment.

The shift away of power from the city manager’s executive position to elected officials “further created the environment that gave rise to many of the issues concerning influence peddling, lack of compliance with lobbying rules, the proliferation of no-bid contracts, potential Brown Act violations and acts of preferential treatment,” the JL Group report said.

Former city development officials, some business leaders, and former elected officials described a business culture, JL Group investigators said, in which Sidhu and Ament controlled development projects in return for financial considerations.

The change in tone at the city was noted by developers and others who worked with Anaheim in the past.

Investigators interviewed Shaheen Sadeghi, a Laguna Beach-based developer of retail projects such as the LAB Anti-Mall in Costa Mesa and several projects in Anaheim, and reported that Sadeghi experienced what he termed “a cultural shift” following Sidhu’s election.

In previous years, Sadeghi and other developers would be asked to submit proposals on certain possible projects, depending on their interest. But, after Sidhu’s election, Sadeghi said he was no longer able to get a return call from the new mayor.

Sadeghi told investigators that during a lunch with former Anaheim Mayor Curt Pringle he asked Pringle “What’s the deal with this guy (Sidhu)? I called him like three times, and he won’t meet with me.’ Curt said, ‘Well, he is a pay to play mayor.’”

Last year, an FBI investigator alleged that Sidhu may have tried to slip confidential information to a representative of Angels owner Arte Moreno and his business group in negotiations to purchase the city-owned stadium with the intention of soliciting a large campaign donation later. He also was heard on an FBI wiretap telling Ament that he wanted money from the Angels after the completion of the sale.

The $320 million deal was scuttled by the City Council after news broke of the allegations and Sidhu resigned.

No criminal charges have been filed against Sidhu and his attorney has maintained that a thorough investigation would find no wrongdoing. FBI investigators noted in their search warrant affidavit it was unclear if the Angels representative knew of Sidhu’s intentions.

The city-commission investigators allege Sidhu leaked confidential information — including an appraisal of the Angel Stadium property that had not yet been made public and another document titled in part “Key Issues – Stadium Transaction Agreements” — through Ament and lobbyist Jeff Flint of FSB Public Affairs to the Angels Baseball Organization.

The FBI investigators never named the political consultant who was considered a ringleader with Ament of the so-called cabal that held sway in City Hall, but among the details provided are the consultant’s firm was in the same building as the Anaheim chamber, and lobbying reports required by Anaheim showed the consultant did work for stadium buyer SRB Management, Moreno’s business partnership, and those are consistent with Flint.

Shortly after the release of the affidavits, Flint said in a statement, “I have no hesitation in saying that I firmly believe I did nothing wrong nor illegal” and in case the allegations being made could harm his company, he was taking a leave of absence as its CEO. Flint was not immediately reached for comment on Monday.

Sidhu, JL Group investigators said, sent the documents from his personal email to Ament and Flint in July 2020.

The use of the personal email address “appeared to be an attempt to mask his activity and to potentially sidestep any Public Record Act requests,” the report said of Sidhu.

The reason for the leaked information, the report said, was to move the Angel Stadium sale along so Sidhu could “curry favor with the Angels Baseball organization” and “to support his political future.”

The city-commissioned investigators surmised that the FBI released its search warrant affidavit regarding Sidhu, along with Ament’s criminal complaint affidavit, in an effort to stop a stadium sale that could have been problematic.

“One can reasonably conclude that the real time evidence collection by the FBI rose to a level to which they felt the necessity to intercede and shed light” on their findings and “preclude the potentially tainted sale of one of the largest public land purchases in recent history,” the report said.

The investigation found that Sidhu’s expressed desire to have Ament solicit up to $3 million from the Angels upon completion of the stadium sale likely never led to an actual request because the sale was terminated. And while it noted that Sidhu was seen meeting with Moreno, Flint and Ament during the negotiating process, that alone didn’t make it a Brown Act violation without knowing what was discussed.

While the stadium deal was attacked by many, “the greater weight of credible evidence indicates that the city of Anaheim made an informed decision and entered into an agreement to sell the Angel Stadium site to the Angels,” the report said.

It acknowledged a “rush to complete the sale for a multitude of reasons,” but said it could not be determined that Sidhu’s “push to complete the sale had a negative effect on the sale.”

Additionally, the report alleged that Ament acted as a “hub” for elected officials to communicate through to garner favorable votes for various projects and developments. This practice, the report said, meant Ament was acting as “an unreported lobbyist” and conducting what the Brown Act would consider to be unlawful meetings.

“(T)here has seemingly existed a genuine contempt for government transparency and public participation relating to governmental projects and agreements concerning the actions of certain powerful actors in the city, including Ament, Flint and Sidhu,” the report said. “The rules and law seem to get in the way of certain elites’ desires and interests.”

“Whether it was handing over confidential documents during a negotiation to improve the chances of a successful Angel Stadium property sale negotiation or ‘fixing’ projects in favor of the ruling structure, the result of these corrupt practices has been to shortchange the public’s rights in terms of meaningful government participation, knowledge and understanding.”

From the early revelations of the FBI investigation, accusations that Sidhu instructed Ament to lie to the Orange County Grand Jury stood out to some legal experts as more problematic than other allegations surrounding the former mayor.

The JL Group report surmised the FBI used Ament’s letter to appear before the grand jury “to conduct an integrity assessment” of Sidhu.

“When Ament met with Mayor Sidhu, he (Sidhu) implored him to lie to the Orange County Grand Jury and not reveal any of the documents that were provided by the mayor to Ament,” the report said. It also said that when Ament, who was wearing a wiretap, feigned concern about email and text messages being discovered, Sidhu told him they were not on his city accounts and “he had erased everything already.”

Democratic State Sen. Tom Umberg, whose district includes Anaheim, called Monday for more accountability.

“I just received a copy of this report.  Already as a quick scan, it reads like a soap opera: fraud, helicopters, cannabis, cabals,” Umberg said. “It’s going to take some time to digest the implications, findings, and recommendations and even still, I know another investigation is occurring by the FBI.”

Mayor Ashleigh Aitken said Monday she is creating a Mayor’s Advisory Committee that would include “government, community, business, and legal leaders” to review the report and offer reforms for council discussion.

“This will be a public-facing process, and I look forward to discussing it with the residents of our city in the weeks and months ahead,” she said in a statement. “Together, we will rebuild public trust and work to make sure Anaheim’s city government lives up to its obligations to our residents.”

The JL Group investigators offered a laundry list of recommendations for the City Council to consider.

The investigation recommends placing a tighter hold on city money contributed  to the Chamber of Commerce and the Visit Anaheim tourism office and that the city try to “claw back” any money illegally received.

Under those recommendations no more money would be given by the city until full forensic audits were conducted on the chamber and Visit Anaheim and all their controlled nonprofits for the last seven years. Another accounting for a five-year period would be done each year before public money was given.

Other recommendations included creating a city ombudsman/ethics officer who could only be removed for misconduct, malfeasance or incompetence. The ombudsman’s duties would include monitoring  political contributions, independent expenditures and other money spent on city races, as well as lobbying.

Employees who are lobbied would be required to report it to the ombudsman, who would check it against the lobbyists official disclosures.

Click here to read the full article in the OC Register

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