Corruption Probe Takes Down Another at LA City Hall

Los Angeles City Hall. (Chris Marshall/CNS)

LOS ANGELES (CN) — A former city staffer and current aide to a California assemblywoman pleaded guilty Wednesday to racketeering charges, the latest person to admit to an ongoing money-making scheme at Los Angeles City Hall.

George Esparza worked as a special assistant to LA City Councilman Jose Huizar until December 2017. Esparza’s indictment details bribes paid to an unnamed councilman to move ahead development projects in their district, to help a relative’s political aspirations and even settle a sexual harassment lawsuit.

In the last several months, the federal corruption probe at City Hall has resulted in multiple arrests.

In March, former councilman Mitch Englander pleaded guilty to obstructing a federal probe of his actions while in office after a real estate developer showered him with cash, trips and expensive meals.

In a separate plea agreement, Justin Jangwoo Kim — a 53-year-old real estate appraiser and political fundraiser — pleaded guilty to coordinating a bribe for an unnamed councilman to advance a developer’s project.

This month, real estate broker George Chiang pleaded guilty for his involvement in the pay-to-play scheme prosecutors detailed in his indictment, which included a criminal enterprise perpetrated by an unnamed councilman.

Huizar has not been arrested or charged as part of the corruption probe. But his offices and home were raided by FBI agents in 2018.

All previous indictments corroborate evidence that the unnamed councilman in the money-making scheme is Huizar and Esparza’s cooperation and indictment announced Wednesday furthers that theory.

Esparza, 33, of East Los Angeles, agreed to plead guilty to one count of conspiring to violate federal anti-racketeering law.

Esparza admitted to assisting an unnamed councilman in the criminal scheme according to prosecutors. The charging document against him references Councilmember A who sat on the Planning and Land Use Committee and the Economic Development Committee. Huizar on both committees.

The complaint goes on to say the unnamed councilman’s relative received biweekly payments of about $2,500 from a law firm as part of her employment where she did marketing and business development.

From July 2012 through January 2016, the relative also received payments from a high school, totaling $150,000 as a fundraiser according to prosecutors. And sometime in September 2018, the relative announced she would run for her relative’s seat on the city council.

Jose Huizar will term out of office next year and Kevin de León, former president pro Tempore of the California State Senate, was elected to the cseat.

Prior to the FBI raids at Huizar’s office his wife, Richelle, was set to run for his seat. Kim’s indictment details the unnamed councilman wanted his share of a $200,000 bribe being held by a city staffer because the councilman had “expenses” related to their relative running for office.

Esparza admitted he was part of the criminal enterprise beginning in early 2013, according to federal prosecutors. That ended in November 2018 when he began cooperating with federal authorities.

Esparza and the unnamed councilman accepted bribes to file favorable motions and vote on projects in city council and the Planning and Land Use Committee, prosecutors say.

The plea agreement also says Esparza exerted pressure on developers with projects pending before the city and the unnamed councilman took official action to boost the developers’ reputation and marketability in the city.

That included a company run by a Chinese billionaire, referred to as Chairman E in the charging documents.

“Chairman E provided defendant Esparza and Councilmember A financial benefits in over a dozen trips to casinos in Las Vegas and Australia,” prosecutors write in the plea agreement. “Between June 2014 and January 2018, defendant Esparza personally accepted at least approximately $32,000 in gambling chips, plus flights on private jets and commercial airlines, stays at luxurious hotels, expensive meals and alcohol, spa services, event tickets, and escort services from Chairman E.”

At the request of a person referred to as Individual 1 in court documents Chairman E paid $600,000 to the unnamed councilman to help him confidentially resolve a sexual harassment lawsuit in 2014.

According to the charging documents the unnamed councilman assisted the developer’s requests, like ensuring the passage of a resolution before city council that recognized Chairman E’s “achievements and contributions to the economy” of his council district.

In 2014, Huizar settled a sexual harassment lawsuit filed by a former aide. At the time, the City Attorney’s Office said the settlement would not cost the city.

The charging document says Esparza sought to help Chairman E’s plans to “redevelop Property E into the tallest tower west of the Mississippi River, specifically, a 77-story skyscraper featuring a mix of residential and commercial uses.”

That included seeking tax rebates and other incentives from the city for the project according to Esparza’s plea agreement.

In a May 2017 phone call, Esparza told another city staffer that, “Chairman E should have all the leverage in the world [be]cause of what [Councilmember A] owes [Chairman E].”

By December 2017, Esparza met with the unnamed councilman in a private bathroom at City Hall to discuss Esparza’s interviews with FBI agents and a cash bribe he was holding for the councilman.

A $500,000 cash bribe was made to the councilman by another developer to settle an ongoing labor dispute, which halted the process of their project says the charging document. Prosecutors say that bribe was facilitated by Kim and with the help of the councilman’s pressure on the labor organization would save the developer $30 million. Esparza says he negotiated that bribe and discussed the matter with the labor union, according to prosecutors.

Esparza admitted taking bribes from another person, described as Businessman A, who was introduced to developers. Esparza collected monthly payments of $8,000 to $10,000, sometimes in restaurant bathrooms according to the plea agreement.

Esparza also attended a business trip to Las Vegas in June 2017 — as did Englander. In Englander’s indictment, prosecutors say he was put up at a pricey hotel and given an envelope with $10,000 in cash, $1,000 in casino gambling chips, $34,000 in bottle service at a nightclub, and a $2,481 dinner at a restaurant.

Another sitting councilman, John Lee, already admitted he attended the Las Vegas trip and this past March said he would cooperate with the FBI investigation.

Huizar’s attorney declined to comment.

It is not clear if Esparza — who most recently worked for Assemblywoman Wendy Carrillo, a Los Angeles Democrat — has an attorney. He faces up to 20 years in prison.

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