Carmel Partners agrees to $1M fine in connection with Huizar scandal

Now called CP Employers, developer admitted contributing $75K to ex-councilman’s PAC as firm sought approval for DTLA tower project

Los Angeles /
Jan.January 07, 2021 02:14 PM
Ron Zeff's Carmel Partners has agreed to pay a $1 million fine in connection with the Jose Huizar scandal. (Multi Family Forum, Jose Huziar, SCB)
Ron Zeff’s Carmel Partners has agreed to pay a $1 million fine in connection with the Jose Huizar scandal. Zeff split image at far left and right; Huizar is in middle. (Multi Family Forum, Jose Huziar, SCB)
 

The real estate developer formerly known as Carmel Partners agreed to pay a $1.2 million fine to avoid prosecution in connection with the pay-to-play scandal centered on former Los Angeles Councilman Jose Huizar.

CP Employers — the firm’s new name — acknowledged contributing $75,000 to a Political Action Committee started by Huizar at the same time the developer was seeking approval for a 35-story tower in his downtown district. Departing U.S. Attorney Nicola Hanna announced the agreement Thursday. In exchange for its admission, CP Employers will avoid prosecution in the case for three years.

A company spokesperson noted that the agreement with the U.S. attorney’s office and statement of facts “does not include any admission or finding of criminal wrongdoing by the company or its executives.” Carmel changed its name in recent months, following allegations of its involvement in the scandal.

The announcement is the latest last shoe to drop in the sprawling Huizar case, which Hanna’s office began investigating more than two years ago. Appointed by President Trump, Hanna is stepping down from his position on Friday.

Under Hanna, the prosecutor’s office alleges that Huizar, the former chair of the Council’s powerful planning and land use committee, ran a years-long criminal enterprise. During that period, he allegedly collected $1.5 million in cash and gifts from real estate developers who had projects that required city approval.

CP Employers’ 25-page statement of facts chronicles negotiations with Huizar, including the councilmember asking if he could land a job with the San Francisco-based developer after leaving office.

But the statement also pins wrongdoing on “Executive M,” which CP Employers has since fired, the spokesperson said Thursday. The company did not identify that executive.

Huizar has pleaded not guilty to 41 criminal counts involving racketeering and fraud, with a criminal trial set for June.

Federal prosecutors have also charged two real estate development companies and their executives, 940 Hill LLC and Shenzhen New World Group, in the case. Another developer involved in the probe, Shenzhen Hazens, agreed in October to a similar non-prosecution agreement in which it would pay a $1 million fine.

 


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