SAN FRANCISCO – Alan Varela and William Gilmartin III appeared in federal court today and each pleaded guilty to the charge of conspiracy to commit honest services wire fraud, announced Acting United States Attorney Stephanie M. Hinds and Federal Bureau of Investigation Special Agent in Charge Craig D. Fair.  Gilmartin further agreed in his plea agreement to cooperate with federal investigators in the San Francisco City Hall corruption investigation. 

“Contractors with San Francisco like Alan Varela, William Gilmartin, and their ilk are not off the radar of our San Francisco City Hall corruption investigation just because they are not public officials,” said Acting United States Attorney Stephanie M. Hinds.  “If you bribe a public official and our investigation uncovers it, you will face justice.  Involved individuals who come to the FBI with what they know about bribes and kickbacks will be treated differently than those who don’t and get caught.”

“The investigation into San Francisco city government continues and we believe there are even more city employees and contractors who may have pertinent first-hand knowledge of the insidious corruption plaguing San Francisco,” said FBI Special Agent in Charge Craig D. Fair. “Instead of waiting for the FBI to knock on your door, we encourage others who have knowledge of this corruption to reach out to us and cooperate with our investigation.”

Today’s developments follow the September 17, 2020, federal complaint charging Varela, 59, of Orinda, and Gilmartin, 60, of San Mateo, with bribery of a public official.  According to that complaint affidavit, Varela and Gilmartin, the president and vice-president of a Bay Area civil engineering and construction firm, respectively, provided gifts and benefits to Mohammed Nuru, then Director of San Francisco’s Department of Public Works (DPW), in exchange for inside information about an upcoming lucrative San Francisco public contract.  Varela and Gilmartin were the seventh and eighth defendants charged in the federal San Francisco City Hall graft probe that has to this date charged a dozen defendants.

Varela’s plea agreement expounds on those complaint allegations.  Varela admitted in his plea agreement that from 2013 until January 28, 2020 (the day of Nuru’s arrest), he conspired with his co-defendant Gilmartin, Balmore Hernandez – a construction company CEO who earlier pled guilty and is cooperating with the FBI – and others to pay bribes and kickbacks to Nuru.  Nuru’s position as DPW Director provided him great influence over San Francisco public contracts, permits, and construction projects as well as other City departments and private companies requiring contracts from DPW.  The bribes and kickbacks to Nuru were intended to influence his conduct in official actions.  The items of value Varela and his co-conspirators provided to Nuru included cash, equipment for Nuru’s ranch, free meals and entertainment, and the prospect of portions of the proceeds from the expected awards of City contracts.

Varela further admitted that he and his co-conspirators focused on winning a DPW contract and a related Port of San Francisco lease to operate an asphalt recycling plant and a concrete plant on the Port of San Francisco’s land.  According to Varela’s plea agreement, Nuru agreed in exchange for cash and other valuables to use his official position to get Varela and his co-conspirators’ bid selected.  Nuru began sending early drafts of San Francisco’s Request for Proposals for the asphalt recycling plant project as well as other inside information to Varela and his co-conspirators to better position them to have their bid selected.  Nuru also regularly met with Gilmartin and Hernandez to discuss the plans over expensive restaurant dinners, always paid for by Gilmartin. 

According to Varela’s plea agreement, Gilmartin arranged to compensate Nuru by asking an unnamed company to award a $100,000 contract to Balmore Hernandez.  The proceeds of that contract were intended to pay Nuru, and Hernandez used the proceeds to benefit Nuru.  Once the co-conspirators’ bid was selected in September 2015, Nuru continued to meet with Varela and the co-conspirators and supply additional inside information, all over meals paid for by Gilmartin that ultimately totaled approximately $20,000.  At one point during discussions, Nuru requested a tractor for his ranch.  Varela admitted that in February 2019 he coordinated with Gilmartin and Hernandez to deliver the tractor to Nuru. 

In January 2020, while the asphalt recycling plant agreements with DPW and the Port of San Francisco were still being finalized, Nuru was arrested.

Gilmartin also pleaded guilty today to the charge of conspiracy to commit honest services wire fraud.  The terms of his plea agreement require Gilmartin to cooperate with the ongoing investigation and surrender assets acquired as a result of his illegal conduct.  The criminal conduct Gilmartin admits was submitted to the Court in a separate “Exhibit A” that is filed under seal and thus unavailable to the public at this time.  

Varela and Gilmartin both entered their guilty pleas before United States District Judge William H. Orrick. Judge Orrick set Varela’s sentencing hearing for September 16, 2021, at 1:30 p.m.  Gilmartin’s next hearing date is a status conference set for December 2, 2021, at 1:30 p.m.

Varela and Gilmartin each pleaded guilty to one count of conspiracy to commit honest services wire fraud, in violation of 18 U.S.C. §§ 1343, 1346 and 1349.  The charge carries a maximum statutory penalty of 20 years in prison and a fine of $250,000 or not more than the greater of twice the gross gain or twice the gross loss.  However, any sentence following conviction would be imposed by the Court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553. 

The prosecution is being handled by the Corporate Fraud Strike Force in the Office of the U.S. Attorney for the Northern District of California and is the result of an investigation by the FBI. 

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SAN FRANCISCO – Bernard Curran, a former San Francisco Senior Building Inspector, pleaded guilty today to two counts of accepting gratuity payments as rewards for approving building permits, announced United States Attorney Stephanie M. Hinds and Federal Bureau of Investigation Special Agent in Charge Robert K. Tripp. 

Curran, 62, of San Francisco, was employed at the San Francisco Department of Building Inspection (DBI) from 2005 until he resigned from his supervisory position as Senior Building Inspector while on administrative leave in May 2021. Curran’s official duties included conducting physical inspections of buildings and construction sites in San Francisco. For a San Francisco property owner intending to shepherd a construction or remodeling project from inception to completion, the first hurdle is to obtain a permit from DBI. Once the permit is obtained and the work is underway, the next hurdle is to pass on-site physical inspections by DBI inspectors who determine whether the work completed complies with the work authorized by the permit. If a project passes all inspections and is deemed completed successfully, DBI inspectors “final” the permits and issue a certificate of final completion and occupancy (CFC), allowing the property to be used. 

In his plea agreement today, Curran admitted that he accepted illegal payments from two people in connection with his official duties. The first was a long time San Francisco real estate developer who Curran developed a friendship with in the 1990s. Over time, Curran inspected dozens of properties and projects connected to the developer. Curran admitted that during his DBI career, he received numerous financial benefits from the developer that he knew were improper. Upon Curran being promoted to Senior Building Inspector in 2009, he accepted cash payments as “rewards” from the developer in connection with final inspections and/or CFC issuances that Curran conducted at the developer’s properties. In one instance in March 2017, Curran accepted $260,000 from the developer to assist Curran in paying down his existing residential mortgage so he could obtain favorable refinancing rates. Though Curran intended to repay the money, he knew that accepting it was improper and created a forbidden conflict of interest. Moreover, though Curran paid most of the $260,000 back, he admitted the developer never required him to repay $30,000 of the outstanding balance. Curran understood that the $30,000 debt forgiveness was an improper reward for conducting past and future inspections at the developer’s building projects. 

The second person Curran admitted receiving illegal gratuities from was an engineer who worked with project owners and contractors seeking building permits in San Francisco. The engineer worked frequently with Curran and knew he was a volunteer coach and supporter of a San Francisco non-profit adult and youth athletic organization. Curran admitted in his plea agreement that the engineer arranged for the engineer’s clients to make charitable donations to the athletic organization as rewards for and in connection with inspections by Curran of the clients’ properties. The donations were typically made by check and several times were delivered directly to Curran, who in turn delivered the checks to the athletic organization. According to the plea agreement, in several instances the engineer advised Curran of a client’s donation while asking for a final permit or inspection on the client’s property. From May 2017 through April 2019 the athletic organization received 13 such checks from the engineer’s clients, totaling $9,600. Curran admitted that he took official action for each of the clients who wrote the 13 checks, knowing this conduct was not permitted.

Curran entered his guilty pleas before United States District Judge Susan Illston, who scheduled a sentencing hearing for Curran on March 31, 2023. Curran remains out of custody pending his sentencing hearing.

Curran pleaded guilty to two counts of accepting illegal gratuities in violation of 18 U.S.C. § 666(a)(1)(B). Each count carries a maximum statutory term of imprisonment of 10 years. However, any sentence following conviction imposed by the court will occur only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553. 

The Special Prosecutions Section of the U.S. Attorney’s Office for the Northern District of California is prosecuting the case. The prosecution is the result of an investigation by the Federal Bureau of Investigation. 

This case is part of a larger federal investigation targeting public corruption in the City and County of San Francisco. To date, twelve individuals have been charged, including high-ranking San Francisco public officials Harlan Kelly and Mohammed Nuru. Nuru was sentenced to seven years in federal prison in August 2022. Multiple city contractors and facilitators have also been charged and several have been sentenced to prison. 
 

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SAN FRANCISCO – Three former executives of a San Francisco based construction planning and design firm were charged today paying bribes to employees of the San Francisco Department of Building Inspection (”DBI”), announced the Chief of the Criminal Division of the Office for the U.S. Attorney Thomas A. Colthurst and Federal Bureau of Investigation Special Agent in Charge Robert Tripp.

Siavash “Sia” Tahbazof, 72, was charged in an Information filed today with one count of conspiracy to commit honest services wire fraud for paying bribes to DBI employees in return for their agreement to expedite and issue building plan permits and approve building inspections, beginning in 2003. According to the Information, Tahbazof conspired to bribe city employees including former DBI plan checkers Cyril Yu and Rodolfo “Rudy” Pada, and DBI building inspector Bernard Curran.

In a separate information also filed today, Reza Khoshnevisan, 54, was charged with one count of conspiracy to commit honest services wire fraud for paying bribes to Pada and Yu in return for their agreement to expedite and issue building plan permits. The conspiracy allegedly began in 2012.

In addition, Bahman Ghassemzadeh, 38, was charged in a third Information filed today. Ghassemzadeh is charged with one count of conspiracy to commit honest services wire fraud for paying bribes to Pada, Yu, and Curran, beginning in 2014, in return for their agreement to expedite and issue building plan permits and approve building inspections.

DBI is a regulatory city agency in San Francisco responsible for overseeing enforcement of building, electrical, plumbing, and housing codes for the City of San Francisco’s more than 200,000 commercial and residential buildings. Contractors and builders submit construction plans to DBI for approval and permitting; the plans are required to be reviewed and approved by DBI to insure that the proposed construction and building meets city codes and regulations.

An Information merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. The defendants were each charged with one count of conspiracy to commit honest services wire fraud in violation of 18 U.S.C. § 1349. If convicted, each defendant faces a maximum sentence of twenty years imprisonment, and a fine of up to $250,000. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.

Pada, 68, and Yu, 41, have both already been charged in separate Informations with conspiracy to commit honest services wire fraud. The Informations, filed on November 3, 2023, allege Pada accepted bribes in return for expediting and approving permits for building and construction plans and allege that Yu accepted bribes in return for approving permits for construction and building plans.

Assistant U.S. Attorneys David Ward and Casey Boome are prosecuting the case. The prosecution is the result of an investigation by the Federal Bureau of Investigation.

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SAN FRANCISCO – Two former San Francisco Department of Building Inspection (DBI) construction plan engineers have been charged in federal court with participating in an honest services wire fraud conspiracy for accepting bribes in return for expediting and approving building and construction plan permits, announced Attorney for the United States Thomas A. Colthurst and Federal Bureau of Investigation (FBI) Special Agent in Charge Robert K. Tripp.

According to a criminal Information filed on November 2, 2023, Rodolfo “Rudy” Pada, 68, of Millbrae, California, began accepting bribes in 2003 and continued to do so until he retired in September 2017. The Information alleges the bribes consisted of cash, free meals, drinks, and other benefits bestowed upon Pada by executives at a construction planning and design firm in return for Pada expediting and approving permits for building and construction plans. In addition, Pada is alleged to have solicited, accepted, and concealed an interest-free $85,000 loan facilitated by a construction planning and design firm executive.

According to a separate Information filed on November 2, 2023, Cyril Yu, 41, of San Francisco, began accepting bribes in January 2018 and continued to do so until February 2021. The Information alleges the bribes consisted of cash, free meals, drinks, and other benefits bestowed upon Yu by executives at a construction planning and design firm in return for Yu expediting and approving permits for building and construction plans.

The Informations allege that DBI is a regulatory agency in the City and County of San Francisco responsible for overseeing enforcement of building, electrical, plumbing, and housing codes for San Francisco’s more than 200,000 commercial and residential buildings. According to the Informations, contractors and builders submit construction plans to DBI for approval and permitting; the plans must be reviewed and approved by DBI to ensure that proposed construction plans meet City codes and regulations.

An information merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. Pada and Yu were each charged with one count of conspiracy to commit honest services wire fraud in violation of 18 U.S.C. § 1349. If convicted, each defendant faces a maximum sentence of 20 years imprisonment, and a fine of up to $250,000. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.

The case is being prosecuted by the Corporate and Securities Fraud Section of the United States Attorney’s Office. Assistant U.S. Attorneys David Ward and Ilham Hosseini are prosecuting the case, which is the result of an investigation by the FBI

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SAN FRANCISCO – Bernard Curran, a former San Francisco Senior Building Inspector, was sentenced today to serve a year and a day in prison in connection with charges that he accepted cash payments and charitable donations from developers and property owners whose projects Curran had responsibility for approving, announced United States Attorney Ismail J. Ramsey and Federal Bureau of Investigation Special Agent in Charge Robert K. Tripp. The sentence was handed down by United States Senior District Judge Susan Illston.

Curran, 62, of San Francisco, pleaded guilty to the charges on December 9, 2022. According to his plea agreement, Curran acknowledged that he was a Building Inspector for the San Francisco Department of Building Inspection (“DBI”) in 2005, and in approximately 2009, was promoted to Senior Building Inspector. As a Senior Building Inspector, Curran was responsible for conducting physical inspections of buildings and construction sites in San Francisco to verify that construction or renovation work had been completed according to approved permits and plans. Curran admitted that after he became a Senior Building Inspector, he received improper financial benefits in connection with his employment.

“San Francisco government officials must always work with the public’s best interest in mind and rebuff invitations for corrupt personal gain,” said U.S. Attorney Ramsey. “Curran is not the first, and he will not be the last, defendant sentenced in rooting out corruption in San Francisco. Today’s sentence makes clear that officials who abuse the public trust will serve time in federal custody.”

“Bernard Curran chose to line his own pockets instead of performing his duties with integrity,” said Special Agent In Charge Robert K. Tripp. “That’s not a small lapse: building inspectors ensure our new construction is safe, and play a key role in creating new housing and businesses that make San Francisco a vibrant place to live and work. Curran’s time in prison should be a stark warning to all that if you’re a public servant who takes a bribe, you will be held to account.”

According to his plea agreement, Curran admitted that he received cash payments from a San Francisco developer “in connection with and as rewards for” the inspections that he conducted or for the approvals that Curran granted as an inspector. In addition, Curran admitted that he accepted what amounted to a $260,000 interest-free loan from the same developer, $30,000 of which was never paid back. Curran admitted that he understood the developer never required the outstanding $30,000 balance to be repaid, “in part due to our friendship, but also in connection with and as a reward for conducting past and future inspections,” on the developer’s projects. Further, Curran admitted that in 2021, the San Francisco City Attorney’s Office investigated potential conflicts of interest related to his employment and, in response, Curran falsely certified that the loan he received was not from the developer, but rather was from a relative and had been issued at a 6% interest rate. Curran admitted that he submitted this false statement in an effort to deceive the City officials.

In addition to the improper gifts from the developer, Curran also admitted in his plea agreement that he accepted illegal gifts from co-defendant Rodrigo Santos. Santos, a licensed civil engineer, worked with project owners and contractors seeking building permits in San Francisco. Curran admitted that between May of 2017 and April of 2020, Santos asked some of his San Francisco clients to make “charitable” donations in connection with inspections that Curran conducted. Specifically, Curran was a volunteer for, and supporter of, a non-profit organization and Santos instructed his clients to write checks for the organization. Curran admitted that on several occasions Santos discussed with Curran the checks that his clients donated while also asking for official action to be taken on specific projects. Curran admitted that the government could prove that between May of 2017 and April of 2019, Santos’s clients wrote $9,600 in donations from 13 clients and that Curran took at least one official action for all 13 of the donors.

On November 28, 2022, Curran was charged by superseding information with two counts of accepting illegal gratuities, in violation of 18 U.S.C. § 666(a)(1)(B). Curran pleaded guilty to both counts.

In addition to the prison term, Judge Illston sentenced Curran to two years of supervised release following his prison term. The court set a further hearing on September 8, 2023, to determine the amount of restitution that Curran must pay to DBI to compensate the agency for the costs of an internal audit of projects that Curran inspected. DBI initiated the audit after the charges in this case

The case is being prosecuted by the Special Prosecutions Section of the U.S. Attorney’s Office. The case is being investigated by the FBI and the IRS-CI.

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SAN FRANCISCO – A federal jury today convicted Harlan Kelly, the former General Manager of the San Francisco Public Utilities Commission (PUC) of charges that he accepted bribes and gifts from a local businessman in a scheme to provide confidential information about the city public bidding process and steer city contracts to that person’s businesses, announced First Assistant United States Attorney Patrick Robbins, Federal Bureau of Investigation Special Agent in Charge Robert K. Tripp, and Internal Revenue Service-Criminal Investigation (IRS-CI) Special Agent in Charge Darren Lian. The verdict follows a two-week trial before United States Chief District Judge Richard Seeborg.

Kelly, 61, of San Francisco, was arrested on a criminal complaint in November 2020, and he was tried on charges contained in a May 31, 2022, superseding indictment that included charges of conspiracy to commit honest services wire fraud and honest services wire fraud. The superseding indictment also included charges of false statements to a bank, conspiracy to make false statements to a bank, bank fraud, and bank fraud conspiracy, related to a scheme to defraud Quicken Loans in connection with a $1.3 million mortgage refinance loan obtained by Kelly.

Kelly was convicted of one count of conspiracy to commit honest services wire fraud, one count of honest services wire fraud, and all four counts related to the bank fraud scheme. The jury found Kelly not guilty of two honest services wire fraud counts.

The charges against, and prosecution of, Kelly grew out of a years-long investigation into bribery and public corruption in San Francisco city government, led by the U.S. Attorney’s Office, the FBI, and IRS-CI. To date, 13 individuals have been charged in connection that larger set of investigations, including Mohammed Nuru, former director of the San Francisco Public Works department, and multiple city contractors and other facilitators of bribes and corruption.

The evidence at trial showed that Kelly, appointed in 2012 as General Manager of the San Francisco PUC, had access to confidential information about city contract bidding processes, and the ability to influence the awarding of some city contracts. Documents and testimony showed that Kelly had a close personal and professional relationship with San Francisco business owner and contractor Walter Wong, and that during the time Wong both conducted business with the city and sought additional lucrative contracts to supply the PUC with LED streetlights. While he was doing business with the city and seeking contracts, Wong provided numerous gifts, benefits, and bribes to Kelly. These bribes including discounted construction work on Kelly’s personal residence and a lavish international trip hosted by and in part paid for by Wong. Evidence showed that Wong paid travel and personal expenses for Kelly and his family during a March 2016 Kelly family vacation to Hong Kong, Macau, and China, and that Wong paid for hotel expenses and incidentals such as meals and luxury excursions. Wong has previously pleaded guilty to charges that he engaged in an honest services fraud conspiracy in connection with his interactions with Kelly and others.

The evidence at trial showed that as part of the bribery conspiracy, Kelly provided confidential information and documents about the details of bids submitted by other contractors, including proprietary pricing and cost information, and information and documents with internal notes about how city employees in the PUC were evaluating and rating the bidders. The evidence showed that Kelly delivered these documents to Wong and his associates in violation of Kelly’s fiduciary obligations to the city and its residents, and that the confidential information assisted Wong and his company in improving Wong’s chances to obtain the contract award.

Trial evidence also showed that Kelly defrauded Quicken Loans, a financial institution, in a $1.3 million dollar real estate mortgage loan provided to Kelly. The evidence at trial showed that Kelly worked with an associate, prominent city businessman and property manager Victor Makras, to mislead the bank. According to the evidence, in the application for the loan Kelly falsely represented that he had a $915,000 mortgage and concealed the true nature of his debts from Quicken. According to the trial evidence, these misrepresentations were material to the bank’s evaluation of the borrower and the loan. The outstanding debts that Kelly concealed from Quicken included a construction debt owed to the contractor, Walter Wong that amounted to about $89,000. Another debt concealed from the company was a $70,000 unsecured personal loan made by Makras to Kelly, a result of Makras directly paying Kelly’s credit card debt in order to conceal the fact that Kelly received this loan from Makras.

Co-defendant Makras, 64 of San Francisco, was also charged in the May 31, 2022 superseding indictment, and was convicted of making false statements to a bank and bank fraud at a separate trial in August 2022.

The federal jury today convicted Kelly of the following:

•    One count of conspiracy to commit honest services wire fraud, in violation of 18 U.S.C. §§ 1343, 1346, and 1349, which carries a maximum possible penalty of 20 years in prison and a fine of $250,000, or the greater of twice the gross gain or gross loss
•    One count of honest services wire fraud, in violation of 18 U.S.C. §§ 1343 and 1346, which carries a maximum possible penalty of 20 years in prison and a fine of $250,000, or the greater of twice the gross gain or gross loss
•    One count of making false statements to a bank in violation of 18 U.S.C. § 1014, which carries a maximum possible penalty of 30 years in prison and a $1,000,000 fine
•    One count of conspiracy to make false statements to a bank in violation of 18 U.S.C. § 371, which carries a maximum possible penalty of 5 years in prison and a fine of $250,000
•    One count of bank fraud, in violation of 18 U.S.C. §§ 1344(1),(2), which carries a maximum possible penalty of 30 years in prison and a fine of $1,000,000, or not more than the greater of twice the gross gain or gross loss
•    One count of conspiracy to commit bank fraud, in violation of 18 U.S.C. §§ 1344(1),(2) and 1349, which carries a maximum possible penalty of 30 years in prison and a fine of $1,000,000, or not more than the greater of twice the gross gain or gross loss

As part of any sentence, the court also may order the defendant to serve an additional period of supervised release to begin after any prison term, to pay additional penalties, and to pay restitution, if appropriate. However, any sentence will be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing imposition of a sentence, 18 U.S.C. § 3553. Defendant Kelly remains out of custody pending sentencing. No future date has yet been set.

The case is being prosecuted by the Corporate and Securities Fraud Section of the U.S. Attorney’s Office. Assistant U.S. Attorneys David Ward and Kristina Green prosecuted the case at trial with the assistance of Tina Rosenbaum. The case is being investigated by the FBI and the IRS-CI.

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SAN FRANCISCO – Zhang Li, founder and chief executive officer of a Chinese real estate development company appeared last night in U.S. District Court on charges that he bribed former head of the San Francisco Department of Public Works Mohammed Nuru, announced First Assistant United States Attorney Patrick Robbins, Federal Bureau of Investigation Special Agent in Charge Robert K. Tripp, and Internal Revenue Service-Criminal Investigation Special Agent in Charge Darren Lian. A U.S. company that Zhang controls, Z&L Properties, Inc., was also charged with honest services wire fraud for providing bribes and gifts to Nuru in exchange for favorable city treatment of Z&L Properties’ mixed-use project at 555 Fulton Street in San Francisco, Calif. As part of a negotiated disposition both Zhang and Z&L Properties will waive the right to indictment and admit that they engaged in certain conduct.

Zhang, 70, of Guangzhou, China, has been charged by Information with one count of conspiracy to commit honest services fraud. According to the Information, Zhang bribed Nuru by providing him with food, drinks, luxury lodging, and transportation during a trip Nuru took to China in 2018. The Information alleges the purpose of the bribe was to influence Nuru so that he would provide favorable treatment on decisions and city approvals needed during the construction and development of a mixed-use property at 555 Fulton Street in San Francisco being developed by Zhang and a company Zhang controlled.

Z&L Properties Inc., a U.S. company formerly based in Fremont, Calif., and controlled by Zhang, was also charged in a separate Information with conspiracy to commit honest services fraud and honest services wire fraud for its participation in the bribery scheme. Z&L Properties managed the development of the 555 Fulton Street project and the company facilitated the payment of bribes to Nuru in exchange for favorable treatment regarding the 555 Fulton project, according to the allegations in the criminal Information.

“Zhang Li and Z&L Properties have admitted that they bribed a top San Francisco public official. The criminal charges and resolutions announced today send a clear message that this office will not tolerate the corruption of public officials in the District by anyone, including individuals acting from outside of the United States,” said First Assistant U.S. Attorney Patrick Robbins. “To those who seek to corrupt public officials in the United States, wherever they are, we will use the powers at our disposal to bring them to justice and hold them accountable to the rule of law.”

“Zhang Li, who earned his profits through bribery of a San Francisco public official, is yet another individual charged in connection to our ongoing public corruption case,” said FBI Special Agent in Charge Robert Tripp. “Public corruption erodes public confidence and strikes at the very foundation of our government. The citizens of San Francisco deserve better, and we stand firmly committed to investigating both corrupt officials and private citizens who attempt to bribe them, no matter where they reside.”

“IRS-Criminal Investigation’s priority is to ensure a fair and level playing field for all taxpayers,” said Special Agent in Charge Darren Lian of the Oakland Field Office. “Mr. Li’s conduct shows that greed and financial crimes have no borders, and we will continue to pursue those who take advantage of our system and taxpayers by following the money worldwide. We are proud to have worked alongside our federal law enforcement partners and the U.S. Attorney’s Office in bringing this case a step closer to closure.”

Zhang originally was charged by criminal complaint in May of 2021. At the request of the United States, Zhang was arrested when he arrived in the United Kingdom in December 2022 and the United States pursued extradition. After approximately six months, Zhang consented to extradition and was subsequently surrendered to U.S. authorities. The charges against Zhang now are set forth in an Information filed by the government.

Zhang appeared yesterday before U.S. Magistrate Judge Alex Tse in the Northern District of California. Magistrate Judge Tse released Zhang on a bond pending further proceedings.

According to the documents filed in Zhang’s case, the defendant and the U.S. Attorney’s Office have entered a deferred prosecution agreement. Under that agreement filed today, Zhang admitted to the conduct that forms the basis of the charge in the Information, and, if Zhang abides by the terms of the deferred prosecution agreement, the charge will be dismissed in three years.

According to filed documents, Z&L Properties also will plead guilty to charges set out in the Information filed against it; Z&L also will agree to a comprehensive compliance and remediation program designed to prevent bribery and corruption in connection with Z&L Properties’ real estate development work. Z&L Properties has agreed to plead guilty to one count of conspiracy to commit honest services wire fraud and one count of honest services wire fraud, will pay a fine of $1,000,000, and will enter into a corporate compliance program acceptable to the Office of the U.S. Attorney. Z&L Properties appeared before U.S. Magistrate Judge Alex Tse today, and the court set a further hearing before U.S. District Judge William H. Orrick, on August 10, 2023, at 1:30 p.m.

The charges against Zhang and Z&L Properties arose from an investigation into bribery and public corruption in San Francisco city government led by the U.S. Attorney’s Office, the FBI, and IRS-CI. To date, more than 14 individuals and entities have been charged in connection that larger set of investigations, including Mohammed Nuru, former director of the San Francisco Public Works department; Harlan Kelly, the former general manager of the San Francisco Public Utilities Commission; and multiple city contractors and other facilitators of bribes and corruption.

Nuru was charged in January 2020, pleaded guilty in January 2022, and on August 25, 2022, Nuru was sentenced to 84 months in federal prison. A separate defendant charged in the investigation, Walter Wong, was charged in June 2020 with conspiracy to defraud the public of its right to honest services and with conspiracy to engage in money laundering, both involving Nuru. Wong entered a guilty plea and agreed to cooperate with the government’s San Francisco City Hall corruption investigation.

An Information merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, the defendant Zhang faces a maximum sentence of 20 years imprisonment, a maximum fine of $250,000, plus restitution if appropriate. Z&L Properties faces a maximum fine of $500,000 per count, plus restitution if appropriate. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.

The case is being prosecuted by the Corporate and Securities Fraud Section of the U.S. Attorney’s Office for the Northern District of California. Assistant U.S. Attorneys David Ward and Robert Leach are prosecuting the case. The prosecution is the result of an investigation by the FBI and the Internal Revenue Service-Criminal Investigations (IRS-CI). First Assistant U.S. Attorney Patrick Robbins thanked the Department of Justice’s Office of International Affairs and United Kingdom authorities for their assistance in the extradition.

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CHRISTINE MAXA
Special to the Daily Sun

In Arizona, wildlife flourishes, and around the beginning of September, everything is elk. They announce their season with a blast of their bugle — an edgy, high-pitched scream that sounds downright eerie in a hollow.

That trademark bugle is not the only distinctive feature about elk. They have a surprising connection to some seafaring and jungle mammals, and they sometime like to chuckle.

Like every member of the deer family, bull elk like to hang with other males while the cows band together with the calves. When mating season starts, bulls starting as young as two years use their bugle to find a mate.

The bugle starts low, gradually climbs to a high note, hangs onto the high note and then drops back to the low note with a gruff at the end. That high note, as distinctive as it is curious, doesn’t match the 700-pound-plus source because it doesn’t come from the bull’s vocal cords.

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Scientists discovered the high note is more of a whistle produced in an area called the glottis, situated between the bull’s vocal cords in the throat and then projected through the nasal cavities. The call can measure as high as 4,000 Hz and carry for miles.

Sometimes the bull adds a series of sharp guttural sounds called a chuckle. The bull also uses a special glunking sound to communicate with cows. The call, produced deep in the bull’s throat, sounds like a squishy thump.

Cow calls are short and naggy with an occasional long and strong screech. A calf call is tiny and light, like the mew of a cat.

The bugling can start as early as late August from bulls 4 years and older; younger elk start in September. If you catch sight of an August bugler, he will probably have an impressive rack.

“A lot of people talk about elk horns,” said Allen Zufelt, Arizona Game & Fish Region 2 Terrestrial Game Specialist. “They’re not horns, they’re antlers, and they’re shed every year. They will continue to increase in size until they’re 6 to 8 years old. After that they’ll decrease in size.”

Both genders of elk have two canine teeth. They’re remnants of tusks, like walruses, elephants and wild boars have, that their prehistoric ancestors once had.

“They’re ivory teeth,” Zufelt said. “The same residual kind of canine located in their upper jaws.”

The elk that currently roam the state are Cervuc canadensis or Rocky Mountain elk. But Arizona once had a native elk population whose existence didn’t trickle into scientific circles until 1882 when renowned naturalist E.W. Nelson started tracking the clan. By the time Nelson penned a report on the elk for the American Museum of Natural History in 1902, the species had been extirpated.

Nelson called Arizona Elk, which he referred to as Cervus merriami, as “the last of the large game mammals to become known to science in America.” The species stayed under the radar because of their isolated existence in an area where, Nelson wrote, “the idea of game protection is very recent.”

At the time, the elk in the U.S. had been dwindling from an estimated 10 million and would eventually reach a low of 90,000; that’s almost half of the remaining elk lived in and around Yellowstone National Park. The park ended up transplanting more than 13,500 Rocky Mountain elk, to points around the nation from 1912-1967. During that time, 217 came to Arizona.

When the transplantations started, George Hunt was governor of Arizona and a member of the Elks U.S.A. Globe lodge. He and Winslow lodge member C.M. Bledsoe coordinated Arizona’s first shipment that traveled by train on January 31, 1913 to Winslow, Arizona. The elk were then wheeled by wagon to a draw in the Chevelon Canyon system. Two shipments of transplants to other locations in Arizona occurred in the 1920s.

The Arizona Game & Fish Department (AGF) estimates Arizona currently has about 35,000 elk that are all descendants of the Yellowstone transplants, and they sure have gotten around.

“Elk in general are very nomadic,” Zufelt explained. “We have elk that moved to all habitats, from the tops of the San Francisco Peaks to as far as some of the canals around Yuma. They’re originally a plains animal, and they are very good at living in almost any habitat. Once they get to a place, they’re pretty good at persisting.”

That would describe the elk that wandered up to the Grand Canyon National Park from Williams and Flagstaff sometime around 1966. About 95% of the park elk remain in and around Grand Canyon Village; a 2015 survey counted 200. Though they must mingle with millions of visitors, they hydrate from precipitation that collects on the ground, puddles that form at water stations and quick nips of nectar from hummingbird feeders; they find food in the form of forb, grass and visitor handouts; and they have no predators. Life, in other words, is good.

If you’re interested in spotting elk, you don’t have to travel far to find them. AGF game specialists have been flying elk surveys in the area, and Zufelt reported they spotted 3,000 in the past week.

“One of the best places a person has to more or less guarantee seeing elk this time of the year is Mormon Lake,” Zufelt said. “The elk make use of the lake bottom in the summertime. They’ll be breaking up in the next couple of weeks as hunting season starts and they’ll be breeding. So they’ll move around a little bit. But there were 150-200 elk out in the lake bottom just the other day.”

If you go to Mormorn Lake, be careful. Elk accidents have decreased substantially along the freeways due to customized fencing. But the smaller roads, like Lake Mary Road, still have frequent elk crossings.

“The best thing I can say is slow down when you’re driving at night,” Zufelt advised. “Drive courteously and pay attention, so you’re not distracted because it just takes a split second for an elk to step out in front of you.”

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The post Northern Arizona’s storied relationship with elk appeared first on DAILY SAN FRANCISCO BAY NEWS.

If you happen to visit Portland, you’ll feel right at home. It’s San Francisco 2.0. Or, perhaps, it’s the reverse. No matter. The two are nearly identical twins, at least when it comes to a variety of factors, both good and bad.

The West Coast weather is similar. Attractive water and impressive bridges grace both cities. And then there’s the societal decay. The depressing evidence is visible in too many grimy precincts. We had the misfortune of viewing some of it (too much of it, really) on a journey north late last month.

Portland’s fetid homeless encampments pop up with unfortunate regularity just like those in the once-proud city by the Bay. These makeshift dwellings house a compromised and vulnerable population marked by drug abuse, public toilet habits, occasional violence and unrelenting (and expensive) dysfunction.

Like the harried policymakers in San Francisco, those in Portland are consumed by the trials and tribulations (not to mention the costs) of the unhoused, not to mention their off-putting effect on the voting populace at large, including the business and tourist interests held hostage by all of this.

It’s no wonder that, like our own fading metropolis to the north, Portland has lost thousands of its residents over the last several years.

It’s a shame, really. The natural beauty in Portland and its surrounding towns and landscapes remains stunning. Not so much the city itself.

Welcome to San Francisco’s sibling in the northwest. Let’s not even mention Seattle. That’s another sad, though similar, tale.

RAIL BOONDOGGLE WILL NOT DIE: Government, at all levels, is confronting limitations on the spending of taxpayers’ dollars. What a concept.

At the same time, public transit agencies are begging for funding help due, in large part, to a dramatic decrease in ridership, largely due to work-related commute changes caused by the pandemic.

The timing is poor. That’s obvious. But some significant funds are being provided. Whether they will be enough to save transit agencies from major service reductions remains to be seen.

One particular entity, the state’s High-Speed Rail Authority, continues to prove that, no matter how obvious its deep and abiding fiscal flaws may be, cash will still flow.

The latest state budget includes the release of $4.2 billion to keep HSR construction going in the Central Valley. So the monetary life support for this manifestly mistaken operation goes on — and on.

For the many persistent critics of HSR over the past 15 years, anything that helps it to limp along and devour public dollars in the process is a cause for the gnashing of teeth and murmurs of frustration. Lawsuits against the project have come to naught.

The fast-train fiscal folly seems impervious to any and all efforts to drive a stake in it and kill it off once and for all. It’s a public-spending nightmare, a transit vampire devouring vast, endless sums, that simply refuses to die.

KRON’S ABSENCE EASILY HANDLED: Absence does not always make the heart grow fonder. That counter to a bit of accepted folk wisdom has certainly applied to the troubled condition of KRON TV-Channel 4. As the week began, customers of AT&T cable and Direct TV had been without KRON through July due to a financial dispute.

The impact appeared to be negligible. Or as that former KRON anchor/sage Gary Radnich might have put it: “Nobody cares.”

Some would-be viewers may well care, but not enough of them to make much of a difference. There are plenty of local KRON competitors out there selling the same sort of programming.

Sedentary life on the couch, such as it is, has gone on — with or without the presence of KRON on AT&T big screens.

TWO MORE MERIT WINNERS ADDED: Two more San Mateo County students of the high school Class of 2023 have received National Merit Scholarships, according to a supplementary list of winners released this week.

The local honorees are Joshua Yang of Carlmont High School in Belmont and Eli Zimmerman of San Mateo who attended Kehillah Jewish High School in Palo Alto.

For Carlmont, the latest local addition brings its National Merit total to nine, the most (by far) of any secondary school in the county this year.

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