LOS ANGELES — City watchdogs have been chomping at the bit for an outcome to the FBI raids that descended on the Los Angeles City Hall office and home of 14th District Councilman Jose Huizar back in November 2018.
Nearly 1.5 years later, Huizar has not been charged with any crimes. He was stripped of his committee assignments, including his seat as chair of the powerful Planning and Land Use Management committee, but continues to collect an annual salary of more than $200,000. There have been calls for his resignation ever since the raids.
The tide may finally be turning.
Despite the COVID-19 pandemic, federal authorities are blazing forward in that wide-ranging probe. In March, prosecutors with the U.S. Attorney’s Office began to publicly charge some periphery figures in what they’re calling a series of pay-to-play schemes involving city officials and real estate developers seeking to build costly residential and commercial properties throughout L.A.
The first formal charges to drop were against former 12th District councilman Mitchell Englander. Prosecutors allege he obstructed a federal investigation into his relationship with a Los Angeles businessman who allegedly supplied Englander with cash, an escort, and a posh night out in Las Vegas.
ENGLANDER SCANDAL
Details of the Las Vegas trip are detailed in an indictment that charged Englander with seven federal obstruction counts: one count of participating in a scheme to falsify material facts, three counts of making false statements, and three counts of witness tampering.
Prosecutors say Englander accepted the Vegas trip from “Businessperson A” in June 2017 and was accompanied by Councilman John Lee (who at the time served as Englander’s staffer), a lobbyist, a real estate developer, and another city staffer. During the trip, the businessman turned over an envelope containing $10,000 in cash to Englander.
Court documents reveal the man also gave Englander $1,000 in casino gambling chips, $34,000 in bottle service at a nightclub and spent $2,481 on dinner at a restaurant. When the group returned to the hotel, the man ordered female escorts, paying $300 to $400 in cash for their services, according to the indictment.
Assistant U.S. Atty. Mack Jenkins told U.S. District Judge John F. Walter during Englander’s first court appearance that prosecutors believe the businessman, who owned companies that sold cabinetry and smart-home automation, plied Englander with gifts to be connected with real estate developers to sell his products. The businessman also allegedly used his largesse to “groom and cultivate” other city officials.
At first, Englander pled not guilty to the charges. But just a few weeks later he reversed his position in a plea agreement, and his defense attorney, Janet Levine, released the following statement:
"Mitch accepts full responsibility for his actions and is contrite and embarrassed by his conduct. With the help and support of his family and friends, he will continue to move forward and look for new ways to contribute to his community."
WHO IS "BUSINESSPERSON A"?
Prosecutors revealed in court that Englander documented a gift of $250 in food and beverages from the businessman on his 2017 Form 700 public disclosure record filed with the city’s Ethics Commission.
The form shows Englander received a $250 gift on June 1, 2017 from a man named Andrew Wang. Business records obtained by Spectrum News 1 show Wang operated a home tech company called Arrow Technology Corp out of Montclair, Calif. until 2018.
Current filings show he heads up companies including Arrow Pacific Electronics Corp., Arrow Recovery Group, Arrow United Refining Corp., NextData Automation, Inc. In 2019, Wang canceled and/or dissolved companies called Arrow United Investment, LLC and a construction company called Wang Construction Corp.
Calls by Spectrum News 1 to Wang and his listed companies have not been returned.
City campaign contribution records also reveal Wang donated to several political campaigns, including those of Mayor Eric Garcetti, Englander, and 15th District councilman Joe Buscaino.
A POLITICAL FUNDRAISER CHARGED AND COOPERATING
Just weeks after Englander was charged, federal prosecutors dropped a plea agreement between Mar Vista political fundraiser and real estate appraiser named Justin Jangwoo Kim.
Kim agreed to admit to one count of federal program bribery for his role in facilitating a $500,000 payment from a real estate developer to a city councilman, identified only as “Councilmember A,” to help clear the way for a major development project in the councilman’s district.
Court documents state that the alleged bribery scheme began in September 2016 when Kim met with “Councilmember A,” a city staffer for the councilman, and “Developer C” at a karaoke bar in Los Angeles. Kim asked the councilman for his help resolving an appeal that had been filed against “Project C” being proposed by the developer in the councilman’s district.
The councilman said he would not help for free, according to federal prosecutors. When the developer learned it would cost up to $1.4 million to hire a lobbyist to resolve the appeal, which had been filed by a labor organization, the developer offered to pay “Councilmember A” $500,000 via Kim. The councilman would keep $300,000 of the bribe.
Spectrum News 1 dug through publicly available city records to find plans for a mixed-use development at 940 South Hill at the corner of Hill Street and Olympic Boulevard.
Dubbed “The Hill,” the project was proposed as a 420,000 square-foot, 20-story condo and retail development designed with 230-plus units, 14,000 square feet of ground-floor retail space, and a massive parking garage. A rendering can be found on the website of architecture firm DGB Line.
Who are the developers? Records show 940 South Hill was purchased in 2008 by a company called 940 Hill LLC. Business filings with the state of California show the officers of the DTLA-based company are Dae Yong Lee, Jeong Suk Kim, and Hyuk S Lim. Calls and emails to the company, its accountant Henry Kim, and its members were not returned.
THE APPEAL THAT WAS... UNTIL IT WASN'T
In August 2016, the proposed development was appealed by a Los Angeles labor coalition called Creed LA, which requested all activity on 940 South Hill be suspended until the project was brought into CEQA compliance. That appeal was withdrawn in March 2017 by its executive director, Jeff Modrzejewski for unknown reasons.
What we do know, according to Kim’s plea agreement, is at some point between February and March 2017, Councilmember A conveyed to a lobbyist, referred to as “Lobbyist C,” that the appeal would be opposed in the city’s Planning and Land Use Management Committee. Lobbyist C then agreed to talk the matter over with the executive director of the labor organization.
Calls and emails to Creed LA and Modrzejewski were not returned. Spectrum News 1 tried to stop by the Koreatown office address listed for Creed LA, which was closed. Interestingly, the office is located across the street from the address listed for the architect of 940 South Hill, DGB Line.
City watchdogs may recognize the Modrzejewski name. Jeff’s brother, Chris Modrzejewski, is a powerful lobbyist with deep ties to city hall. He owns lobby firm M Strategic Advisors and serves as principal of adjacent public affairs firm M Strategic Communications. Prior to his private sector experiences, Chris Modrzejewski worked for former Los Angeles Mayor Richard Riordan and has also served as a spokesman for the Department of Water and Power’s union.
The city of Los Angeles restricts campaign contributions to council members from registered lobbyists and bidders for city projects. But Ethics Commission documents reveal Chris’s wife, Denise Modrzejewski, and both of Chris's brothers, Jeff and Matt, are frequent political donors.
Collectively, the Modrzejewski family has offered tens of thousands of dollars in contributions to the campaigns of nearly every member of city council, including Mayor Garcetti, City Council President Nury Martinez, Englander, Huizar, and Lee.
Brother and political donor Matt Modrzejewski serves as the Director of Land Development for California Home Builders. His biography on the company’s website states he once worked under former L.A. Mayor James Hahn in the Office of Management and Budget.
Messages left with the Modrzejewskis have not yet been returned. Sources who asked not to be named but are familiar with their dealings in city hall referred to them “movers and shakers” and “heavy hitters.”
IS HUIZAR “COUNCILMEMBER A”?
The proposed development project at the center of the bribe involving Justin Kim is located in City Council District 14, which Jose Huizar currently represents.
But another clue pointing to the likelihood of Huizar’s impending identification as “Councilmember A,” surrounds a plan laid out in Kim’s plea agreement to help the relative of “Councilmember A” get elected to City Council because the official’s term was expiring. The purpose was “ensuring political control for them and their allies,” according to federal prosecutors.
Huizar spent much of 2018 working to get his wife, Richelle Huizar, elected to his seat. She dropped out of the race after the couple’s home was raided by the FBI.
Federal prosecutors reveal in June 2017, Kim met with the councilmember, his staffer, and a “Lobbyist B” to discuss establishing a pair of PACs, political action committees, to raise money for the official’s relative. Kim was tasked with finding an associate to serve as a “face” for one of the PACs to disguise the councilmember’s involvement, according to court documents.
In 2019, the LA Times reported that real estate developers in Huizar’s district had received federal grand jury subpoenas instructing them to turn over information on any contributions made to two PACs with ties to Huizar and his wife, Community Support PAC and Families for a Better Los Angeles. The Times went on to report the principal officer for Families for a Better Los Angeles was longtime lobbyist Morrie Goldman, who was also asked to provide records on activities with his Huizar.
It’s important to note that subpoenas are routinely issued because investigators are seeking information and do not necessarily mean that the recipients or those mentioned in them are targets of a particular probe.
TIP OF THE ICEBERG
The court records currently available do not identify any city officials beyond Englander, the lobbyists, city staffers, or the developers allegedly involved in the public corruption schemes, though many speculations are now swirling.
During the 2018 FBI raid, a search warrant seeking evidence related to the probe into possible bribery, kickbacks, extortion, and money laundering revealed more than a dozen names authorities were seeking information on, including:
City Officials
- Raymon Chan, former Deputy Mayor for Economic Development and former head of the L.A. Department of Building and Safety
- Councilman Jose Huizar (D-14)
- Shawn Kuk, Planning Director for Councilman Huizar
- George Esparza, former aide to Huizar who now serves as Chief of Staff for Assemblywoman Wendy Carillo
- Councilman Curren Price (D-9)
- Deron Williams, Chief of Staff to Councilman Herb Wesson (D-10)
- Joel Jacinto, a former Garcetti appointee who served on the city’s Board of Public Works
- Lincoln Lee, former Chief of Department of Building Safety’s Code Enforcement Bureau
Developers
- Wei Huang, president of Shenzhen New World Group
- Ricky Zheng, executive at a Shenzhen New World LLC
- Fuer Yuan, founder of Shenzhen Hazens Real Estate Group Company Limited
- Mason Situ, general manager at Shenzen Hazens
- George Chiang, a consultant for the owner of the Luxe City Center Hotel
The search warrant also requested the financial records of Huizar, his mother and his brother, as well as fundraising expenditures/campaign contributions, involving Huizar’s alma mater, Salesian High School (which employed Richelle as a fundraiser) and Proposition HHH, the city’s $1.2 billion affordable housing bond program.
Huizar’s attorney Vicki Podberesky declined our request to sit down with the councilman.
“Neither our firm nor Mr. Huizar will be answering any questions or sitting for interviews at this time,” Podberesky wrote in an email.