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By Fred Shuster
A former Los Angeles deputy mayor played a key role in a complex City Hall-based bribery scheme run by ex-City Councilman José Huizar designed to “get money, keep power and avoid the feds,” a prosecutor told jurors Tuesday, but a defense attorney insisted that Raymond Chan did nothing wrong and is the victim of overzealous prosecution.
Chan is facing a dozen criminal counts, including racketeering conspiracy, bribery, honest services fraud and lying to federal agents.
“This is a public official who secretly abused his position to set himself up for a payday,” Assistant U.S. Attorney Susan S. Har told the downtown Los Angeles jury in opening statements of Chan’s trial.
Chan, 66, of Monterey Park, is accused of being a member of what prosecutors dubbed the Council District 14 “enterprise,” a conspiracy which operated as a pay-to-play scheme in which Huizar — assisted by others — unlawfully used his office to give favorable treatment to real estate developers who financed and facilitated bribes and other illicit benefits.
Huizar pleaded guilty last month in Los Angeles federal court to felony charges for using his powerful position at City Hall to enrich himself and his associates, and for cheating on his taxes. He faces multiple years behind bars at sentencing on April 3.
A deputy mayor who oversaw economic development for ex-Mayor Eric Garcetti in 2016 and 2017, Chan is charged with allegedly arranging indirect bribe payments to city officials by lining up employment contracts for the officials’ relatives.
“It’s a great story,” Chan’s attorney, Harland Braun, said sarcastically in his opening statement, telling the jury there is not “a speck of evidence” that his client acted corruptly.
The defense attorney promised that Chan would take the stand and refute the government’s allegations.
Chan worked for the city for almost three dozen years, serving at one point as the top executive overseeing the Department of Building and Safety, which reviews building plans and inspects construction projects.
Court papers show the government plans to call more than a dozen witnesses in its case, including Huizar’s wife, Richelle Rios. Rios is expected to be asked about Huizar’s position as chair of the city council’s powerful Planning and Land Use Management Committee, her knowledge of those who did business with her husband, and her bid to follow Huizar as representative for the 14th council district.
The government also intends to call three witnesses — George Esparza, Huizar’s former special assistant; lobbyist Morrie Goldman; and real estate development consultant George Chiang — who have entered into plea agreements in which they agreed to cooperate with prosecutors.
In her statement to the jury, Har alleged that after Deputy Mayor Chan retired from the city, he began working with Chiang doing consulting and lobbying on behalf of developers. In 2017, Har said, Chan established a company and opened a bank account for the purpose of, among other things, receiving payments from Chiang and making illegal payments to himself.
The defendant “acted as a go-between” for Huizar and various wealthy developers, the prosecutor said, calling Huizar and Chan “the perfect combination. They needed one another for the pay-to-play scheme to work.”
Before Huizar signed his plea deal, he and Chan were scheduled to go on trial together.
Two previous trials arising out of the 2020 indictment against Huizar, Chan and various associates have ended in convictions.
In the first Huizar-related trial, a federal jury found Bel Air real estate developer David Lee and 940 Hill LLC, a Lee-controlled company, guilty of felony charges, including fraud and bribery, for providing $500,000 in cash to Huizar and his special assistant in exchange for their help resolving a labor organization’s appeal of their downtown development project.
In the second trial, real estate development company Shen Zhen New World I LLC was found guilty of paying Huizar $1 million in bribes to obtain city approval to build a 77-story skyscraper.
During the Shen Zhen trial, Huizar’s 83-year-old mother, his older brother and Rios testified for the prosecution.
Federal prosecutors have thus far convicted nine defendants and received over $3 million in criminal penalties to resolve the federal probe into two other major real estate development companies, as a result of operation “Casino Loyale,” the investigation into City Hall corruption conducted by the FBI and the U.S. Attorney’s Office.
Huizar’s older brother, Salvador Huizar, 57, of Boyle Heights, pleaded guilty last year to lying to FBI agents about receiving envelopes of cash from his brother. He is set to be sentenced in May.
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