FBI Relied Heavily on Secret Tapings in Sting

FBI undercover operatives recorded conversations with at least 11 people, including six elected officials, during their investigation into political corruption at the state Capitol, according to sources familiar with the probe.

In several cases, an FBI agent used a video camera hidden in her purse to record discussions between undercover operatives and elected officials at restaurants in the Sacramento area.

In another instance, the FBI lured away a legislative aide to Assemblywoman Gwen Moore (D-Los Angeles) in 1987 so an agent posing as a businessman could approach the lawmaker directly to talk about legislation that would have benefited a bogus company set up by federal investigators.

While Moore talked into a hidden microphone, her aide, Tyrone Netters, was also taped as he enjoyed a lunch featuring a $50 bottle of wine at a restaurant several miles from the Capitol.

According to sources familiar with the investigation, undercover agents and informants regularly used video and audio recordings in contacts with their targets as they gathered evidence in the three-year sting operation, code-named Brispec (for bribery-special interest) by the FBI.

Among the 11 known to be taped were Moore, Assembly Republican Leader Pat Nolan of Glendale, Assemblyman Frank Hill (R-Whittier), Sen. Joseph B. Montoya (D-Whittier), then-Sen. Paul Carpenter (D-Cypress), now a member of the State Board of Equalization, and Yolo County Sheriff Rod Graham.

Others who were taped include Netters; Senate aide John Shahabian, who later became an informant for the FBI; Karin Watson, an aide to Nolan; former Assembly aide Darryl O. Freeman, who became a lobbyist for a phony FBI company, and Wendell Luttrull, a top aide to Graham.

In June at a restaurant near the Capitol, Montoya was videotaped while having breakfast with Shahabian and an undercover agent known by the name of George Miller.

In this taping session, the FBI relied on the woman agent sitting at a nearby table to videotape the proceedings.

During the breakfast they discussed the fact that Carpenter had already received $20,000 in campaign contributions from Gulf Shrimp Fisheries Inc., a bogus company created earlier by the FBI, according to a source.

“That Paul, he always got the sweet deals,” the source quoted Montoya as saying.

Montoya has acknowledged that he received a $3,000 honorarium from Peachstate Capital Investment Ltd., the successor to Gulf Shrimp.

Reached by The Times, Montoya declined to discuss the June meeting, saying, “I can’t answer any more questions. The FBI may be listening.”

‘Like a Little Lamb’

Earlier, however, in talking about the breakfast meeting with the San Francisco Chronicle, he said: “I went like a little lamb to the slaughter.”

The agent who videotaped Montoya also filmed a 1986 lunch meeting at a restaurant where an undercover operative handed Yolo County Sheriff Graham a $1,500 check, sources have said. Also present at the meeting was Luttrull, Graham’s top deputy.

The money was delivered by FBI informant Marvin Levin, a Sacramento-area developer who says the payment was in response to Graham’s promise of extra protection for Lighthouse Marina, a $600-million project on the Sacramento River. Graham did not report the money, either as a campaign contribution or as income on his required statement of economic interests.

On one occasion in 1987, undercover operatives took great pains to meet alone with Assemblywoman Moore so they could discuss their legislation and campaign contributions in a tape-recorded conversation, sources familiar with the investigation said.

Moore had carried a bill in 1986 to benefit Gulf Shrimp, and the “company” had given her $5,000 in campaign contributions that she returned three days later, saying the donation was “inappropriate.” But FBI agents had rarely dealt directly with Moore, instead conducting most of their business with her aide, Netters.

To make sure that Netters was not on the scene, Levin invited him to an expensive lunch. FBI agents had instructed Levin to buy the most costly bottle of wine on the menu in order to impress Netters.

Then, an undercover FBI agent, who went by the name of Jack Gordon, arrived at Moore’s office and approached her as she was going out the door. Gordon, wearing a hidden tape recorder, attempted to draw Moore into a discussion of Gulf Shrimp’s campaign donations and its efforts to win approval of legislation, according to one source familiar with the investigation.

What Moore and Gordon said on the tape remains unclear. Moore is not talking about the investigation, and federal officials have not released any of the scores of tapes they have obtained during their probe.

The incident is the only time in 1987 that the FBI is known to have engaged in undercover operations in the Capitol. For the most part, their activities focused on bills unwittingly carried by Moore for the FBI’s phony companies in 1986 and 1988.

In a separate development, Legislative Counsel Bion Gregory has hired his own attorney to represent him in what may become a legal battle for custody of backup computer tapes that may show evidence of illegal use of state computers for political purposes.

Hours after the FBI’s Aug. 24 raid on the Capitol, Assembly Republican staff members began purging political documents from their computers.

Gregory’s attorney, William Shubb of Sacramento, would only confirm that he is representing the legislative counsel “in connection with the matters under investigation by the U.S. attorney in Sacramento.”

In the wake of the FBI raid, one employee in the legislative data center, which is under Gregory’s control, acted to save documents purged from office computers. Another employee was ordered to prepare the tapes for erasure but refused and instead notified the FBI. Both employees were placed on administrative leave with pay.

However, it is unclear whether the FBI has obtained possession of the tapes. One legislative employee said the tapes had been turned over to FBI agents, but another source told The Times that they have been put in a “neutral place.” Neither the FBI nor the U.S. attorney’s office would comment on the matter.

Times staff writers Mark Gladstone and Daniel M. Weintraub contributed to this story.