3 Councilmen in San Diego Indicted

Three members of the San Diego City Council were indicted Thursday for allegedly taking illegal campaign contributions from the owner of a nude-dancing establishment in exchange for their promise to help make it legal for nude dancers to touch patrons or sit on their laps.

Councilmen Ralph Inzunza, Charles Lewis and Michael Zucchet were indicted by a federal grand jury along with the owner, lobbyist and manager of Cheetah’s Totally Nude Club.

“The people of San Diego have a right to an open and honest government,” said U.S. Atty. Carol Lam. “We are committed to ensuring that San Diego is represented by officials who are free from corrupt influences.”

The three councilmen allegedly agreed to persuade their colleagues to drop a “no-touch” provision in city law that requires dancers to wear at least G-strings and pasties when they approach patrons at nude parlors in search of gratuities.

Cheetah’s owner Michael Galardi and Cheetah’s lobbyist Lance Malone, a former Las Vegas police officer and county commissioner, will surrender in Las Vegas, officials said. Galardi, who lives in Las Vegas, and his father, Jack, own a string of nude entertainment bars across the United States.

The councilmen, protesting their innocence, are set to surrender today for arraignment in federal court.

“I’ve never lied to you, I’ve never let you down, and I love you all,” said Inzunza, addressing his comments to his supporters and constituents.

Attorney Frank Ragen, who represents Lewis, said: “We continue to assert that there has been no bribery and there is no corruption.”

Mayor Dick Murphy, a former Superior Court judge, said he believes that the three councilmen should remain in their posts during the criminal process and not consider resigning.

“If they believe they haven’t committed a crime, they should fight this,” Murphy said. “I spent 15 years as a judge and I presided over hundreds of criminal trials. People were found not guilty in my courtroom.”

Murphy said that these were not the first indictments of San Diego City Council members and not all indictments have ended in convictions -- a reference to a case in the 1970s in which a council majority was indicted for allegedly taking bribes from Yellow Cab Co. One council member was convicted; cases against the others were dropped or ended in not-guilty verdicts.

Zucchet, flanked by his tearful wife and holding their daughter Molly, told reporters that he is confident of being vindicated.

“This has been especially hard on Michael and I because we have a beautiful 3-month-old baby daughter,” Teresa Zucchet said. “We would love to spend our time and energy on parenting her. Instead we’ve had to focus so much attention on this investigation.”

Zucchet’s attorney, Michael L. Lipman, said that “everything Michael did was normal and standard. It happens every day between elected officials and lobbyists.”

Lewis and Inzunza were council aides before being elected to succeed their bosses; both were criticized during their campaigns for taking contributions from associates of the nude entertainment industry. Lewis was elected in 2002; Inzunza was elected in 2001 to fill out the term of now-Assemblyman Juan Vargas (D-San Diego) and then reelected in 2002.

Zucchet was director of governmental affairs for the firefighters union before his election in 2002.

The case against the three was built on conversations recorded by FBI agents through wiretaps and listening devices planted in City Hall. Council members were followed and their cellular telephone conversations recorded, according to the indictment.

In one phone call, Inzunza allegedly promised Malone that lifting the “no-touch” provision would be hidden in an overall review of the city’s nude entertainment law that would include some new restrictions as a smokescreen.

Inzunza allegedly told Malone that the new ordinance would have “four or five things that sort of slaps you guys on the hand and then we’ll allow touching.” In the phone calls, Malone and Galardi allegedly boasted of how much influence their contributions had bought at the City Council.

“So I’ll get Lance down there, just start building little relationships with ‘em,” Galardi allegedly said. “That’s all it takes. Then once they know they can trust us, believe me they’ll ... have that hand out.”

Dancers and owners of nude businesses complain that the no-touch rule costs them money because male patrons are more likely to give money to a naked woman than to one wearing pasties and a G-string.

The rule was adopted by the council in November 2000. At the same time, vice cops vowed increased enforcement of a provision requiring nude dancers to stay at least 6 feet away from patrons.

The indictments were the product of a three-year investigation by the U.S. attorney’s office and the FBI. The case burst into public view on May 14, when FBI agents raided the council members’ City Hall offices and three strip clubs owned by Galardi.

Galardi, Malone and Cheetah’s manager John D’Intino also were charged with trying to bribe a San Diego vice officer to provide warnings whenever undercover officers planned unannounced visits to Cheetah’s in search of violations of the city’s “no-touch” law. The indictment does not suggest that the council members knew of the attempted bribery.

According to the indictment, Galardi and Malone agreed to contribute thousands of dollars to the campaign funds of the three council members but to disguise the origin of the contributions by having other people sign the checks. City law limits individual contributions to $500 and prohibits anyone from reimbursing a contributor.

Although violations of campaign laws are usually dealt with by state prosecutors and the state Fair Political Practices Commission, the case became a federal matter because of the suggestion of bribery, Lam said.

The San Diego contributions reportedly came to light during wiretaps employed by federal authorities in a Las Vegas-based investigation of the strip-club industry. A federal grand jury in Las Vegas also is hearing testimony of possible influence buying.

The alleged covert campaign to change city law never succeeded and faced an uphill struggle even if three council members had supported it. Any bid to change the “no-touch” ordinance would have required five votes on the nine-member City Council and probably would have been opposed by the mayor, city attorney, city manager and police chief, City Hall insiders agreed.

San Diego defense attorney Eugene Iredale said he believes that the indictment, “if it’s not making something out of nothing, is certainly making a lot out of very little.”

Iredale said the three councilmen were engaging only in the “legislative log-rolling” that is part of American politics from the White House to the local city council, where elected officials do the bidding of campaign contributors.

And he decried the fact that the alleged bribery attempt of the police officer by Galardi and Malone was mentioned in the same indictment as that of the council members.

“There is no evidence that the council members knew of that,” Iredale said. “It’s an attempt to smear them by lumping it all together.”

Iredale represented a former Cheetah’s employee who was called by federal prosecutors but ultimately was not required to testify.

The three councilmen were indicted on charges of wire fraud, conspiracy to commit wire fraud and extortion. The wire fraud allegedly involves telephone calls, and the extortion is an outgrowth of the alleged request for money in exchange for legislative favors.

Galardi, Malone and D’Intino were charged with wire fraud, conspiracy to commit wire fraud and interstate travel to aid racketeering.

David Cowan, who is an aide to Lewis, was charged with lying to the FBI.

In a separate indictment, D’Intino and another Galardi associate, Charles Tappe, were indicted on charges of having unregistered firearms, including machine guns, silencers and pistols with obliterated serial numbers.