Bribery trial starts for hotel firm linked to LA Councilman Huizar
By FRED SHUSTER
A federal prosecutor told a jury Thursday that a China-based hotel company owned by a fugitive real estate developer bribed former Los Angeles City Councilman José Huizar with over $1.5 million in cash, trips on private jets and “casino chips and prostitutes” in exchange for his official support of a downtown redevelopment project, but the defense countered that city officials “universally loved” the project, so “there was no reason to bribe anyone.”
Shen Zhen New World I LLC, an entity owned by developer Wei Huang, is charged with bribing Huizar to make sure city officials approved the L.A. Grand Hotel project, a proposed 77-story mixed-use skyscraper in downtown Los Angeles. Huang is believed to be in China and has never appeared in a Los Angeles courtroom in connection with the case.
“The stream of bribes turned into a flood” as Huang lavished Huizar with gifts, including a 10-day trip to Australia, visits to golf resorts, luxury suites, cash and private gambling in Las Vegas hotels, Assistant U.S. Attorney Patrick Castañeda alleged in his opening statement.
Huang also allegedly provided Huizar and his special assistant George Esparza with a “lineup of prostitutes for their choosing” during the trips, the prosecutor said. “It would become a recurring theme of their trips together.”
However, Richard M. Steingard, co-counsel for Shen Zhen New World, countered that while Huizar did take trips with Huang, the benefits were freebies paid for by the casinos in order to keep the billionaire developer — considered a high-rolling “whale” in the gambling world — coming back.
The trips “had absolutely nothing to do with the L.A. Grand Hotel redevelopment project,” and Huang never asked the then-councilman for “anything of consequence” in return, Steingard told the jury.
Huang never asked for special favors or official support for his proposed skyscraper because City Hall officials “universally loved” the concept, which would bring countless jobs to downtown, the attorney alleged.
“There was no reason to bribe anyone,” the defense attorney insisted.
Further, Steingard said, there is no evidence Huizar took any action regarding the project.
The indictment charges Shen Zhen New World — whose two managers sat at the defense table — with bribery in three forms: bribery of a public official; interstate and foreign travel in support of bribery; and devising and participating in a scheme to defraud the city of Los Angeles and its citizens of Huizar’s honest services.
Federal prosecutors contend that in 2010, Shen Zhen New World paid $63 million to acquire the L.A. Grand Hotel, located in the 14th council district, which was represented by Huizar. The then-councilman was also the chair of the Planning and Land Use Management Committee, commonly referred to as the PLUM Committee, which oversaw commercial and residential development projects in the city.
In June 2018, Shen Zhen New World filed an application with the city planning department to redevelop the L.A. Grand Hotel into a skyscraper featuring a mix of residential and commercial uses.
The indictment alleges that between February 2013 and November 2018, the company, acting through owner Huang, provided Huizar and Esparza with cash, casino gambling chips, flights on private jets and commercial airlines, stays at luxury hotels, expensive meals, spa services, escort services, political contributions, and a favorable loan.
Castañeda alleged in his opening statement that at the time Shen Zhen New World and Huang provided these benefits, it did so to influence the then- councilman to present motions and resolutions in various city committees to benefit the L.A. Grand Hotel project; vote on the project in the PLUM Committee and City Council; take action in the planning committee to expedite the approval process; exert pressure on other city officials to influence the approval process of the project; and introduce or vote on city resolutions that could enhance the professional reputation and marketability of Shen Zhen New World and Huang.
The company through its attorneys deny that anything that was provided to Huizar or Esparza was intended to influence any acts designed to benefit the L.A. Grand Hotel redevelopment project.
The case against Shen Zhen New World is part of the sprawling July 2020 racketeering indictment against Huizar and various associates. The 34-count indictment, alleging wide-ranging political corruption, was broken up into three trials in L.A. federal court.
Previously, real estate developer Dae Yong Lee and one of his companies were convicted of federal criminal charges for providing $500,000 in cash to Huizar and his special assistant in exchange for their help in resolving a labor organization’s appeal of their downtown Los Angeles development project and obstructing justice by falsifying financial documents.
Huizar and former Deputy Mayor Raymond Chan are scheduled to go to trial on Feb. 21 on charges alleging they conspired to violate the Racketeer Influenced and Corrupt Organizations Act. The ex-councilman allegedly agreed to accept at least $1.5 million in illicit financial benefits and faces dozens of additional charges.
Esparza, the former aide to Huizar, pleaded guilty to a federal racketeering conspiracy charge in the corruption probe at City Hall and is scheduled to be sentenced next June. He is set to testify against Shen Zhen New World.
Huizar was suspended from the City Council two years ago and eventually replaced after he was charged in the wide-ranging federal investigation. His older brother, Salvador, recently pleaded guilty to lying to FBI agents about receiving envelopes of cash from the former councilman and agreed to help in the prosecution of his brother.