San Francisco utilities chief found guilty on six of eight counts in corruption trial

SAN FRANCISCO (CN) — A federal jury on Friday found former San Francisco Public Utilities Commission chief Harlan Kelly guilty on six of eight corruption-related charges.

The jury deliberated for slightly more than a day before delivering a verdict. When asked how he felt about the verdict, Kelly told reporters he was “processing it.” Kelly’s wife, Naomi, called the verdict “unfortunate.”

“We just move on. We’re preparing for the next steps,” Naomi Kelly said.

Kelly had pleaded not guilty to the charges.

Jurors found Kelly guilty on four counts related to a scheme to defraud Quicken loans and guilty of two of four counts related to bribes he received from billionaire Walter Wong. 

Kelly could face a maximum of 30 years in prison if convicted, although attorneys said he likely would not face the maximum sentence.

His attorney Brian Getz told reporters he “felt strongly about the innocence of Harlan Kelly.”

“We’re trying to absorb the verdict,” Getz said.

Getz added that he was grateful for the work of the jurors, but he was disappointed in their verdict. He said he and Kelly are considering all options prior to sentencing, including potentially filing an appeal because of insufficient evidence.

Kelly “feels crushed,” Getz said. “Going to trial on a case with stakes this high is a heavy burden.”

Prosecutors said Kelly’s criminal activity centered around two separate schemes, including conspiring with Wong to land a city streetlight project to Wong in exchange for bribes including free and discounted construction work, a trip to China for his family, and more.

Wong testified at trial that he gave benefits to Kelly in the hopes that Kelly would award him a city streetlight contract. Wong is cooperating with the United States government in hopes of a lighter sentence.

Prosecutors told jurors Kelly defrauded Quicken Loans by conspiring with real estate mogul Victor Makras to hide the true nature of his debts on a loan application. Kelly sought the $1.3 million loan to pay off his construction and personal debts, as well as his wife’s student loans.

The trial lasted weeks in front of U.S. District Judge Richard Seeborg, with emails, documents, and text messages presented as evidence. Prosecutors painted Kelly as a conniving manipulator who knowingly participated in both schemes. His defense argued Kelly was only guilty of trusting the wrong people.

The verdict is the latest in a corruption investigation that swept up many San Francisco officials and others.

Wong pleaded guilty to fraud and money laundering charges in 2020 and was ordered to pay the city a $1.7 million settlement. Wong is cooperating with the government in their ongoing investigation of city corruption. Makras was sentenced to three years probation and ordered to pay a $15,200 fine for providing false statements to Quicken Loans to help Kelly secure the loan.

Also Friday, former building inspector Bernie Curran was sentenced to a year in jail for accepting gratuity payments in exchange for building permits. Mohammed Nuru, the former public works chief, is serving seven years in prison for bribery and kickbacks.

Sentencing dates have not been set.

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