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San Francisco Metropolis Corridor corruption scandal: New costs in opposition to Harlan Kelly, Victor Makras

The federal prosecutor’s office on Tuesday added new bank fraud charges against him and prominent real estate investor Victor Makras to the corruption case against former top San Francisco public utility official Harlan Kelly.

The new charges came from a $ 1.3 million real estate loan that Kelly, the former general manager of the San Francisco Public Utilities Commission, allegedly secured from a company called Quicken Loans, according to prosecutors.

Prosecutors say Kelly and Makras conspired to defraud the company by agreeing to falsely increase the amount Kelly Makras owed on a previous loan. This enabled Kelly to get more money from Quicken Loans at a lower interest rate.

Kelly then allegedly used the funding to pay off other debts.

The charges are part of a wider FBI investigation into corruption in San Francisco City Hall.

This is the second round of charges against Kelly and the first against Makras. Makras is the director of Makras Real Estate and has served on various boards including the Port Commission and the Public Utilities Commission.

Kelly was first implicated in the scandal last November when US prosecutors charged him with fraud on allegedly taking bribes from businessman and license accelerator Walter Wong.

In the earlier complaint, prosecutors said Wong paid Kelly and his wife, former city manager Naomi Kelly, to take a vacation to China in 2016.

In return, Harlan Kelly allegedly used his position to help Wong land a lucrative contract to modernize the city’s streetlights. While Wong ultimately didn’t win the contract, prosecutors said Kelly smoothed the bidding process for him.

These allegations are based in part on statements Wong made to federal authorities. He agreed to join the investigation when he pleaded guilty of fraud and money laundering in July 2020.

Both Kelly and his wife have since resigned, pleading their innocence. Naomi Kelly was not charged.

“Harlan Kelly is loved by his family, respected by our community, admired by his peers, and has served as a loyal civil servant,” wrote attorney Brian Getz in an email to The Examiner. “He has not committed any crimes.”

A Makras attorney did not immediately respond to a request for comment.

Kelly is on trial today. Wednesday mornings. A date for the appearance of makras has not been set.

mbarba@sfexaminer.com

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