When Will the FBI Swoop into Long Beach?

“The worst disease in the world today is corruption. And there is a cure: Transparency.” Bono

On May 16, FBI Agent Brian Adkins filed a criminal complaint with the United District Court for the Central District of California alleging the crime of making false statements to a financial institution against the former Anaheim Chamber of Commerce President, Todd Ament.

The complaint was supported by a 102-page affidavit that began with the agent’s accounting of how he developed his criminal case against Ament, which included 1) A wiretap of a target phone owned by a “political consultant,” 2) The content of communications intercepted over the target phone and Ament’s cellular telephone and 3) An FBI confidential witness the agent identified as “CW1”.

CW1 was later identified as Melahat Rafiei, a high ranking official in the Democratic Party and influential political consultant who owns a cannabis-consulting firm – WeCann – and Progressive Solutions Consulting (PSC), a powerful political campaign organization deeply embedded in Long Beach politics.

The FBI had been investigating Rafiei since 2018 for “theft or bribery concerning programs receiving federal funds, among others.”

Between June 24 and July 23, 2019 the agent legally tapped Rafiei’s phone and then arrested her on Oct. 28, for violating 18 U.S.C. Section 666 (theft or bribery concerning programs receiving federal funds).

The agent wrote that, “CW1 (Rafiei) was interviewed on the same day as CW1’s arrest and CW1 subsequently agreed to cooperate with the FBI in this investigation.”

The complaint was then “dismissed without prejudice at the request of the government,” meaning criminal charges could be re-filed if the now “cooperating witness stopped cooperating.”

The agent then informed the court in his affidavit that he believed “CW1 “lacked candor” during the investigation and omitted material facts “throughout CW1’s cooperation with the FBI, including additional instances where CW1 has offered to pay bribes to elected public officials.”

In spite of CW1’s lack of candor the agent wrote that there were instances where her information was “deemed credible by way of corroboration.”

The agent established in his CW 1 footnote that “the government (and CW1’s attorneys) have not been able to reach an agreement on a pre-indictment resolution, and at this time, there is no further cooperation expected.”

The agent concluded: “I believe CW1’s motive for cooperating in this investigation was to receive leniency for the federal criminal violation CW1 was originally arrested for, as well as other possible criminal conduct. He wrote, “The government has not made any promises of leniency to CW1 or CW1’s counsel.

The affidavit went on to spell out corruption in the cities of Anaheim and Irvine and in one respect or another “CW1” was on the fringes of all of it.

The Orange County Register broke the story of wide spread corruption, the Voice of OC broke an even better story and as the days passed Anaheim Mayor Harry Sidhu resigned proclaiming that his corrupt intent surrounding negotiations related to selling Anaheim Stadium – one that resonates with the deal made by Long Beach City Hall to turn Community Hospital over to Molina Wu – was merely part of his “unwavering goal from the start to keep the Angels in Anaheim, so that this vibrant social and economic relationship will continue.”

Norberto Santana Jr. – Voice of OC publisher – described the FBI affidavit as reading like something out of the final act of the film Casino, where the FBI swoops in.

Santana Jr. wrote: “Anytime Anaheim taxpayers had an advantage in negotiations with the LA Angels, Sidhu and his City Council majority blunted it.”

He said, The “FBI learned that the City of Anaheim was tightly controlled by a small cadre of individuals…” and that “these insiders – who have long-standing ties in Anaheim all worked to get Sidhu appointed to the city’s negotiating team by lobbying City Council members…”

Rafiei and PSC in Long Beach

In Long Beach the Irvine/Anaheim story spread – phones rang, stories were written in the local press and politicians began to scramble – all because the collusion in Orange County politics resonated with the big money issues in Long Beach. This includes the $30 million Water Department rebate lawsuit, the Urban Commons corruption, the Queen Mary debacle and the backroom engineered contract that excluded the city auditor from auditing the millions in hospital expenses that would serve as leverage for Molina Wu to grab ownership of Community Hospital and its surrounding property and mineral rights – until the state stepped in.

Perhaps the best story written – one that quickly connected the dots of Melahat Rafiei’s career launch and deep political ties to Long Beach – came from Joe Mello on May 23 in his neighborhood blog LB4D. The story was entitled Long Beach’s Political Connections to the FBI Corruption Probe in Anaheim/Irvine.

Mello wrote that Rafiei – who has now resigned from her high perch as secretary of the state’s Democratic Party – had developed a “very legal pay-for-power scheme that essentially made the political consultant and her company, PSC, “a major part of the Long Beach political machine.” It was, until last week, “deeply involved in the 2022 Long Beach election including as campaign manager for the Long Beach Machine candidate Megan Kerr in the 5^th District” as well as providing management services for “Machine candidates’ first runs for office like Long Beach Political Machine operative Herlinda Chico.”

Mello dug deeper, writing: “In 2016, Long Beach Democratic political operative Cory Allen (Herlinda Chico's roommate) became then Long Beach 1^st District Councilperson Lena Gonzalez's chief of staff. In 2019 Allen left that position to join PSC.

“In September 2021, Irvine Mayor Khan hired Cory Allen as a council executive assistant despite his role as her campaign manager while he continued to work for Melahat Rafiei.

“Allen quickly became the center of an ethical controversy in Irvine when he was hired to work in Khan's office while also acting as her PSC campaign manager.

“After winning the mayor's position in May of 2021, a slim majority of the Irvine City Council that includes Khan voted to increase the personal officeholder accounts of the City Council under the guise of increasing pay for the city councilpersons staff called council executive assistants.”

Mello wrote: “The move was similar to what the Long Beach City Council did in 2017 after the Long Beach Political Machine won a clear majority in the 2016 election.”

Mello saw that WeCan, Rafiei’s cannabis consulting firm, when combined with her PSC business, “blurred the lines between political campaigns, politicians, the cash-rich cannabis industry and PSC’s own employees.”

A Crossover Worth Investigating

That “blur” carried over to Long Beach in at least one instance that is worthy of deeper investigation.

The FBI affidavit established that Dan Zaharoni, CEO of From the Earth, a cannabis shop in Santa Ana – represented by Rafiei’s WeCan – had been defrauded by the Anaheim players.

A Beachcomber insider said that Zaharoni is not a pure victim and that it’s “possible that a fraudster can himself be defrauded,” when pointing to the Queen Mary/Urban Commons scandal.

Zaharoni was the primary contact person for Urban Commons to the city during the construction work performed on the Queen Mary, which was financed by $23 million in municipal bonds.

In a city auditor's review conducted by hired accountants Zaharoni was exposed as having conflicts of interest with the subcontractors he hired. The little-known audit report revealed:

"It was determined that Dan Zaharoni, for example, Urban Commons’ chief development officer, had relationships with at least two subcontractors: Maxon Technologies and Cal Building & Maintenance.”

The report said: “Based on information available, it appears that Maxon Technologies received approximately $220,000 for repair projects and Cal Building & Maintenance received approximately $65,000 for repair projects. Due to the inappropriate relationships found it is possible that they (Zaharoni’s siblings), were not the most qualified subcontractors and charged inappropriate amounts."

Zaharoni is also the Urban Commons executive that hired then Councilwoman Jeannine Pearce in a conflict of interest scam that paid the councilwoman $30,000 in “consulting fees,” that were not disclosed as required by law.

A political patina had been put on all of it at a prior event when “2nd District Councilwoman Jeannine Pearce; Mayor Robert Garcia and Urban Commons chief development officer, Dan Zaharoni, hosted a special celebration aboard the majestic Queen Mary to present $10,000 in contributions to the Mayor’s Fund of Education and The WomenShelter of Long Beach.”

Public documents also establish that between November and December 2016 Dan Zaharoni and Urban Commons LLC made monetary contributions to Pearce’s officer-holder fund and City Council candidacy totaling $5,300.

When all of it was exposed City Attorney Charles Parkin hired Best, Best and Krieger (BBK) to investigate and in the end Parkin issued the councilwoman an ethics warning to Pearce for failure to recuse in the appropriate manner.

How Deep is Rafiei’s Influence?

The chart found at this link lists 31 current, past and hopeful candidates for office in the City of Long Beach who have received monetary contributions from and made payments to PSC’s Melahat Rafiei or known Rafiei associates.

The totals for all 31 include:

Monetary Contributions Received: $9,325

Payments Made: $418,040

Accrued Expenses (unpaid bills): $37,264

Of the 31 individuals listed, seven are currently running for office in the current election. They Include:

• Suzie Price, candidate for mayor has made payments of $113,993 with $18,306 still outstanding.
•  Rex Richardson, candidate for mayor paid $7,569 in prior election cycles.
•  Doug Haubert, incumbent candidate for city prosecutor paid $27,185 with $6,028 still outstanding.
• Mary Zandejas, incumbent candidate for CD-1 paid $58,005 with $2,500 still outstanding.
• Megan Kerr, candidate for CD-5 paid $7,334 with $1,454 still outstanding.
• Roberto Uranga, incumbent candidate for CD-7 paid $57,149 in prior election cycles.
• Joni Ricks – Oddie, candidate for CD-9 paid $9,217 with $2,487 still outstanding.

The Beachcomber sent each of the candidates a list of questions related to their association with Rafiei and PSC.

Three of the seven responded.

Q & A

Beachcomber Question: It would be appreciated if you would provide comment as to the specific deliverables that your office received for the dollars spent.

Richardson: Answer not responsive to the question.

Uranga: “Progressive Solutions Consulting is one of the consulting firms that we worked with during campaigns. Members of its team mostly worked on event coordination, clerical support and follow up.”

Oddie-Ricks: Did not respond to the question.

Beachcomber Question: Have you ever been asked by Rafiei to influence council decisions in exchange for monetary contributions or other contributions and support, as the FBI alleged in her arrest in 2019 for bribery of Irvine council members?

Richardson: No.

Uranga: No, never.

Oddie-Ricks: Was not asked the question.

Beachcomber Question: Have you ever attended a “retreat” organized by Rafiei? If yes, what was the agenda?

Richardson: No.

Uranga: No.

Oddie-Ricks: Did not answer the question.

Beachcomber Question: Do you believe that Rafiei is considered a “ring leader” and a part of a small group that has significant influence over the business and governmental affairs in Long Beach – as the FBI alleges she wields in the city of Anaheim and Irvine?

Richardson: Answer not responsive to the question.

Uranga: Absolutely not. I did not ever meet with her regarding Long Beach issues.

Oddie-Ricks: Did not answer the question.

Beachcomber Question: What is your current relationship with Rafiei and her company?

Richardson: I have not worked with Melahat Rafiei’s firm – PSC – in three years, since July 2019, nor was I aware of any of her alleged illegal activity in Orange County. She was no longer aligned with our goals and I felt it was time to move on.

Uranga: My campaign parted ways with PSC earlier this year. I was not aware of Rafiei’s prior arrest or this ongoing investigation until the recent information was made public.

Oddie-Ricks: “Upon hearing of the allegations surrounding Rafiei I made the decision to cancel my campaign consulting contract last week. My campaign is no longer a client of PSC.”

Suzie Price, Doug Haubert, Mary Zandejas and Megan Kerr did not respond to the Beachcomber questions.

Schipske Petitions Parkin to Investigate

On May 24, Gerrie Schipske, candidate for city attorney issued a press release in which she called upon the city attorney to “immediately begin an investigation into the connection between Long Beach elected officials and the political firm of PSC, whose owner has been named in the ongoing FBI criminal investigation concerning bribery of elected officials and fraud.”

Stephen Downing is a Long Beach resident and a retired LAPD deputy chief of police. stephen.beachcomber@gmail.com