A real estate development consultant agreed today to plead guilty to a federal racketeering charge for his role in a wide-ranging "pay-to-play" scheme in which developers bribed a member of the Los Angeles City Council and other officials to help ensure the success of their projects.
The U.S. Attorney's Office said 41-year-old George Chiang of Granada Hills will plead guilty to one count of conspiring to violate the Racketeer Influenced and Corrupt Organization statute at a date to be determined. The charge carries a sentence of up to 20 years behind bars. A copy of the plea agreement can be viewed here.
Chiang is the third person to agree to plead guilty in the continuing federal public corruption probe of City Hall:
• Political fundraiser Justin Jangwoo Kim agreed in March to plead guilty to a single count of federal program bribery for facilitating a $500,000 cash payment to an unnamed council member.
• Former Councilman Mitchell Englander will plead guilty to engaging in a scheme to deceive the FBI, related to his cover up of cash payments and other gifts offered from a Los Angeles businessperson. The 49-year-old Santa Monica resident entered into his plea agreement on March 27.
Kim is scheduled to enter his plea on June 3, and Englander is set to plead guilty the next day in Los Angeles federal court.
Chiang, like Kim, agreed to fully cooperate in the government's ongoing investigation into political corruption in downtown Los Angeles, according to the U.S. Attorney's Office.
In court documents filed Wednesday, Chiang admitted that he participated in a criminal enterprise called the Council District A Enterprise, or CD-A Enterprise.
The scheme was led by a member of the City Council and involved people engaged in bribery and honest services fraud designed to enrich themselves, to conceal their activities from authorities and the public, and to maintain and advance their political power, prosecutors allege.
Prosecutors allege the public officials involved in the CD-A Enterprise received cash; consulting and retainer fees; political contributions; tickets to concerts, shows, and sporting events; and other gifts in exchange for affecting the success of development projects.
In early 2014, Chiang was a real estate broker who was recruited by "Individual 1" -- a longtime employee of the city who eventually became the Deputy Mayor for Economic Development -- to be a consultant who would interface with Chinese companies that were developing real estate projects in Los Angeles, according to court documents.
Who is Councilmember A?
As he started providing consulting services, Chiang became a close political ally of "Councilmember A," who was a member of both the Planning and Land Use Management Committee and the Economic Development Committee, documents show.
The L.A. Times reports that details from the investigation indicate that the council member in question is Jose Huizar, whose District 14 stretches from Eagle Rock to Downtown. Huizar's home and City Hall offices were raided by the FBI in November 2018 but no charges have ever been filed against the Boyle Heights resident. An attorney for Huizar declined to comment, the Times said.
Chiang also became a close ally of Councilmember A's special assistant, and through those relationships, developed a business relationship with Kim, a fundraiser for Councilmember A.
"Members and associates of the CD-A Enterprise conspired with one another to facilitate bribery schemes that would provide Councilmember A and other city officials financial benefits and keep members in power to maintain the CD-A Enterprise's political stronghold in the city," according to Chiang's plea agreement.
"In exchange, Councilmember A, Individual 1, and members and associates of the CD-A Enterprise, would take official action to ensure certain development projects and CD-A Enterprise associates received favored treatment from the city and thereby secure their bribe-financed influence," the document states. "In addition, members and associates of the CD-A Enterprise sought political contributions from developers and their proxies (lobbyists, consultants, etc.) to benefit Councilmember A and his allies in exchange for official acts to benefit those developers and their proxies, including defendant Chiang."
Chiang's plea agreement contains a 22-page "factual basis" that details certain activities of the CD-A criminal enterprise. According to that document, Councilmember A accepted bribes from "Company D," a China-based real estate development company, which employed Chiang as a consultant.
Among other things, Company D funneled $66,000 to an associate of Councilmember A and pledged $100,000 to a political action committee to benefit a relative of Councilmember A running for the CD-A seat on the council. In exchange, Councilmember A filed motions and voted to approve Company D's "Project D" at city hearings.
In addition, Chiang agreed to pay Individual 1 a share of the lucrative consulting proceeds he received from Company D in exchange for Individual 1 shepherding Project D through the approval process in Individual 1's capacity as Deputy Mayor, according to the plea agreement.
Individual 1 directly and indirectly accepted more than $100,000 from Chiang for assisting in obtaining approvals for Project D, including by exerting pressure on other City officials who could influence the project's success, according to court documents.
In his plea agreement, Englander admitted obstructing a probe related to his acceptance of gifts -- including cash, hotel rooms and expensive meals -- from a developer during trips to Las Vegas and Palm Springs in 2017.