City Hall Insider Quits Post, Kaiser Job

An influential appointee of Los Angeles Mayor James K. Hahn quit both his public post and his private job as Kaiser Permanente’s director of government relations Tuesday after Kaiser officials said an investigation showed he had misused the HMO’s funds for political purposes.

Leland Wong confirmed that he had resigned from Kaiser and his unpaid city position as vice president of the commission that oversees the Department of Water and Power, but he denied any wrongdoing in the handling of Kaiser’s money.

Wong, 46, is a prolific fundraiser and a major behind-the-scenes player in Los Angeles politics. He has emerged in recent years as one of a small number of civic leaders who are tapped to serve as unpaid, part-time city commissioners no matter who is mayor.

Commissioners oversee city departments and have wide latitude in awarding millions of dollars in government contracts. In recent years, Wong has served as president of the airport and harbor commissions as well as at DWP.

Kaiser officials said they asked for Wong’s resignation when they found that he had spent the HMO’s funds improperly by using its staff to organize at least three fundraisers for politicians.

As a nonprofit institution, the HMO is barred by law from holding political fundraisers or making direct donations to candidates, said Richard Cordova, president of Kaiser Permanente’s Southern California operation.

Cordova said the investigation also found that Wong gave politicians tickets to cultural and sporting events that were worth more than the $100-per-person limit on such gifts imposed by city law. The tickets cost Kaiser $8,700 over six years.

Cordova said Kaiser lawyers alerted the city Ethics Commission on Tuesday to what it considered the violations of law. But he declined to name politicians who benefited, saying the Ethics Commission had urged him not to disclose their names.

“What is really sad for us is that Leland was a real community person who represented Kaiser in a number of positive ways,” Cordova said. “But mistakes have been made. We’re an organization that faces up to its mistakes .... We’re apologizing to our members because it’s our members’ money that was used for these things.”

A spokeswoman for Hahn said the mayor would have no comment.

Reached at home late Tuesday, Wong said he was unclear what fundraisers Kaiser officials were referring to.

“They might be mistaking some of the events that I’ve done to bring together community leaders to hear from elected officials about what’s going on in the community,” he said. “There’s nothing wrong with that.”

Wong said he was unaware of a $100 limit on gifts to politicians.

Wong said his department bought Laker season tickets to “build relationships” with community leaders and opinion makers. The tickets had a face value of $187 apiece per game but cost Kaiser more than that because he bought them through a broker, he said.

Political insiders say Wong developed considerable clout because of his position at Kaiser and because of the political fundraising he did on his own time for candidates such as Hahn and his predecessor, Richard Riordan. At Kaiser, Wong shepherded millions of dollars that the nonprofit distributes to charities, labor unions and community groups each year in Southern California.

In 2002, Kaiser reported giving money to more than 1,100 groups, ranging from the United Way and the NAACP to the Irwindale Chamber of Commerce, East Los Angeles Classic Theatre, and 100 Black Men of Los Angeles.

“He’s Kaiser’s guy who hands out the money,” said Los Angeles political consultant Harvey Englander. “I think he is someone council members can go to when they’re seeking money for charities and projects in their districts and he’s willing to step up and write the checks.”

His Kaiser job also entailed lobbying local officials on health-related issues.

Wong was mentioned in an Oct. 23 Times article about the activities of Los Angeles lobbyist and businessman Art M. Gastelum, a close friend of Wong’s. The article quoted a lobbyist and a business consultant as saying that Wong used his position as an airport commissioner in 2002 to try to pressure them to steer a lucrative concession to Gastelum’s daughter. Wong said he made a suggestion but did not exert any pressure.

The district attorney’s office is looking into the matter.

Kaiser officials said they launched their investigation a week after the article appeared, when they received a separate allegation from a Kaiser employee that Wong was getting a kickback from a Kaiser contractor.

Cordova said that allegation was unfounded but the investigation expanded into other areas and led him to place Wong on leave in late November and ultimately ask for his resignation.

Tuesday’s dual resignations by Wong severed his ties with Kaiser after 16 years and ended 14 years of nearly continuous service on city commissions.

Former Mayor Tom Bradley first appointed Wong to the city’s police and fire pensions board in 1989, then moved him to the more prestigious Airport Commission in 1991.

The airport, harbor and DWP boards preside over departments that run some of Southern California’s most important economic engines, collecting huge user fees.

Wong served on the airport board through mid-1993, when he backed Michael Woo’s unsuccessful bid for mayor. Riordan, the eventual winner, named Wong to the Harbor Commission in 1994 after the Kaiser executive avidly supported some of the new mayor’s favorite causes, said one person who knows both men and asked not to be identified.

Riordan moved Wong back to the Airport Commission, where he also continued serving when Hahn became mayor in 2001. Last year, Hahn moved Wong to DWP.

Wong maintains a condominium in Los Angeles’ Angelino Heights neighborhood. Commissioners are required to live in the city.

He and his wife also own a house in San Marino.

Wong said Tuesday that he plans to work as a consultant here and in Asia and to start a bank.

Wong is a member of a group of Asian Americans who have applied to start a state-chartered bank in Arcadia.