Wednesday, December 1, 2021

SoCal Officials Spotlight Federal Marijuana Licensing Investigation

The Times learned that a federal grand jury issued subpoenas requesting information on cash and other payments to government officials and cannabis consultants as part of a criminal investigation into the licensing of marijuana in Baldwin Park and surrounding towns.

Federal authorities, including FBI and IRS agents, are questioning witnesses and looking for a wide range of records regarding Baldwin Park city officials who approved cannabis licenses and consultants who helped businesses obtain permits, according to interviews and a copy of the jury subpoena. reviewed by The Times.

According to the agenda and interviews, the agents are also investigating links between Baldwin Park businesses and consultants who have obtained or requested cannabis licenses in other cities, including Montebello and El Monte.

Subpoena following a series of scandals in Baldwin Park, a 6.8-square-mile town 23 miles east of Los Angeles, in the heart of the San Gabriel Valley.

Late last year, The Times reported that FBI agents had served search warrants at the city’s attorney’s office and at the homes of two officials in other cities as part of an investigation into cannabis licensing and allegations that Baldwin Park officials were receiving illegal payments from businesses seeking permission. …

A former Baldwin Park City Councilor who was an early proponent of legalizing cannabis pleaded guilty to a separate federal case after admitting to accepting tens of thousands of dollars in bribes from a police officer to vote for a police union contract, according to the federal government. … court records that were printed earlier this year. He agreed to cooperate with the authorities in ongoing investigations of public corruption.

AND state audit Last year, the city was found to be poorly governed and deficiencies in accounting practices noted. The audit also raised concerns about wasteful expenses, including an engineering project that was never completed but cost taxpayers more than $ 500,000.

The 2017 City Council-approved commercial cannabis licensing program is mired in allegations of bribery, conflict of interest and bias.

In a sworn statement filed last year in an unrelated lawsuit, former Baldwin Park Police Lieutenant Christopher Kubery, who was in charge of inspecting cannabis businesses, said three operators had complained to him about questionable practices in the city and “the need payment of USD 250,000. brown paper bag to city officials.

The scope of the subpoenas includes requests for meeting reports, emails and payments to any city cannabis consultants and Baldwin Park councilors, as well as any entries related to cannabis consultants or cannabis licensing in cities outside Baldwin Park.

FBI agents inquired about the Baldwin Park cannabis consultants who assisted the claimants in El Monte and Montebello, according to sources interviewed by federal agents. The sources spoke on condition of anonymity as they did not have permission to publicly discuss the investigation.

A spokesman for the US Attorney’s Office declined to comment. An FBI spokesman declined to comment on the subpoenas, but said the investigation was ongoing.

A grand jury agenda reviewed by The Times also requires entries regarding Atti Baldwin Park City. Robert Tafoya. In October 2020, FBI agents ransacked Tafoi’s downtown Los Angeles office, as well as the homes of Isaac Galvan, Compton City Councilor, and Gabriel Chavez, who was the San Bernardino County Planning Commissioner.

Chavez declined to comment; Galvan could not be reached for comment.

Mark Werksman, a lawyer representing Tafoya, said he knew that a federal grand jury had issued subpoenas, but that authorities had not contacted his client.

“He is a hardworking, honest lawyer for the city who has never done anything illegal or broken the law,” Werksman said. (Werksman represented Times reporters on unrelated issues.)

Baldwin Park City Atti. Robert Tafoya.

(Glenn Koenig / Los Angeles Times) #

Tyopha began working at Baldwin Park on a contract basis in 2013 and has had a controversial reputation. In 2017 he drew up a contract stating that the chief of police could only be fired if he committed a felony and prevented the chief from receiving annual assessments from the city authorities.

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Tafoya developed and negotiated cannabis development agreements for the city. This sparked controversy when one company, Rukli Inc., became the sole distributor of Baldwin Park, requiring other cultivators and growers to use Rukli to transport their produce.

Two cannabis companies have filed lawsuits alleging that the distribution agreement created a monopoly. Ultimately, the city renegotiated negotiations with Rukli, requiring the firm to relinquish its exclusive distribution rights in exchange for free growing and production permits. The city also waived the $ 300,000 fee.

Baldwin Park Mayor Emmanuel Estrada said in a telephone interview that he is concerned about the agreements that Tafoya has made with the cannabis factories. Some were charged city fees, others were not, and some were required to be prepaid, and others were allowed to pay after they were operational, he said.

Estrada said he was not aware of the federal grand jury investigating the licensing of Baldwin Park’s cannabis, and he had not heard of any subpoenas at City Hall. Tafoya is no longer involved with cannabis issues, he said, and the city has hired a new attorney to take over the cannabis licensing program.

Last year, Tafoy hired Anthony Willoughby II as a contract attorney at Baldwin Park to deal with cannabis-related matters. His father, Anthony Willoughby, is also a lawyer and initially represented Galvan after being served with a search warrant by the FBI.

Local activists and a lawyer representing the cannabis company questioned the hiring of young Willoughby.

In 2018, Willoughby II was vice president of Tier 1 Consulting & Advocacy and has a cannabis cultivation agreement with Baldwin Park, city reports show.

In response to questions from The Times by email, Willoughby II said his father owned Tier 1 but sold it. Willoughby II said he was a no-ownership employee.

“There is no conflict when a person who has previously worked in a private business in the city takes a job in the city,” Willoughby II said, adding that it was “not a problem”.

One of the new Tier 1 owners, David Joo, told The Times that he and his partner only dealt with Willoughby II when they acquired a cannabis development agreement in April 2019.

Willoughby II said he was unaware of the federal grand jury, received no subpoenas, or contacted federal authorities.

One of the earliest proponents of legalizing Baldwin Park’s cannabis was former Councilor Ricardo Pacheco.

In June 2020, Pacheco pleaded guilty to accepting $ 37,900 in bribes from a Baldwin Park police officer who was a union officers but worked undercover for the FBI.

The bribes paid in 2018 included an envelope of $ 20,000 in cash that the officer gave Pacheco at a cafe in Baldwin Park, under a plea agreement with federal attorneys. The remaining $ 17,900 was distributed through checks written to the Pacheco church and “fictitious political committees” under the names of others but Pacheco’s control, federal officials said in a press release announcing the plea.

The heavily revised plea agreement cites illegal proceeds of $ 219,755 that Pacheco agreed to forfeit, including more than $ 83,000 in cash found at his home and buried in his backyard. The court records do not indicate how he received the money. As part of his plea agreement, he agreed to cooperate with the federal authorities and provide investigators with “physical evidence.”

Pacheco, who resigned from the city council, agreed to cooperate with federal authorities 10 months before his plea agreement was made public, court records show. He is awaiting judgment.

Pacheco declined to comment through his wife, who confirmed that he is in contact with the federal authorities.

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