Lobbyist agrees to plea deal in L.A. City Hall corruption case
Longtime lobbyist and former Los Angeles City Hall official Morrie Goldman on Tuesday became the latest figure to fall in an ongoing pay-to-play investigation, agreeing to plead guilty to a charge that he conspired with Councilman Jose Huizar in a bribery scheme.
Federal prosecutors say that Goldman, 57, was part of a ploy in which one of his clients, a real estate developer seeking city approval for an Arts District complex, agreed to give tens of thousands of dollars to a political action committee in exchange for Huizar taking steps to help the project.
Prosecutors in the case have described the Arts District tower as an example of the effect of the alleged bribery scheme: Huizar backed recommendations for that project to have a smaller share of affordable units than a city commission wanted, which provided an estimated $14 million in savings for the developer, according to the charging documents.
The U.S. attorney’s office announced that Goldman had agreed to surrender in the case and make his first court appearance Sept. 23. He has agreed to plead guilty to a charge of conspiracy to commit bribery and honest services mail fraud. The felony charge could lead to a maximum penalty of five years in federal prison.
Huizar was arrested and charged in June, leading to his suspension from the City Council. He has since pleaded not guilty to dozens of charges including bribery, money laundering and mail fraud.
Steve Meister, an attorney representing Goldman, called the case “a cautionary tale,” describing the longtime lobbyist as “a person of integrity with a previously unblemished record.”
“He allowed himself to become part of the orbit of a very corrupt man, and he ended up participating in things that he never would have imagined doing,” Meister said. “But he is reclaiming the moral ground that he ceded to Jose Huizar.”
Meister said Goldman would continue to cooperate in the investigation and “is going to do everything that he lawfully can, for as long as it takes, to make things right.”
Under the terms of the plea deal, if prosecutors determine Goldman has provided significant help, they will ask the judge for added leniency during sentencing. The plea agreement filed Tuesday by prosecutors indicated that Goldman had entered into an earlier agreement with them Nov. 15, 2018 — roughly a week after the FBI raids targeting Huizar.
As L.A. officials battle the coronavirus pandemic, a corruption scandal has fueled mistrust in City Hall.
In the charging documents the government filed against Goldman, prosecutors detailed what they allege were years of careful plotting by Goldman and Huizar to pressure real estate developers to contribute to a political action committee that Huizar would use to help get his wife elected to his council seat as he neared term limits.
Richelle Huizar, the wife of the councilman, ran briefly for his seat before the FBI raided the Huizars’ home and the councilman’s offices in 2018. Goldman is listed in state records as a principal officer with Families for a Better Los Angeles, a committee that was described to donors as a way to support Richelle Huizar in her planned 2020 run for council.
Prosecutors alleged that in a May 2017 call between Goldman and Huizar aide George Esparza, Goldman spelled out the plan to create a political fund that on paper would be independent from Huizar and would raise money for a variety of issues, but in reality would be used chiefly to assist Richelle Huizar as she ran for the council seat.
“You and I can run [the PAC]. But we need someone who can be the face of it,” to conceal Huizar’s involvement, Goldman told Esparza, according to the charging documents filed by prosecutors.
As plans for the fund progressed, Goldman continued to press Huizar to find someone loyal to him to be the nominal head of the fund, according to prosecutors. At one point, Goldman dissuaded the councilman from letting Justin Kim, a political fundraiser who has since pleaded guilty in the corruption case, find someone to front the fund.
Huizar said he initially thought it would be “cool” because it would appear that the committee was more distant from him if the frontman were “some random Korean,” but agreed it would be too risky, reasoning that if he had a “falling out” with Kim, he’d be powerless to wrest control of the money, according to the charging documents.
Goldman replied, “I mean, in an ideal world, I mean, we’re all friends, we’re all loyal, but you know, things happen. I just want to make sure you’re protected.”
As they worked out the plans for the political committee, Goldman also kept an eye on the needs of his lobbying clients, according to the charging documents. During one phone call about political donations, Goldman told Esparza he needed the city to help with a digital billboard ordinance that would affect one of his developer clients, prosecutors wrote.
“I like this client. They pay me a lot of money,” Goldman said, according to the charging documents.
Huizar, Goldman and a Huizar associate who has not been named by prosecutors soon began meeting every other week to discuss their progress wrangling donations for the committee, the charging documents state. The councilman provided a “fundraising plan” that listed potential donors and who was responsible for landing them, prosecutors allege.
Goldman, for example, was assigned to eight potential donors — including developers with projects pending at City Hall — to bring in $275,000, according to the court filings. Huizar was responsible for a dozen targets that could bring in $680,000.
Prosecutors zeroed in specifically on donations from one company that retained Goldman as a lobbyist. Its Arts District project has not been identified by name in court, but details in the criminal complaint against Huizar make clear that it is 520 Mateo, a 35-story tower pursued by Carmel Partners.
Huizar supported the development over the objections of labor groups and neighbors who lodged appeals. The councilman told Goldman that opposing a labor union could hurt the upcoming campaign for his wife, so the developer “would have to make it worthwhile,” according to the charging documents filed by prosecutors.
The U.S. attorney’s office said Tuesday that over the course of roughly two years, the developer agreed to $150,000 in political donations to committees favored by Huizar, but ended up providing only $75,000 after the final payments were derailed by the FBI raids on Huizar’s home and offices.
The pledged money included a $50,000 commitment to the committee supporting Richelle Huizar, which the councilman agreed to in exchange for approving the project over union objections, prosecutors said in the charging documents.
Carmel Partners did not immediately respond Tuesday to a request for comment. In a previous statement, the San Francisco company said that members of its executive and management committees did not knowingly participate in any pay-to-play scheme. The company also said that its political donations were legal and argued that they were not the reason the project was approved.
At the time, Carmel Partners also announced it had put one of its executives on leave and said it was exploring legal action against the lobbyist it relied on for the Arts District project, stating that the criminal complaint against Huizar revealed the unnamed lobbyist was “deceptive” in his advice.
Goldman is the sixth defendant to be charged in the ongoing investigation, which has also netted guilty pleas from Esparza, former Councilman Mitchell Englander, and other figures active in real estate and city politics.
Before opening his lobbying firm in 2004, Goldman worked as a high-level aide to former Los Angeles City Councilmen Mike Hernandez and Hal Bernson.
As a lobbyist, Goldman has represented companies developing some of the biggest projects in Huizar’s district, including the $1-billion Grand Avenue complex across from Walt Disney Concert Hall and the 6 AM project, which seeks to bring two 58-story skyscrapers to 6th and Alameda streets. His firm has raised hundreds of thousands of dollars for city politicians.
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