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Former L.A. pension board member may have broken ethics law

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A pension board appointee of Los Angeles Mayor Antonio Villaraigosa may have violated city law by accepting a campaign donation from a Los Angeles businessman whose client sought a $10-million investment from the board.

Kelly Candaele, who served until three weeks ago on the board of the Los Angeles City Employees’ Retirement System, received $1,000 on Dec. 2 from Dan Weinstein, managing director of Wetherly Capital Group. That firm pitches investments to city and state pension boards.

The city’s ethics law bars commissioners and board members from accepting or soliciting campaign contributions from anyone who had business before them in the previous 12 months. The law also applies to contributions from those who represent companies seeking board business.

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Candaele voted to invest in a Wetherly client twice last year. Months later, he took a contribution from Weinstein for his campaign for reelection to the Los Angeles Community College District board.

Stephen Kaufman, Candaele’s attorney, described Candaele as an ethical public servant who was unaware he had voted on a Wetherly client before taking the contribution.

“He makes it a point to familiarize himself with the laws governing his conduct as a public official,” Kaufman said.

Candaele voted May 27 and June 24 to allocate up to $10 million in Bond Cos., a real estate fund. Since then, Bond Cos. has had difficulty carrying out plans for Blossom Plaza, a seven-story residential project planned for Chinatown.

The developer, Chinatown Blossom Plaza, filed for Chapter 11 bankruptcy protection two months ago.

Although the pension board approved the investment, no contract has been executed so far between the city and Bond Cos., Wetherly officials said.

Villaraigosa asked Candaele to resign from the city’s seven-member pension board three weeks ago, after The Times inquired about a fundraiser that Candaele held for Councilman Jack Weiss’ campaign for city attorney. Under city law, commissioners are barred from hosting campaign fundraisers for city candidates.

Candaele co-hosted the Weiss event with Weinstein and Richard Ziman, an advisor to Wetherly Capital at the time. In recent weeks, Ziman ended his affiliation with Wetherly, a company spokesman said.

As a community college board member, Candaele held his own reelection fundraiser on Dec. 2, receiving $1,000 from Weinstein and $1,500 from Ziman. The event featured such hosts as Villaraigosa, State Sen. Gil Cedillo (D-Los Angeles) and Councilwoman Wendy Greuel.

Weinstein’s firm has been a subject of interest over the last two months for New York Atty. Gen. Andrew Cuomo, who has been investigating allegations of kickbacks in the New York pension fund.

On Tuesday, former Wetherly employee Julio Ramirez Jr., a San Marino resident, pleaded guilty to securities fraud and agreed to cooperate with Cuomo.

Weinstein said previously that Wetherly was cooperating with investigators. In a statement, he said Candaele was “totally honorable” and would have recused himself had he thought there was any possible ethics violation.

Weinstein also confirmed that he serves on the board of a nonprofit group, More Than Shelter, which has paid Candaele to create tribute videos about honorees for its annual awards dinner.

Weinstein said Candaele, who works in video production, did the job at his own cost and did not make any money from the banquets, the most recent of which was held Thursday.

In addition to his educational duties, Candaele has worked for the Democratic Party’s State Central Committee. He received nearly $20,000 over the last year from the committee for video production work, according to interviews and campaign records.

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david.zahniser@latimes.com


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