Courthouse Bombshell: LADBS General Manager Ray Chan assembled an "A-Team" of retired government officials to grease the development wheels in City Hall

Gentle reader,

The Los Angeles Times is dead to us, and it ought to be to you.

There was nobody from that shell of a newspaper in the new Federal Courthouse across from its historic HQ in Downtown Los Angeles this afternoon when we returned to catch the afternoon session of Day 7 of Ray Chan’s public corruption trial. In fact, there was not a single observer for some of the most shocking testimony imaginable.

On the stand, already deep in his testimony, was George Chiang, the San Gabriel Valley real estate agent who had been tapped by his kung fu master Ray Chan to be the face of the illegal development consulting business, Synergy Alliance, that Chan launched while still employed by the City of Los Angeles.

Like councilman Jose Huizar’s toady George Esparza before him, this cooperating witness had a lot to say—his story gushed out like a firehose, in detail rich, narrative style testimony, as opposed to spare answers to the government’s questions. Chiang is tall and lean, balding, with delicate features and a slightly accented, baritone voice.

At the defense table, Ray Chan was leaning forward making notes, his smile stapled on.

Listening from the jury box was a depleted pool: Juror #6, a stocky, bearded young man who had appeared quite interested in the case was dismissed yesterday, replaced by Alternate #1.

Up on the screen was a text message from Jose Huizar dated 12/12/2016, assuring Chiang that City Council would vote on the motion to accept the TOT deal tomorrow, and it should be fine. Huizar followed up to say that he wanted to talk later about the Hazens project’s 1) development agreement and 2) affordable housing.

Referring back to historic City Council agendas, we find at #39 the motion that Huizar referenced is Council File 16-1323, authored by Huizar and seconded by recently indicted Curren Price. The motion instructs the highest levels of the Los Angeles City Attorney and Chief Legislative Analyst’s offices to get moving to ensure Ray Chan’s Chinese billionaire client Chairman Fuer Yuan got all he asked for his Luxe Hotel project.

The Chairman was getting his bribe money’s worth, too. We track a lot of council files, and anything worth doing—like saving a cool old building or creating tools to combat illegal Airbnb listings or protect tenants from harassment or eviction—lingers for months or years in committee, often until it expires.

Not the Luxe Hotel development scheme! Greased with expensive dinners, hookers and Katy Perry tickets, Jose Huizar instructed his team to put this motion on the fast track.

CF 16-1323: Luxe Hotel Project / Jia Yuan USA Co. Inc. / Economic Development was introduced on 11/22/2016 and on 12/05/2016 it was waived out of the Economic Development Committee. The very next day, 12/06/2016, the City Clerk scheduled the item at full City Council for 12/13/2016. One week later, it was law.

The motion was unanimously adopted 14-0 at that meeting—14 rather than 15 because the councilman for District 7, Felipe Fuentes, had resigned in September, ten months left in his term, ostensibly to become a lobbyist in Sacramento. We’ve always wondered if Fuentes got spooked by the unfolding public corruption investigation and decided to make himself scarce. The timing certainly is interesting.

We know how the vote went down from the dry Council File. But turn to video from the hearing, and here’s City Hall gadfly John Walsh, calling the bizarre Luxe Hotel deal, in which the foreign property owner Chairman Fuer Yuan paid the city to do his project analysis, out explicitly as a bribe! (If the item was actually discussed and received a public vote, we have failed to find it in the automated YouTube transcript or from scrolling through the video. If anyone reading this spots it, please tell us the time stamp where you did.)

We wish we could ask how he knew the project was dirty, but John Walsh is dead, terrorized at the end of his life by efforts to evict him and all his neighbors from their rent controlled apartment building at Yucca and Argyle in Hollywood. The consultant doing that ugly work? Del Richardson, wife of indicted councilmember Curren Price, co-author of the very motion that John described as a bribe. The buildings were sold for $17 Million barely one year after he made this public comment.

We could go down similar rabbit holes with much of George Chiang’s testimony, comparing dates of incriminating text messages with public hearings and votes, but we expect the government will be doing that in their closing arguments. So let’s wrap up with some fun facts and a jurors’ belly laugh.

We heard about Jose Huizar’s willingness to approve any and all signage permits that Hazens wanted near L.A. Live—just tell him what they need and the answer was yes, Chairman.

We heard that Kevin Keller, current Senior Advisor in the Mayor’s Office who is the architect of Karen Bass’ disastrous and dangerous ED 1 development policy and whose testimony we missed earlier in the week, attended Ray Chan’s weekly planning meeting as a representative of Mayor Eric Garcetti’s office.

We heard that Jose Huizar was dragging his feet, but finally arranged for a requested dinner meeting between Chairman Fuer Yuan, Council President Herb Wesson and himself in May 2016.

We heard that much of the conspiracy was planned out at Ray Chan’s home in Monterey Park following twice weekly kung fu practice. There would be a work out, private discussion of pending votes and bribe solicitations, then often they’d go out and get something to eat. Yum.

And we heard a new name, Lincoln Lee, who had worked under Ray Chan at the bribery plagued LADBS and retired early to join Chan’s illegal secret consulting firm, Synergy Alliance.

Lee had useful skills, had worked the lecture circuit with his boss, and he knew the drill. When George Chiang texted frantically instructing that Lee not mention Chan in a group text with the Mayor’s man Kevin Keller included, Lee replied “Good cover up… u fool me too.”

And in explaining the role Lincoln Lee played in Synergy Alliance, Chiang earned the first laugh we’ve heard in this very tense and intense trial, and it was a hearty one. Lee had “joined the A-Team!” Asked to explain, Chiang went on, “This is the group of retired city staff who all had a relationship with Ray’s brothers. Ray pitches these people as—I think there was a TV show in the ‘80s—he pitches these people as a group who can solve any problem in the city.”

Was Kevin Keller from the Mayor’s Office part of the A-Team? No, Chiang scoffed, “Kevin Keller influences the project, but he is not on the A-Team!”

And that’s when Jurors 1 and 2, perhaps picturing mousy Ray Chan sporting Mr. T’s signature mohawk, started cracked up.

And here, Judge Walter called it a night, just after 2pm. The jury was dismissed, and George Chiang told he could go, too. The judge noted that his court reporter was also gone, and that he wanted opposing counsel to confer on several new jury instructions and exhibits.

Then, he addressed the prosecutors: “There has been some discussion of the government preparing a trial indictment. Does the government intend to do that?”

Assistant U.S. Attorney Susan S. Har answered, “We will discuss and let you know promptly.”

We don’t know what a trial indictment is, but it sounds ominous. And we asked around, and our courthouse pals don’t know either.

Maybe if there had been an experienced legal reporter present, we could read an explanation in the evening newspaper. Instead, we’re sitting up late telling you about the real life noir unfolding in an empty courtroom just kitty-corner from Los Angeles City Hall, and planning to return early tomorrow, because this is important, nobody else is doing it, and it appears there are a lot of dirty folks still working in City Hall.

What’s next? George Chiang is back on the stand for another 3-4 hours of direct testimony, followed by smart appliance company owner Andy Wang, who wore a wire. Jose Huizar’s planning director Shawn Kuk is no longer scheduled to testify, darn it, but the FBI’s Andrew Civetti is expected to describe a bribe Kuk took to benefit the Arts District Center project—unless Ray Chan’s defense attorneys can convince the judge that Civetti has said enough. Stay tuned!

Yours for Los Angeles,

Kim & Richard

Esotouric

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