Evidence from the prosecution of Raymond “Shrimp Boy” Chow potentially implicates a wide array of city and state leaders, including Mayor Ed Lee, in alleged bribery schemes, pay-to-play plots, campaign fund laundering and state construction contract rigging.
According to a Tuesday filing by Chow’s attorneys in federal court, which includes never-before-released details and names from a yearlong investigation by the Federal Bureau of Investigation, Mayor Lee, some of The City’s leadership, an Alameda County prosecutor and a state official were all named in alleged wrongdoing caught on tape or witnessed by undercover FBI agents or their sources.
The allegations are outlined in the documents, but those named have not been charged in relation to the investigation, and several have denied the allegations.
Lee said he hadn’t read the documents in detail, and the parts he read were repetitious. “He’s trying to get off the trial, Mr. Raymond Chow. He’s doing anything he can. I have to take it with a grain of salt,” Lee said Tuesday.
He continued, “I ran a clean campaign … just last week the Ethics Commission closed out our campaign … if we did anything improperly, it would’ve shown up.”
In March 2014, law enforcement raids across the Bay Area detained more than 20 people, including former state Sen. Leland Yee, former school board member Keith Jackson and Chow.
The arrests stemmed from a federal indictment alleging, among other things, that Chow headed an organized gang outfit in Chinatown and that Yee and Jackson committed a series of crimes to further Yee’s political ambitions. Yee and Jackson have since pleaded guilty to racketeering and other charges.
The Tuesday filing on behalf of Chow requests the case against him be dismissed because of alleged selective prosecution, pointing out that numerous public officials were caught up in FBI surveillance but never indicted.
“The government has admitted the political corruption investigation which sought to ensnare many Bay Area political figures, was instigated contrary to desire of the government; what it has not admitted is that it resulted in snagging at least a dozen bottom feeding political types,” said the filing by Chow’s legal team, which includes attorneys Tony Serra, Curtis Briggs and Greg Bentley.
The filing, which quotes and references FBI wiretaps, body wires, agents and sources, gives a new glimpse into the breadth and depth of the yearlong FBI probe into organized crime in Chinatown and alleged political corruption in San Francisco, the Bay Area and state.
The U.S. Attorney’s office did not return calls for comment on the case.
The alleged misconduct started at the top, according to the filing and its FBI sources.
“The FBI alleged in discovery that Ed Lee took substantial bribes in exchange for favors,” notes the filing, which goes on to say that then-Human Rights Commissioner Nazly Mohajer and commission staff member Zula Jones facilitated those exchanges.
Jones was reported by the FBI to have said that former mayor Willie Brown taught Lee to do business, according to the filing.
“You got to pay to play here. We got it. We know this. We are the best at this game … better than New York. We do it a little more sophisticated than New Yorkers. We do it without the mafia,” Jones reportedly said.
Mohajer allegedly “explained the process by which she launders Ed Lee’s campaign money,” said the filing, which went on to say that Lee took $20,000 in campaign contributions, gifts and trips in his first four months in office. The filing alleges Jones and Mohajer said Lee “knew he was taking the money illegally.”
Lee attended a meeting on April 6, 2012, with Jackson, Jones, Mohajer and an undercover FBI agent (UCE-4773) posing as a businessman, according to the filing. Mohajer then introduced the agent to Lee as an “individual who had raised $10,000 to assist in retiring the campaign debt.”
The campaign contribution limit in local races is $500.
The San Francisco Examiner asked the mayor about that meeting, and he replied, “I can’t remember everybody that I meet. I met a lot of people during the 2011 campaign.”
In the video below, Mayor Ed Lee responds to reporters’ questions about the allegations. Video by Joe Fitzgerald Rodriguez.
Neither Mohajer, who is no longer a commissioner, or Jones could not be reached for comment.
In 2000, Jones was a contract compliance officer for the San Francisco Human Rights Commission who was indicted along with a mechanical contracting firm for an alleged scheme to defraud The City. The charges were eventually dropped.
But others in City Hall also seem to have taken part in this kind of behavior, according to the filing.
Board of Supervisors President London Breed, specifically, is named in the filing as a politician who one can pay for access and favors.
In Breed’s case, according to the filing, Derf Butler, a politically connected businessman who worked for Yee with Jackson, told an FBI source that he “pays Supervisor Breed with untraceable debit cards for clothing and trips in exchange for advantages on contracts in San Francisco.”
Breed denied the claim Tuesday.
“That’s absolutely false. I can’t be responsible for what other people say,” Breed said. “Where’s the evidence? Where’s the proof? I can say without a doubt that I didn’t take anything from anybody. If I had, I would probably be prosecuted as well.”
The entire investigation, Breed said, appears to have been a fishing expedition by the FBI, and in many cases they unfairly focused on black leaders.
Butler could not be reached for comment.
The filing also touches on the head of the local chapter of the NAACP. For instance, on April 12, 2013, a phone tap recorded Jackson calling Butler and talking about NAACP president Rev. Amos Brown’s house being fixed in exchange for some unsaid favor from former Housing Authority head Henry Alvarez.
“They got evidence that he was getting his damn house fixed on,” Jackson was recorded to have said. “Henry was sending people over there doing shit for Reverend Brown.”
When asked about the filing, Brown denied its veracity. “It’s nothing but a lie,” said Brown. “That is a lie.”
OTHER OFFICIALS NAMED
San Francisco Municipal Transportation Agency employee Sululagi Palega was also named in the FBI’s investigation and allegedly sold a gun to an agent.
According to the filing, on March 21, 2013, an undercover FBI agent (UCE-4599) met with Palega in the agent’s car.
“Palega handed UCE-4599 a See’s candy bag. In the bag was a .45-caliber revolver. Palega told UCE-4599 to ‘enjoy the candy,’” according to the filing, which referenced FBI discovery.
Later, over lunch with Jackson and his son, Brandon, Palega was given “$500 for the .45-caliber Magnum handgun he previously gave UCE-4599. Palega then told UCE-4599 that he ‘talked to his guy and whenever you are ready,’” according to the filing.
Palega, who works in the SFMTA’s ambassador program for young adults, could not be reached for comment.
The FBI investigation also reached beyond San Francisco, according to the filing. In following Yee’s efforts to collect campaign funds for his failed mayoral push, the FBI seems to have uncovered efforts by an Alameda County’s Assistant District Attorney to do the same.
On Nov. 30, 2012, the FBI recorded Yee getting a call from Alameda County Deputy District Attorney Sharmin Bock to discuss campaign contributions. Bock ran unsuccessfully for San Francisco District Attorney in 2011.
“Just to let you know, all the checks have been vetted,” Yee said in the recording. Bock then replied: “It’s not like strip club money or anything like that right? I’m good,” according to the documents.
In another recorded phone conversation between Jackson and Butler on April 6, 2013, they talk about exchanging money for Yee and Bock.
“Check that we gave that politician, DA, whoever, it didn’t go through, what’s going on?” asked Jackson.
An unnamed FBI agent wrote of that exchange: “I believe this conversation related to Jackson helping Yee swap checks with Sharmin Bock to circumvent campaign financing laws.”
Bock did not return several calls for comment.
Campaign filings in San Francisco show both Yee and Bock had the same political consultant, Jim Stearns.
The investigation also reached into state government. The filing mentions a recorded phone call between Taj Reid and Eric Worthen, a former official in the state’s veterans affairs department.
Worthen was legislative director for Yee from 2010 to 2011. Reid is listed as living at the same address as Oakland City Councilman Larry Reid.
On April 16, 2013, the FBI taped a phone call between Reid and Worthen about a construction contract that an FBI source called CHS No. 11 (confidential human source number 11) planned to bid on.
On April 17, 2013, a meeting was recorded between Worthen, Reid and CHS No. 11 in San Francisco to plan their discussion detailing how the scheme would work.
In the scheme, CHS No. 11 would pay the other two men $10,000, and in return Worthen would manipulate the bidding processing for a veteran’s home project in Ventura.
According to the documents, Worthen said in the recording that he could pass along internal department documents so CHS No. 11 would know what he was up against. “I will make sure that you have the general … the basic specs … once it goes up,” said Worthen in the filing. Reid added that with Worthen in their corner, “You know when everything goes down, [CHS No. 11] gonna get the job.”
The source called CHS No. 11, then said, “Let’s keep it on the hush on any job [Worthen] has coming through the pipeline agency. If you know, that is the play. That’s the play right there. And keep it in this room.”
Worthen then tells the two, “I always worry about me first and foremost before anything and everyone.”
To that CHS No. 11 replied: “You are going out on a ledge … and you know this is a deep ledge … and so I we got to be tight and trust each other…”
“I believe these comments indicate Worthen and Reid are arranging a bribery conspiracy whereby Worthen will use his discretionary authority as the Deputy Assistant Administrator of the California Department of Veterans Affairs to deliver a development deal to CHS #11 in exchange for money,” wrote an unnamed FBI agent.
Worthen had no comment when contacted by the San Francisco Examiner. Reid could not be reached for comment.
San Francisco Examiner Staff Writer Joe Fitzgerald Rodriguez contributed to this report.
Below is a copy of the filing, which does not include the exhibits.