The company run by Chinese billionaire Zhang Li will have to pay a $1 million fine after a sentencing in federal court Thursday. Representatives for the firm pleaded guilty to conspiracy to commit fraud for its part in bribing ex-San Francisco Public Works head Mohammed Nuru to get approvals for a major development project in the city. 

The sentence, which also requires Z&L Properties to enter into a corporate compliance program designed to prevent corruption, stems from a yearslong international saga in which real estate mogul Zhang was first arrested in London and fought extradition to the United States. 

After an extended legal battle, Zhang agreed to be extradited to San Francisco in July, where he confessed to bribing Nuru in exchange for the U.S. Department of Justice agreeing to drop the charges against him personally in three years. That month, prosecutors filed criminal charges against Zhang’s California company, Z&L Properties. The business agreed to plead guilty and pay the $1 million fine as part of Zhang’s deal.

Zhang is just one of more than a dozen powerful public officials and business executives who have been charged in a federal probe into San Francisco corruption. Others who bribed Nuru ended up in federal prison, including Alan Varela, who received a two-year sentence, and Florence Kong, who was sentenced to one year of incarceration. Zhang’s deal, however, required no prison time, and he returned to China immediately after his lone appearance in federal court this summer, his attorney previously told The Standard.

Before accepting the fine prosecutors offered to Zhang, Judge William Orrick questioned the impact it would have on the fabulously wealthy Zhang.

“He could pay $1 million, and it’s just money off his back,” Orrick said.

In response, prosecutor David Ward argued that Zhang’s punishment included four days in custody and seven months of house arrest in the United Kingdom before he was extradited, and that the U.S. Justice Department was seeking the “maximum fine.”

Orrick, in the end, accepted the sentence.

“If I keep my blinders on to what this company is charged with and did, I think it’s more than fair,” Orrick said.

Jennifer Lewis, a resident of one of Z&L Properties’ San Jose developments where residents have feuded with the company, saw the $1 million fine as low given the billions Zhang’s company is worth. 

“It seems fairly inconsequential for the scope of what he would be willing or able to pay out today,” she told The Standard.

The China Trip

At the center of both the cases against Zhang himself and his company is a lavish 2018 trip in China that Nuru took at Zhang’s expense, according to the agreement the business tycoon signed with prosecutors. As part of that agreement, Zhang admitted to paying for Nuru’s luxury hotel, transportation, services at a hot spring and numerous gifts totaling $6,500.

Prosecutors have further alleged that the trip featured a $10,000 bottle of liquor shared over dinner with the vice president of a foreign country.

Mohammed Nuru, then-director of Public Works, speaks on the steps of City Hall during a rally in 2019. | Source: Lea Suzuki/The San Francisco Chronicle via Getty Images

Zhang treated the powerful public official to that trip, and regular dinners in San Francisco, so that Nuru would help usher along Z&L Properties’ high-profile development project at 555 Fulton St., he admitted in the agreement. 

On Dec. 3, 2019, Zhang messaged Nuru via WeChat, according to a transcript in the agreement.

“How are you doing, Bro, 555 Fulton project has finished almost all inspection and have signed off plumbing & electrical & SFFD inspection for South Tower,” the business mogul wrote. “Can you please help to arrange inspection ASAP? Thank you very much Bro!!”

Nuru quickly replied: “No problem, will make sure you get all your sign off,” promising to make a call and get an update for the tycoon. Nuru followed up two days later, writing that paperwork had been signed for the building.

The development at 555 Fulton St. is at the heart of the bribery scandal. | Source: Liz Hafalia/The San Francisco Chronicle via Getty Images

Zhang’s Guangzhou-based company, R&F Properties Co., has assets topping $53 billion, according to Forbes. He first purchased 555 Fulton St. in 2012, and in 2016, he formed the Foster City-based company Z&L Properties to manage that project and others in California.

Nuru pleaded guilty in 2022 to a slew of corruption charges reaching well beyond Zhang’s case. He’s currently serving seven years in prison.

A Series of Troubled Properties

Z&L Properties’ other developments have faced serious problems, The Standard found. In August, San Jose Mayor Matt Mahan criticized the company for allowing a historic downtown church in the city to languish in disarray for years, earning it the name “Trash Bag Church.”

“Those responsible for this neglected, frankly dangerous, building have not done their part,” Mahan said about Z&L Properties’ management of the church.

The company is also in a prolonged feud with the owners of apartments in its 188 W. St. James St. development in San Jose. That owners’ association accused Z&L Properties of insurance fraud in a letter to the federal court overseeing the criminal case. The company filed for insurance reimbursements of over $138,000 for a window that actually cost about $10,000, the letter claims. 

The owners association also accused Z&L Properties of failing to pay dues it owes for the maintenance of communal spaces in the building in a letter to the court, stating that homeowners have recorded 10 liens on units the company owns within the development over the delinquent payments. Meanwhile, Z&L Properties controls the communal funds and has spent some of the money collected from 188 W. St. James St. residents to pay for PG&E bills at another building, the letter claims.

The condo towers at 188 W. St. James Street in San Jose are owned by Z&L Properties. | Source: Jim Gensheimer for The Standard

Attorneys for the owners association asked the court to disqualify Z&L Properties from serving on any building board, including at 188 W. St. James St.

“These financial criminals should not be permitted to continue handling the money of others,” attorney Maria Kao wrote in the letter.

Thursday’s final sentence, however, did not include the owners’ association’s requested conditions.

Z&L Properties’ attorney declined to comment on the owners association’s allegations.

In July 2022, the owners association at 555 Fulton in San Francisco sued Z&L Properties, claiming that the building contained construction defects, including leaking windows, water ponding in stairwells, inadequate hot water delivery and overheating units, among other issues.

The Trader Joe’s that was promised at that location has been stalled for years. But reports by the San Francisco Business Times that Z&L Properties sold the commercial space to a new developer in September indicate efforts to bring a grocery store may finally be underway.

Meanwhile, at least 1,000 homes that Z&L Properties announced it would build in the Bay Area remain far from a reality.

The post Billionaire’s Agency Fined $1M for Bribes appeared first on DAILY SAN FRANCISCO BAY NEWS.

SAUSALITO (CBS SF/BCN) – Sausalito police cited the owner of a small sailboat that was illegally beached in Dunphy Park Saturday, which later sank and possibly created an environmental hazard.

Police said they issued 72-hour warnings to move the sailboats to the owners, who initially refused to move their boats Saturday afternoon after beaching them illegally in Dunphy Park to have their hulls scraped.

READ MORE: UPDATE: Hazmat Situation Cleared At Fremont Industrial Gas Supplier

Police said they informed the boaters that beaching the boats was against the law in that area, because it is considered environmentally sensitive and that scraping the boats could also pollute the area.

Police said one of the boats sailed away but the other stayed, eventually filling with water and then sinking. A sheen formed around the boat, something police suspect is the result of fuel leaking from the boat.

READ MORE: Police: San Francisco Safeway Shooting Followed Parking Lot Altercation

Police have not released the name of the sunken boat’s owner, who was cited for the environmental violation related to the diesel spill.

Police also arranged for Parker Diving Service to place a protective boom around the sunken boat to prevent further damage to the environment.

MORE NEWS: VTA Shutting Down Portion Of Light-Rail Tracks For Replacement

© Copyright 2022 CBS Broadcasting Inc. and Bay City News Service. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

The post Sausalito Sailboat Proprietor Fined For Not Shifting Boat From Seashore, Letting It Sink – CBS San Francisco appeared first on DAILY SAN FRANCISCO BAY NEWS.

State water pollution officials fined Sunnyvale $ 187,000 after the city’s sewage treatment plant spilled more than a quarter of a million gallons of partially treated wastewater into San Francisco Bay last summer.

The spill occurred on July 29 when 36-inch welded steel pipeline broke, releasing 292,600 gallons – the equivalent of about 12 backyard swimming pools – of partially treated sewage that did not drain into canals into the bay near Moffett Field.

“These types of discharges pose a threat to the environment and human health,” said Thomas Mumley, vice chairman of the San Francisco Bay Regional Water Quality Control Board. “This enforcement measure is recognized by the wastewater treatment industry and will hopefully be a deterrent.”

The spill was one of the two largest illegal discharges from a Bay Area sewage treatment plant to San Francisco Bay in the past six years, Mumley said. It was dwarfed only by a 2.2 million gallon leak from the Sonoma Valley County Sanitation Agency facility on Jan. 11-12, 2019. This discharge of partially purified sewage, which resulted in a fine of $ 427,000, flowed into Sonoma Creek, which flows to San Pablo Bay.

The Sunnyvale case was settled on Monday.

Sunnyvale officials said the pipe that failed is 3 meters underground and was built in 1975. They said it had never failed before and should be replaced over the next few years as part of a massive $ 1 billion wastewater treatment modernization project, which was built in 1956 over a 20-year period. The plant supplies around 160,000 residents in Sunnyvale.

“That was something unexpected,” said Ramana Chinnakotla, Sunnyvale’s environmental manager. “But we know that our system ages. For this reason, the city council has committed to modernizing the facility. This pipe should be replaced. It’s unfortunate that it failed before we had a chance to replace it. “

Chinnakotla said no dead fish or other wildlife were seen in the water. The Bay Trail is nearby, but he said the area where the spill occurred – in a canal next to former Cargill Salt ponds now owned by the U.S. Fish and Wildlife Service – is not open to the public.

“This is a fish and wildlife channel,” he said. “It’s not really used for recreation. The probability that people would have come into contact with it is very low. “

Water tests conducted in the area after the spill found enterococcal bacteria 22 times higher than the state standard, along with elevated ammonia and pH levels, which can be harmful to fish and wildlife.

State regulations require that water pollution incidents be reported to the California Emergency Services Bureau and local health department within two hours. Workers at the Sunnyvale plant discovered the leak at 6:15 p.m. on July 29, but didn’t report it until 11 a.m. the next morning, state inspectors concluded. They also failed to properly put up signs warning of public health hazards, inspectors reported.

“Improperly treated wastewater does not belong in the bay,” said Sejal Choksi-Chugh, executive director of San Francisco Baykeeper, an environmental group. “And any amount is too much. But it is especially egregious if the spillage could have been prevented through routine surveillance and maintenance and neither the public nor the regulators were informed in a timely manner. Even partially purified wastewater contains bacteria, viruses and other harmful pathogens that can make people sick. “

The failed pipe connects the Sunnyvale wastewater treatment plant, located on the edge of the bay on Borregas Avenue between Moffett Field and Yahoo’s headquarters, to two oxidation basins that naturally treat wastewater before returning it to the for final disinfection Plant is pumping and filtering before clean water is piped into the bay. The next day, the pipe was taken out of service and two temporary above-ground pipes were installed in its place.

The city will be able to cover half the fine by completing a natural rainwater treatment project on Wolfe Road and Stewart Drive in Sunnyvale.

“The city doesn’t want such discharges to happen,” said Chinnakotla. “In this case, the wastewater was partially cleaned. There was no public health hazard. And we were able to correct it very quickly. “

The Sunnyvale Sewage Treatment Plant on Borregas Avenue spilled 292,600 gallons of partially purified wastewater into San Francisco Bay on July 29, 2020 when a pipe, shown with the red dot at the bottom of the image, broke, resulting in a penalty of 187,000 US dollars led state water regulators. (Photo: Google Maps)

The post Sunnyvale fined $187,000 for San Francisco Bay sewage spill appeared first on DAILY SAN FRANCISCO BAY NEWS.

Giants welcome fans back to Oracle Park for the home openerThe San Francisco Giants will play in front of their home fans for the first time since the end of the 2019 season. Devin Fehely reports. (04/09/21)

2 hours ago

Britain mourns Prince Phillip at the age of 99Ian Lee reports on Prince Phillip’s death at Windsor Castle (4-9-2021)

2 hours ago

Liam’s list: Friday April 9th ​​- food, lovely food; Music by Prince & a Royal FarewellKCBS reporter Liam Mayclem will provide KPIX 5 users with a weekly tip list on how best to survive the current coronavirus outbreak.

5 hours earlier

Weather forecast for Friday morning with Mary Lee(04/09/21)

7 hours ago

Oracle Park open to fans for Giants Home OpenerThe San Francisco Giants’ home opening game on Friday marks the first time fans have attended a game at Oracle Park since the pandemic began.

8 hours ago

Giant fans need vaccination documents or a negative COVID test to get into the ballparkThe Giants’ home opener is Friday afternoon and this season: no cardboard clippings, but real live fans in the stands. Andria Borba reports. (4-8-21)

15 hours ago

Psychiatrists recommend a hybrid approach when returning to work after a pandemicIt’s been over a year of masking, protection, and home work. We were naturally far away and now millions of workers are being recalled. Susie Steimle reports. (4-8-21)

15 hours ago

Attack on elderly Asian woman in San Francisco not racially motivated, attorney saysThe newly released surveillance video shows that a beating suspect was personally assaulted before allegedly assaulting an elderly Asian woman in San Francisco. Maria Medina reports. (4-8-21)

16 hours ago

PIX nowHere’s the latest from the KPIX newsroom. (4-8-21)

19 hours ago

Cops fined for baiting and poaching trophy deer in the Sierra foothillsTwo Amador County officials have posted numerous rare trophy kills online and called on the California Department of Fish and Wildlife to investigate. Marissa Perlman reports. (4-8-21)

20 hours ago

Youth and COVID: Experts and educators assess virus risk for athletics studentsWith more and more young people playing sports and being in schools, KPIX asked some experts: How high is the risk of spreading COVID-19? Elizabeth Cook reports. (4-8-21)

20 hours ago

California’s recovering economy threatened by labor shortagesThe California economy is picking up speed, but a new employment report shows that much of the state’s economy is still stuttering. Len Ramirez reports. (4-8-21)

20 hours ago

The long-lost GoPro camera returned to San FranciscoA Bay Area couple has made some precious memories back years after losing their GoPro camera. (4-8-21)

20 hours ago

Soaring lumber prices are hitting new home buyers in California hardLumber prices have reached historic levels, making homes in California even more expensive. Builders say it is creating a ripple effect that is driving more people out of the market. Susie Steimle reports. (4-8-21)

21 hours ago

Former 49er and raider identified as South Carolina GunmanPolice are trying to find out what prompted a former 49ers and Raiders player to allegedly kill five people, including a prominent doctor, before taking his own life. (4-8-21)

21 hours ago

Precise forecast for Thursday eveningChief meteorologist Paul Heggen has the (disappointing) dry forecast. (4-8-21)

21 hours ago

Marin County is considering imposing irrigation restrictionsNearly 200,000 Marin County residents can be under mandatory water conservation restrictions in a few weeks. Kenny Choi reports. (4-8-21)

21 hours ago

Reduced supply of Johnson & Johnson doses is unlikely to affect vaccination efforts in the Bay AreaAs more and more people become eligible, there remains a problem with vaccine supply, and California has just announced that it expects Johnson and Johnson doses to drop nearly 90 percent next week. Wilson Walker reports. (4-8-21)

22 hours ago

CA Congressman Mike Thompson on Biden’s gun control instructionsPresident Biden on Thursday unveiled his first attempts to curb gun violence and announced a series of humble measures to overhaul federal guns policy by changing the government’s definition of a firearm and responding more aggressively to urban gun violence. Anne Makovec of KPIX 5 spoke to California Congressman Mike Thompson about the new measures and the next steps in responding to gun violence.

1 day ago

Santa Clara County allows residents over the age of 16 to sign up for vaccination appointmentsDevin Fehley reports that Santa Clara County has opened the process of appointing COVID vaccines to all residents aged 16 and older (4-8-2021)

1 day ago

Thursday afternoon forecast with Mary Lee(04/08/21)

1 day ago

Biden announces executive measures to curb gun violenceDebra Alfarone reports that President Biden has taken executive action to combat the recent surge in deadly gun violence (4-8-2021).

1 day ago

Former Raider, 49er Phillip Adams kills 5 in South Carolina mass shooting before killing himselfAnne Makovec reports on ex-49er and raider player Phillip Adams, who fatally shot and killed five in South Carolina before committing suicide (4-8-2021).

1 day ago

The post Cops Fined for Baiting, Poaching Trophy Deer in Sierra Foothills – CBS San Francisco appeared first on DAILY SAN FRANCISCO BAY NEWS.