Owned by fugitive billionaire Huang Wei, the company showered Huizar with dirty cash, prosecutors said
A Chinese real estate company was convicted on Thursday, Nov. 10, of federal charges of bribing former Los Angeles City Councilman José Huizar with cash and gambling trips in exchange for his support in getting approval for a towering downtown L.A. skyscraper.
Shen Zhen New World I, owned by fugitive developer Wei Huang who fled to China, faces millions of dollars in fines in its sentencing at Los Angeles federal court on Jan. 23, 2023. Jose Huizar faces trial next February on federal bribery and fraud charges.
A Los Angeles federal jury on Thursday found Shen Zhen New World I guilty of eight counts including honest services wire fraud, interstate and foreign travel in aid of bribery, and bribery concerning programs receiving federal funds.
Federal prosecutors have convicted nine defendants as a result of “Operation Casino Loyale,” a broad corruption investigation into Los Angeles City Hall by the FBI and the U.S. Attorney’s Office.
A thick trial memo written by federal prosecutors recently unveiled dramatic new fireworks, alleging that Huizar was so entangled with Huang that he traveled with the billionaire Huang to Las Vegas 19 times.
Billionaire Huang planned to build a 77-story tower on the site of the L.A. Grand Hotel downtown, and federal prosecutors said the company bribed the ex-councilman to smooth the way. Prosecutors said Huang allegedly gave Huizar $1.5 million, including $250,000 in casino chips and a loan which Huizar never paid back.
An earlier conviction in June involved real estate developer Dae Yong Lee and one of his companies, found guilty of federal criminal charges for allegedly providing $500,000 in cash to Huizar and his special assistant in exchange for their help in resolving a labor organization’s appeal involving a downtown Los Angeles development project.
Devastating testimony in recent days by Huizar’s estranged wife, Richelle Rios, detailed her suspicion that her husband was involved in an extra-marital affair, and in August 2013 she learned that Huizar was being sued by a former aide alleging sexual harassment. The woman sought between $600,000 and $1 million to settle with her ex-boss, Rios said.
Because Huizar was about to run for his third and final four-year term on the Los Angeles City Council — and news of the lawsuit could potentially torpedo his campaign — Huizar and his associates were worried, Richelle Rios testified.
Rios, who did not face charges, said she was called to a meeting with her husband, and then-Deputy Mayor Raymond Chan who is also accused of wrongdoing, and billionaire Huang — known in Huizar’s circle as “Chairman Huang.”
The topic of the meeting: How Huang could “help in resolving the lawsuit,” Rios testified.
“They wanted to know if I was going to stay in the marriage and would I stand with (Huizar),” Rios, 53, told the jury.
She said she felt “humiliated, angry and devastated” about the situation, but agreed. Huizar was able to privately resolve the suit and was re-elected.
Around that time, Huizar began traveling with Huang to Las Vegas and elsewhere on private jets for weekend gambling trips, Rios said.
After one such trip, Rios testified, she found “a stack of cash” in hundreds at their home. She attempted to speak to her husband about it, but the conversation quickly turned “unpleasant,” she told jurors. Another time, she said, she found a wad of hundred-dollar bills about an inch thick hidden in a traveler’s belt in a pocket in one of Huizar’s suits.
Opening statements began Thursday, Oct. 27 in the federal trial against Huang’s company and ended on Nov. 10 with his company found guilty.
The government’s trial memorandum, filed with the U.S. District Court on Oct. 17, outlined the evidence federal prosecutors presented. The case included voluminous records, and the new details alleged that the relationship between the powerful council member and the powerful billionaire was significantly closer than previously reported.
A federal prosecutor told the jury that the China-based hotel company owned by Huang provided Huizar with over $1 million in bribes, trips on private jets and “casino chips and prostitutes” in exchange for his official support of a downtown L.A. skyscraper project.
Huang wanted to build the tallest skyscraper on the West Coast at West 3rd and Figueroa streets, where the Huang-owned Grand Hotel still stands.
The defense said that L.A. city officials “universally loved” Huang’s proposed project, so “there was no reason to bribe anyone” to approve it.
Shen Zhen New World I was charged by the Department of Justice with interstate and foreign travel in support of bribery, devising and participating in a scheme to defraud the city of Los Angeles and to deny its citizens of Huizar’s honest services.
The trial offered a glimpse into the alleged criminal relationship between the billionaire real estate developer and the high-rolling former councilman, whose District 14 included much of downtown and is now represented by Councilman Kevin de Leon who, himself, is caught in a more recent City Hall scandal.
Loyola Law School professor Jessica Levinson, who served on the L.A. City Ethics Commission, said earlier during the trial that federal prosecutors were trying to present evidence showing that Huizar had a relationship with the billionaire real estate developer that stretched well beyond what has previously been reported.
“I think what (federal prosecutors) are really trying to show is closeness and coziness and the possibility of favors and favoritism and preferential access,” Levinson said.
Representatives for Huizar and Shen Zhen New World I didn’t respond to multiple requests for comment during the trial.
Huang, who also maintains a residence in the upscale San Gabriel Valley suburb of San Marino, did not appear in court before he vanished, according to Thom Mrozek, a spokesman for the U.S. Attorney’s office, who added that charges against Huang will remain pending.
“It will be a criminal trial, and it’s just (that) the defendant is a corporate entity,” Mrozek said in late October. “You can’t put a corporate entity in prison, but you can — if it’s convicted — obtain another sanction against it like probation, court supervision, fine and restitution.”
On the opening day of the trial, federal prosecutors said that Huang allegedly provided Huizar and his special assistant George Esparza with a “lineup of prostitutes for their choosing” during the trips, adding that “It would become a recurring theme of their trips together.”
Prosecutors alleged that Huang’s company provided Huizar with casino gambling chips cash, flights on private jets, lavish meals and trips to Las Vegas. In exchange, prosecutors alleged, Huang expected Huizar to hurry the city approval process for his L.A. Grand Hotel commercial and residential project.
“The stream of bribes turned into a flood” as Huang lavished Huizar with gifts, including a 10-day trip to Australia, visits to golf resorts, luxury suites, cash and private gambling in Las Vegas hotels, Assistant U.S. Attorney Patrick Castañeda alleged.
According to the prosecutor’s troubling memo released before the trial began, Huizar used his own family members to allegedly launder bribes that prosecutors claim Huizar got from Huang.
“Huizar consistently concealed the benefits he received, and his relationship with Mr. Wei Huang tends to demonstrate that Huizar understood that the money he received was for a corrupt purpose,” the federal prosecutors’ memo said.