Date: Jan. 26, 2024 Contact: newsroom@ci.irs.gov LOS ANGELES — Former Los Angeles City Councilmember José Luis Huizar was sentenced today to 156 months in federal prison for using his powerful position at City Hall to enrich himself and his associates, as well as for cheating on his taxes. Huizar of Boyle Heights, was sentenced by United States District Judge John F. Walter, who also ordered him to pay $443,905 in restitution to the City of Los Angeles and $38,792 in restitution to the IRS. Judge Walter ordered Huizar to surrender to federal authorities no later than April 30. At today’s hearing, Judge Walter said public corruption carries “the real potential to destroy the delicate fabric of our democracy” and causes the public “to disengage in the democratic process” and “give up all hope of participating” with the government. Huizar pleaded guilty in January 2023 to one count of conspiracy to violate the Racketeer Influenced and Corrupt Organizations (RICO) Act and one count of tax evasion. He represented Council District 14 (CD-14), which includes downtown Los Angeles and its surrounding communities, from 2005 until his resignation in 2020. “No one is above the law,” said United States Attorney Martin Estrada. “Today’s sentence shows that even a powerful elected official like Huizar will be held accountable for engaging in criminal misconduct. Huizar was elected to serve the interests of the hard-working people of Los Angeles, but he instead served his own personal interests in a long-running, pay-to-play, bribery scheme. Our community deserves better.” “This years-long investigation uncovered one of the most audacious public corruption cases in this city’s history,” said Donald Alway, the Assistant Director in Charge of the FBI’s Los Angeles Field Office. “This case would not have been possible without the dedication of agents and prosecutors – and importantly – the cooperation of many citizens who were fed up with rampant malfeasance by public officials. Mr. Huizar ignored the needs of his constituents and instead, served his own interests by accepting bribes and a wide assortment of luxury perks from wealthy real estate moguls and others who could afford Huizar’s political favors at the taxpayer’s expense. My hope is that this case brings more citizens forward to the FBI when they suspect corrupt practices and foreign influence.” For years, Huizar led what prosecutors in court documents called the CD-14 Enterprise, a criminal conspiracy that operated a pay-to-play scheme with three key goals: gain financial enrichment through bribes, maintain Huizar’s political power, and avoid detection by law enforcement. By leveraging his position as CD-14’s councilmember and chair of the Planning and Land Use Management (PLUM) Committee, which oversaw all major commercial and residential development projects throughout the entire city, Huizar – assisted by others – sought nearly $2 million worth of benefits in bribes from real estate developers and their proxies. The benefits ranged from cash bribes, casino gambling chips, prostitution services, political contributions, flights on private jets and commercial airlines, stays at luxury hotels and casinos, expensive meals, tickets to concerts and sporting events, and other things of value. In exchange for these benefits, Huizar used his positions of public office to take official acts and give favorable treatment towards the projects of the paying real estate developers. Huizar facilitated at least five bribery schemes. In one of the schemes, Huizar solicited $500,000 in cash for himself and his co-conspirators from developer David Lee in exchange for taking an official act to resolve an appeal by a labor organization against Lee’s project. In another scheme, Huizar accepted more than $1 million in benefits from billionaire real estate developer, Wei Huang, in exchange for pushing future approvals of the redevelopment of Huang’s hotel into the tallest tower west of the Mississippi. To maintain his political seat, which was threatened by a sexual harassment lawsuit in 2013, Huizar also schemed to surreptitiously route $600,000 in the form of collateral from Huang through a foreign shell company, which Huizar used to confidentially settle the lawsuit. Huizar similarly concealed his many other bribes, including by laundering cash through his mother and brother, and by omitting his financial benefits on his tax returns. When Huizar’s final term for the CD-14 Council seat was set to expire in 2020, Huizar pushed his wife, who had never held public office, to run as his successor, then used the CD-14 Enterprise and the pay-to-play scheme to extract campaign contributions that would allow him to maintain political power through her. Instead, Huizar, while he was still in office, was ultimately indicted in July 2020 on the charges in this case, and he resigned from his council and committee positions later that year. As part of his plea agreement, Huizar also admitted to obstructing justice, including by tampering with two witnesses, and lying to federal prosecutors and federal agents. In a sentencing memorandum, prosecutors described how Huizar chose “to place his own lust for money and power above the rights and interests of the people he was elected to serve” and “[i]n the wake of his criminal activity…helped gut the public’s confidence in the integrity of its local government – and beyond – and eroded a sense of fair play therein.” “Mr. Huizar was entrusted with making decisions in the best interest of Angelenos. Instead, he leveraged his position to enrich himself and his close allies in a mafia-style organization. His greed further emboldened him to hide his criminally gained profits from the IRS, which was a big mistake,” said Special Agent in Charge Tyler Hatcher, IRS Criminal Investigation, Los Angeles Field Office. “IRS Criminal Investigation (CI) is the best in the world at following the money, and by teaming with our federal partners we will aggressively investigate corruption at every level.” Other defendants charged alongside Huizar in the indictment are: Dae Yong Lee, a.k.a. “David Lee,” of Bel-Air, a real estate developer who is serving a six-year prison sentence for his convictions for honest services wire fraud, bribery, and falsification of records in a federal investigation. 940 Hill LLC, a Lee-controlled Los Angeles-based company, which was convicted of the same crimes as Lee and sentenced in July 2023 to five years of probation, fined $1.5 million, and ordered to pay the costs of prosecution. Wei Huang of Shenzhen, China, a billionaire real estate developer who is charged with several felonies, has yet to make a court appearance in this case and is a fugitive believed to be in China. Shen Zhen New World I LLC, a downtown Los Angeles-based company convicted – through the actions of its owner, Huang – of paying more than $1 million in bribes to Huizar, including the $600,000 sham loan. The company was sentenced in May 2023 to five years of probation, fined $4 million, and ordered to pay the costs of prosecution. Raymond She Wah Chan of Monterey Park, a former Los Angeles deputy mayor, has pleaded not guilty to charges of RICO conspiracy, bribery, honest services fraud and lying to federal agents. His retrial is scheduled to begin on March 12. Other defendants in related criminal cases stemming from this corruption matter are: Justin Jangwoo Kim of Mar Vista, a political fundraiser who pleaded guilty in June 2020 to one count of bribery and is scheduled for sentencing on June 21. Morris Roland Goldman of Porter Ranch, a lobbyist who pleaded guilty in September 2020 to one count of conspiracy to commit bribery and honest services fraud and is scheduled for sentencing on July 12. George Chiang of Granada Hills, a real estate development consultant who pleaded guilty in June 2020 to one count of racketeering conspiracy and is scheduled for sentencing on July 19. George Esparza of Boyle Heights, Huizar’s former special assistant, who pleaded guilty in July 2020 to one count of racketeering conspiracy and is scheduled for sentencing on July 26. Salvador Huizar of Boyle Heights, José Huizar’s brother, who testified as a witness for the prosecution in the Shen Zhen trial and pleaded guilty in October 2022 to a felony charge of making false statements to federal investigators. His sentencing hearing is scheduled for August 2. The FBI investigated this matter with assistance from CI. Assistant United States Attorney Mack E. Jenkins, Chief of the Criminal Division, and Assistant United States Attorneys Cassie D. Palmer, Susan S. Har, and Brian R. Faerstein of the Public Corruption and Civil Rights Section, are prosecuting this case. CI is the criminal investigative arm of the IRS, responsible for conducting financial crime investigations, including tax fraud, narcotics trafficking, money-laundering, public corruption, healthcare fraud, identity theft and more. CI special agents are the only federal law enforcement agents with investigative jurisdiction over violations of the Internal Revenue Code, obtaining a more than a 90 percent federal conviction rate. The agency has 20 field offices located across the U.S. and 12 attaché posts abroad.
