New details show sprawling web of corruption in Southern California cannabis licensing
As a California lawmaker called for a statewide task force to crack down on corruption in the legal cannabis market, new details are emerging in a bribery scandal that has ensnared local government officials from the Inland Empire to the San Gabriel Valley and southeast Los Angeles County.
Federal prosecutors have unveiled two plea agreements that detail pay-to-play schemes involving cannabis business licensing and corroborate allegations in a Times investigation last month that examined how legalization of weed unleashed a wave of corruption across California.
In one of the agreements, former Baldwin Park City Councilmember Ricardo Pacheco admitted soliciting bribes from weed businesses — including $150,000 from a consultant working for a local cannabis distributor. The consultant declined, but at the direction of the FBI delivered campaign contributions requested by Pacheco, the agreement said. The agreement doesn’t name the distributor, but its description of the dates the firm was awarded the exclusive right to distribute cannabis matches only one company, Rukli Inc.
In the other plea agreement, a former San Bernardino County planning commissioner, Gabriel Chavez, admitted acting as an intermediary to funnel bribes from pot businesses to Pacheco as part of the scheme.
Assemblymember Cristina Garcia (D-Bell Gardens) asked state Atty. Gen. Rob Bonta in writing Thursday to create a task force to examine corruption in local cannabis licensing and ensure that cities are awarding permits without favoritism. She cited The Times investigation, along with recent corruption prosecutions.
“My hope is that this task force will investigate and prosecute any illegal activity tied to awarding cannabis licenses,” Garcia wrote in her letter to Bonta. “I also hope that your office is able to create a road map for future cities to ensure pay-to-play schemes and any illegal activity associated with cannabis licensing ends.”
California’s legalization of recreational cannabis in 2016 ushered in a multibillion-dollar industry. But many of the promises of legalization have proved elusive.
Also in response to The Times investigation, Assemblymember Reggie Jones-Sawyer (D-Los Angeles) said he planned to request a state audit on cannabis licensing.
Other state officials have responded to The Times’ recent investigation of legal weed, particularly the newspaper’s findings that legalization triggered a surge in outlaw cannabis grows. The grows have engulfed entire communities and resulted in environmental damage, increased violence and exploitation of workers, including some who have died from carbon monoxide poisoning from generators while trying to keep warm.
Gov. Gavin Newsom’s office this summer directed his emergency operations, cannabis licensing, water regulation and environmental protection agencies to form a task force targeting illegal cannabis farms.
The task force also includes the state’s Campaign Against Marijuana Planting, renamed by Bonta as EPIC, short for the Eradication and Prevention of Illicit Cannabis. In the past, CAMP leaned heavily on National Guard troops and helicopters each summer to cut down illegally grown plants on public land. In a webcast news conference this week, Bonta said EPIC would now be year-round and also take on organized crime as well as labor trafficking.
Law enforcement officers within the new state program and in counties grappling with rampant unlicensed cannabis farms voiced skepticism. They noted the task force involves agencies already working together, and no new resources are being provided to already short-staffed field teams, with the exception of a call for volunteers from within the Department of Justice to increase the cannabis program from one employee to five.
“I feel as if the state came to our county, doused it with gasoline, set fire to it, then began praising themselves for offering us a garden hose to deal with what they had created,” Mendocino County Sheriff Matt Kendall said.
The Times identified more than a dozen government officials statewide who received income — ranging from thousands of dollars to hundreds of thousands — from cannabis companies or had interests in weed businesses while still in office.
In some instances, local government officials took on dual roles as lobbyists or consultants for pot interests. The vast majority of cities have no lobbyist or consultant registry that would track this activity.
The payments are legal as long as officials disclose them and don’t cast votes that would financially benefit the firms paying them.
Commercial cannabis resulted in corruption and questionable conduct that has rocked local governments across California, a Times investigation found.
But the accusations in the two plea agreements involving Pacheco and Chavez in Southern California go further, alleging a scheme in which public officials used their offices to do favors for cannabis businesses and other public officials in return for bribes.
One such arrangement involved a former Huntington Park city manager, who doubled as a pot business consultant and was representing a weed company seeking a permit in Baldwin Park, the plea agreement for Chavez alleges. The city manager signed a $14,500 city contract for Chavez’s internet marketing company while Chavez was acting as an intermediary for bribes, passing along cash to Pacheco, according to the documents.
The no-bid contract “represented, in part, further compensation for Chavez in his efforts facilitating the bribe to Pacheco to secure the marijuana permit,” a Department of Justice news release said.
The documents don’t name the former Huntington Park city manager but say he is currently the city manager of Commerce and served on the board of the Montebello Unified School District. That person is Edgar Cisneros.
Cisneros’ office referred The Times to Commerce City Atty. Noel Tapia, who said that the City Council was aware of the allegations and monitoring the situation. He also noted that Cisneros has not been charged in the investigation.
FBI agents previously conducted several raids on local government officials, including the office of Baldwin Park’s city attorney, Robert Tafoya, and the home of former Compton City Councilmember Isaac Galvan.
The plea agreements announced last week allege Tafoya, identified as Person 1, advised Pacheco how to set up the bribery scheme, including the use of a middle man to funnel bribes. The agreements identify Person 1 as the Baldwin Park city attorney.
On Wednesday evening the Baldwin Park City Council voted unanimously to accept Tafoya’s resignation as city attorney.
Illegal cannabis farms are engulfing parts of California and exploiting farmworkers who labor in squalid, deadly conditions, a Times investigation finds.
His lawyer, Mark Werksman, said Thursday that Tafoya’s “actions as city attorney at all times were lawful and ethical,” and he accused Pacheco and Chavez of “flinging accusations against innocent people to save their own skin.”
Garcia said she hopes an attorney general task force would root out corruption as well as identify how cities can better oversee pot licensing to prevent conflicts of interest, and asked that the task force first focus on southeast Los Angeles County.
“Abusing public funds and corrupting our local democratic processes for personal gain is detrimental to governance,” Garcia said. “While I’m a supporter of legal cannabis, I want to make sure it’s done in a way that’s fair and doesn’t corrode the public’s trust in our system.”
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