FBI corruption inquiry could bring political fallout for Eric Garcetti and other L.A. leaders

Mayor Eric Garcetti crisscrossed the country last year, arguing that Los Angeles is setting an example by boosting the minimum wage and investing in public transit, a record he says stands in contrast to the dysfunction of Washington, D.C.

But if Garcetti runs for president, he could also face uncomfortable questions about a topic that has gripped City Hall: Why are FBI agents seeking evidence of bribes, extortion and money laundering possibly involving L.A. city officials? And why are two of his appointees — one current, one former — being scrutinized in that probe?

Two months after FBI agents raided the home and offices of City Councilman Jose Huizar, no one has been arrested and no charges have been publicly filed.

But as new details emerge about the probe, the investigation could nonetheless be a drag on the careers of politicians looking to keep their jobs or move up the ladder.

Huizar has already experienced some of the political fallout: In the wake of the FBI raids, he was removed from four council committees, including the powerful panel he headed that vets large real estate development projects. His wife, Richelle Huizar, also pulled the plug on her own campaign for council in the weeks after the searches.

But Huizar is not the only politician who could be affected. Investigators have also scrutinized other City Hall officials, according to a recently publicized warrant that sought records from Google.

In that warrant, agents said they were seeking evidence of possible bribery, extortion, money laundering and other crimes involving more than a dozen people, including Councilman Curren Price and current and former aides to Garcetti, Council President Herb Wesson and Huizar. The warrant also named executives of Chinese firms bankrolling downtown development projects.

READ MORE: FBI corruption probe of L.A. City Hall focuses on downtown development boom »

The warrant does not say the FBI has gathered evidence of criminal activity by any of the people or companies named in the document. But experts say that the whiff of scandal around City Hall could be fodder for political rivals if Garcetti launches his campaign for president, even if the mayor had no role in any alleged wrongdoing.

“It certainly doesn’t help Eric Garcetti to be connected in any way” to the FBI probe, said Sherry Bebitch Jeffe, a political analyst and former USC professor. “It allows opponents to reflect on his leadership, his judgment of character. I’m not saying it’s right — but it can happen.”

Jeffe added that unease over the investigation could be a bigger problem in a national campaign, since many voters “don’t know him from Adam.”

Garcetti’s political advisor, Yusef Robb, said he did not believe the federal probe would be an obstacle in a campaign if Garcetti ran for president. Every candidate will be scrutinized and questioned about their record, their fundraising and, if they are in the business world, their investments, he said.

Garcetti said he had “zero tolerance” for unethical behavior at City Hall — and that Angelenos deserve to have public servants who act with integrity.

Garcetti’s former deputy mayor of economic development, Ray Chan, and current public works commissioner Joel Jacinto, a Garcetti appointee, were both named in the Google warrant, which sought records from a Gmail account used by Chan. When Garcetti tapped Chan as a deputy mayor in 2016, he said Chan was among the “proven leaders with proven records” at City Hall.

Before that, Chan was serving under Garcetti as the head of the Department of Building and Safety, which oversees permitting and inspections for development projects.

It is unclear whether investigators are looking at his activities before Chan left his city job. More recently, Chan has worked as a consultant with a firm called CCC Investment Group.

Asked if he was concerned that people he had appointed are named in the warrant, Garcetti told reporters, “I am not responsible 100% for everybody’s actions in this building, elected officials and staff. But I do take my responsibility seriously and expect every city employee to participate fully and cooperate fully with the FBI.”

Dan Schnur, who teaches political communications at UC Berkeley, said that, as it stands, the homelessness crisis and the Los Angeles Unified School District’s teachers’ strike are probably bigger challenges for Garcetti politically.

But Schnur said the investigation could become a distraction on the campaign trail, likening the situation to the questions that dogged former Florida gubernatorial candidate Andrew Gillum, who was mayor of Tallahassee as that city was the focus of an FBI probe.

Gillum “was never implicated in anything, but he had to answer questions about it all through the campaign,” Schnur said.

Wesson, who is running for a seat on the Los Angeles County Board of Supervisors, is also facing questions about his chief of staff, Deron Williams, who is named on the FBI search warrant. Asked Monday if he worried the FBI probe could become a distraction during his campaign, Wesson replied, “My concern is about the city of Los Angeles, not me personally.”

Wesson spoke briefly about the probe Monday during a speech at the Los Angeles Current Affairs Forum, telling the crowd he had been unaware of the newest revelations until they were reported in the media.

He refused to answer questions from the audience about Huizar, including whether he regretted putting him in charge of the committee that vets development projects.

Price, who represents part of South Los Angeles, also said he knew nothing about the federal warrant.

Among the records that agents were scrutinizing was a document that appeared to be a list of business deals for CCC Investment Group, the firm that has employed Chan, the former deputy mayor.

That document mentioned a China trip involving “CD9” — a common abbreviation for the 9th district Price represents. It also included a reference to “Del,” which is the first name of his wife.

Price spokeswoman Angelina Valencia said the councilman has no idea what that excerpt meant. No trips to China are being planned, she said.

Price has not spoken to investigators and is “not aware of any of the matters listed in the warrant,” but will cooperate with any investigation, Valencia added.

Jill Stewart, executive director of the Coalition to Preserve L.A., said it is still unclear how Price fits into the investigation.

Nevertheless, she argued that Price should voluntarily step off the committee that vets development projects “to make things as squeaky clean as possible.” Her group, which is critical of planning decisions at City Hall, has called for the county grand jury to investigate how “unusually large projects” are approved.

The information sought by the FBI — in some cases quite broad, in others extraordinarily specific — has troubling implications. The Google search warrant said investigators also were gathering information on bank accounts kept by Huizar relatives and possible hotel stays in Las Vegas.

Beyond the warrant, an as-yet-unknown number of real estate developers have received grand jury subpoenas seeking information on meals, gifts, travel and other freebies that may have been provided to Huizar, his staff and his colleagues on the council, according to sources familiar with the FBI instructions.

The FBI investigation could also affect politicians beyond City Hall. The Google warrant also named George Esparza, a former Huizar aide who now works for Assemblywoman Wendy Carrillo (D-Los Angeles). Esparza told The Times on Sunday that he stopped working for Huizar because he was “profoundly uncomfortable” with the councilman’s activities.

Carrillo told The Times that she trusts Esparza and has known him for 10 years. She said Esparza previously told her about the FBI probe and indicated that things “went on in the councilman’s office” — but he did not get more specific, Carrillo said.

“I’m confident that he’s dedicated to doing the work right now as my chief of staff and serving the constituents” of the assembly district, she said.

The probe could also help revive a proposal, long championed by Councilman David Ryu, to restrict political donations from real estate developers to city candidates. The plan was trumpeted by several council members two years ago as the city headed for a showdown over a ballot measure that would have cracked down on development.

But the plan languished at City Hall and was tabled by the Ethics Commission. Ryu said Monday that he plans to resurrect the idea.

Ryu said his new proposal will also seek to restrict “behested payments” — donations solicited by politicians for charities and other causes — from developers. Federal investigators examining Huizar have instructed developers to turn over information on donations they made to Bishop Mora Salesian High School.

The Times previously reported that Huizar had asked companies that do business at City Hall to donate to the school while his wife was working there as a paid fundraiser.

“This problem isn’t going away and it’s real,” Ryu said of the lack of public trust in local politicians. “We have to address this problem head-on.”

Times staff writers Dakota Smith and Doug Smith contributed to this report.

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