"Operation Casino Loyale": Developers, ex-LA deputy mayor indicted in Huizar corruption scandal | The Real Deal Los Angeles Raymond Chan, Shenzhen New World Indicted in Jose Huizar Case
Tuesday 1st December 2020
Real estate developers and a former Los Angeles deputy mayor have been charged in the two-year-long corruption case centered around ex-L.A. City Council member Jose Huizar.
On Monday, a federal grand jury indicted China-based Shenzhen New World Group and its chairman Wei Huang, along with Bel Air-based developer Dae Yong Lee and a Lee incorporated firm, 940 Hill LLC, on racketeering charges tied to the Huizar case. It marks the first time developers have been indicted in the pay-to-play probe.
Raymond Chan, the former L.A. city deputy mayor for economic development, was also indicted.
As part of the probe, prosecutors allege Huizar associates illegally received cash bribes and other payoffs from developers who sought favorable treatment on real estate projects.
Federal authorities have now brought charges against a total of nine individuals in the ongoing corruption investigation into L.A. City Hall, an effort that prosecutors dubbed "Operation Casino Loyale."
A different developer, Shenzhen Hazens -- also based in China -- admitted to bribery allegations in October, but avoided criminal prosecution by agreeing to pay a $1 million fine.
U.S. Attorney Nick Hanna on Monday said, "the scope of corruption outlined in this indictment is staggering." In a statement outlining the latest indictment, Hanna said "Huizar, Chan and their network of associates repeatedly violated the public trust by soliciting and accepting numerous cash bribes and other financial benefits, turning Huizar's City Council seat into a money-making criminal enterprise. Powerful developers, operating through well-connected lobbyists, eagerly participated in the schemes to get preferential treatment for their downtown projects."
Hanna added that the "backroom deals" the indictment lays out "should prompt a serious discussion as to whether significant reforms are warranted in Los Angeles city government."
Each of the individuals and companies named Monday have long been tied to a criminal probe against Huizar, which came to light when the FBI raided Huizar's home and office in November 2018.
Authorities say Huizar and Chan operated the "CD-14 Enterprise," named for the Council District Huizar represented for 15 years until this year. Prosecutors say enterprise members illegally solicited political contributions by foreign nationals.
Federal agents arrested Huizar, the former chairman of the Council's Planning Land Use and Management Committee in June, and have charged him with 34 criminal counts related to racketeering and fraud. His trial is expected to start in June 2021.
He has maintained his innocence, and Lee previously denied wrongdoing. Huang and Shenzhen New World have not commented on allegations.
Huizar is charged with accepting $1.5 million in bribes from the real estate industry in exchange for approving projects that would remake L.A.'s downtown.
Those projects included Shenzhen New World's plans to transform the L.A. Grand Hotel Downtown into a 77-story tower. Wei Huang allegedly provided Huizar over $500,000 so the Council member could settle a sexual harassment lawsuit. In exchange, Huizar shepherded the project -- set to be the tallest building west of the Mississippi River -- through city approval.
Both Wei Huang and his company face charges of bribery and fraud. Federal prosecutors call Wei Huang a billionaire. He resides in China and San Marino, California. A warrant has been issued for his arrest.
Lee and 940 Hill LLC also face bribery and fraud charges. The developer is accused of providing Huizar $500,000 in order to quell labor opposition to his planned project at 940 Hill Street in Chinatown.
Chan's charges include facilitating a $100,000 bribe from Shenzhen Hazens to Huizar.
Chan and Lee have been ordered to surrender to federal authorities, and are expected to appear in court on Tuesday. The companies, Shenzhen New World and 940 Hill, have court dates on Dec. 7, the same day Huizar is expected to be arraigned.