Nathanson Pleads Guilty to 2 Federal Counts

Former California Coastal Commissioner Mark L. Nathanson has pleaded guilty to federal charges that he used his public office to extort payments from Hollywood celebrities and others seeking permits to build along the coast, the U.S. Attorney’s office announced Wednesday.

In exchange for Nathanson’s guilty plea to felony racketeering and tax evasion charges, as well as a promise of full cooperation in the government’s ongoing state Capitol political corruption probe, prosecutors have agreed to drop five of seven criminal counts against him. They will recommend that he serve no more than five years and three months in federal prison.

Depending on the results of Nathanson’s assistance, his sentence could be reduced even further, perhaps by half, said acting U.S. Atty. Robert M. Twiss.

“We have reason (to believe) that he could, in fact, provide substantial assistance in cases which have not yet been indicted and prosecuted,” Twiss said.

Nathanson’s decision to cooperate adds to the momentum of a federal investigation of corruption that began in 1986 and has resulted in the indictment or conviction of 14 people, including five legislators, five legislative aides and one of the Capitol’s most powerful lobbyists.

Never elected to office himself, Nathanson has a long history of political fund raising and appointments to government jobs by powerful public figures, including Assembly Speaker Willie Brown (D-San Francisco), Los Angeles Mayor Tom Bradley, Los Angeles County Supervisor Mike Antonovich and ex-Gov. Edmund G. (Jerry) Brown Jr.

The plea agreement is certain to add weight to the theory--repeatedly denied by prosecutors--that the ultimate target of the federal probe has been Speaker Brown, who appointed Nathanson to the coastal panel.

In response to questions, prosecutor Twiss took pains to point out that the charges filed against Nathanson are not connected to Brown.

“There is nothing in the four corners of this case, tying in any way to Speaker Brown,” Twiss said. “There is clearly no tie whatsoever.”

However, the prosecutor limited his comments to the current case against Nathanson and declined to comment further “with regard to any other potential target, who might be tied in any way to Mark Nathanson.”

Brown, who has asserted that he has been a target of the investigation, could not be reached for comment following the plea bargain announcement, but one of his aides attended the federal prosecutor’s news conference.

Nathanson, 53, formally entered his plea late last Thursday, but the agreement was kept under seal until this week. Twiss would not explain the reasons for that unusual action except to say “that one of the conditions of the plea agreement is that the defendant, as a condition of the plea, (promised) to cooperate in ongoing investigations.”

Until Wednesday, Nathanson and his attorneys had vigorously denied any wrongdoing.

In a detailed statement of the facts of his case filed in federal district court here, Nathanson admitted to using his position as a Coastal Commissioner in a dozen extortion attempts--some successful and others not--between 1986 and 1990.

Among his intended victims were such Hollywood luminaries as actor Sylvester Stallone, former Fox Inc. chief Barry Diller, and producer-agent Sandy Gallin--all of whom were seeking permits before the powerful Coastal Commission, which has the final say on construction permits along much of California’s 1,100-mile coastline.

But in a statement issued Wednesday, Nathanson’s attorney, Stephen L. Braga, warned that there were inaccuracies in the court document. Braga declined to elaborate.

The prosecution document describes an appointed officeholder run amok, intent on using his office for personal gain and going to lengths to cover his tracks.

Most of the intended extortion victims described in court filings, including Stallone, who was asked for $25,000, and Diller, who was hit up for $50,000, refused to make the payments, even under threat that they would be denied permits needed to make improvement on their Malibu homes.

But a number did comply.

Among those who made payments were Gallin, movie producer and agent to such superstars as Michael Jackson and Dolly Parton. According to the court documents, Gallin paid Nathanson $35,000 in 1987 for help with a coastal permit needed for improvements on his Malibu home. And again in 1990, Gallin paid Nathanson a total of $24,000 in cash in three installments for help with permits needed for construction of a new home in nearby Point Dume.

Nathanson also admitted that together with former state Sen. Alan E. Robbins, he extorted almost $250,000 from a San Diego hotel developer.

As part of the plea bargain, the ex-Coastal Commissioner has agreed to repay his share, $118,000, to the developer, Jack Naiman.

Robbins, who has been cooperating with authorities on the Nathanson case as well as others, pleaded guilty to political corruption charges and is now serving a five-year term in the federal prison camp at Boron.

The Van Nuys Democrat would have been a key witness against Nathanson had the case gone to trial.

Nathanson has also admitted extorting a $100,000 loan from retired Pasadena car dealer Jerry Simms, who in 1987 needed a coastal permit to build a lap pool on the beach side of his La Jolla home.

The court documents allege that Nathanson tried to hide the loan by having it paid to his secretary, Mary O’Connor.

Nathanson has also admitted extorting $25,000 from Irwin Winkler, producer of the “Rocky” films, who needed a permit for renovations on his beachfront Malibu home. The documents say that Nathanson had Winkler make the payment through O’Connor in order to conceal it.

In addition, Nathanson tried but failed to extort $200,000 from producer-director Blake Edwards and $50,000 from Disney executive Jeffrey Katzenberg. In both cases, the extortion attempts were made through intermediaries and the film executives turned Nathanson down.

Nathanson has long been a close ally of Willie Brown, raising money for his campaign committees and helping Brown gain entree to the world of Hollywood celebrities. In return, Brown appointed Nathanson to the Coastal Commission and to the California Commission on Aviation and Airports.

This is not the first time that the Beverly Hills real estate broker has been in trouble with the law. In 1974, he pleaded no contest to bribery charges after accepting a $2,500 cash payment from a Hollywood businessman seeking aid with a local building permit.

Nathanson remains free on $150,000 bail, pending sentencing.

Profile: Mark L. Nathanson

Nathanson has pleaded guilty to federal political corruption charges and is headed for prison. He has admitted using his office to extort money from those seeking permits from the California Coastal Commission when he was a member.

* Born: July 9, 1939

* Residence: Beverly Hills.

* Education: Completed high school at the Hollywood Professional School; attended USC for two years, studying business, but earned no degree, according to court records.

* Career highlights: A real estate broker, Nathanson has been appointed to a number of public boards, including the California Coastal Commission, the state Little Hoover Commission, the Metropolitan Water District board and the Los Angeles County Small Craft Harbor Commission. He also has been a reserve officer in the Culver City Police Department.

* Family: Divorced two years ago.