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Beverly Hills developer to plead guilty to bribery over $45 million lease

The developer offered to buy a million-dollar home for a county official who had started cooperating with an FBI investigation.

LOS ANGELES (CN) — A Beverly Hills real estate developer has agreed to plead guilty to bribing a Los Angeles County official, including by offering to buy him a million-dollar home, so the county would sign a $45 million office lease at one of the developer's properties.

Arman Gabaee, 61, the co-founder and co-managing partner of the Charles Company, had been scheduled to go on trial next month in the bribery case. He faces a maximum sentence of 10 years in prison and has agreed to pay a fine of at least $1.15 million, according to a statement Wednesday from U.S. attorney's office in Los Angeles.

From about 2011 to April 2017, Gabaee, professionally known as Gabay, funneled monthly payments to Thomas Shepos, who worked at the county's real estate division and who was involved in awarding contracts to developers and contractors. In exchange, Shepos provided Gabaee with county leases, preferential contract terms, and nonpublic information, according to the government.

By 2017, Shepos had started to cooperate with the FBI and secretly recorded his conversations with Gabaee. At that time, Gabaee offered to buy Shepos a million-dollar home in Northern California in exchange for Shepos’ help in securing a county lease at a mall in Hawthorne which Gabaee was redeveloping. Gabaee wanted the county to enter into a 10-year, $45 million lease for county departments to rent office space in the Hawthorne Mall.

Gabaee was arrested and charged in 2018. Shepos pleaded guilty that year to lying to federal investigators looking into his dealings with Gabaee and is scheduled to be sentenced in June.

An attorney for Gabaee didn't immediately respond to an email seeking comment on the plea agreement.

Charles Company, which Gabaee owns with his brother, has been a major office and residential developer in the Los Angeles area. One of the company's most recent projects now under construction is the sprawling, Gensler-designed Melrose Triangle in West Hollywood. The company last year reportedly sold an industrial and office complex in the San Gabriel Valley, which was largely leased to LA County, for $40 million.

Gabaee's plea agreement comes amidst a growing list of high-profile corruption cases in the LA area. This week the former head of the LA Department of Water and Power was sentenced to six years in prison for bribery because he helped a lawyer win a $30 million, no-bid contract from the utility that was completely unnecessary. A former LA City Council member meanwhile is awaiting trial for soliciting bribes from real-estate developers to help their downtown LA projects win approval.

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