What a day for political ethics in California

lrosenhall@sacbee.comNovember 16, 2013 

LEZLIE STERLING — lsterling@sacbee.com

Even for a political town where claims of wrongdoing are woven into the competitive fabric, Sacramento has seen an unusual burst of activity alleging ethical breaches by the powerful.

On a single day this week, the Democratic leader of the state Senate stood before the Capitol to address the latest allegations in an FBI corruption probe, a Republican state senator took the witness stand to testify he had not engaged in money laundering, the state’s political watchdog handed down fines to two past lawmakers who admitted campaign finance violations, and three former government officials who were recently fined for not registering as lobbyists sat through a required ethics class.

The instructor went over rules that forbid lobbyists from giving officials gifts worth more than $10 a month, explained exceptions – such as those that allow lobbyists to entertain officials at their homes or invite them to a wedding – and advised the 74 lobbyists in the audience not to deliver campaign checks to politicians’ offices.

“This is the part where I used to talk about what was known as ‘shrimp scam’ in the late ’80s and early ’90s, which was an FBI sting,” said instructor Cary Rudman, chief counsel to the Senate Committee on Legislative Ethics.

He explained that the case involved undercover agents posing as the operators of a shrimping business, who offered bribes in exchange for beneficial legislation. The case eventually led to the convictions of several lawmakers, staff members and lobbyists, Rudman said.

The history lesson may no longer be necessary.

“As most of you know, there has been some recent activity,” Rudman told the class. “Allegations of corruption are here.”

The high-profile FBI investigation of state Sen. Ron Calderon has roiled the Capitol since agents raided his offices in June. The case has taken dramatic turns in recent weeks as Al Jazeera America published a 124-page affidavit in which the FBI alleges Calderon accepted $88,000 in bribes from an undercover agent and a Long Beach hospital executive.

Calderon, a Democrat from Montebello, responded this week with a federal court filing alleging the government intentionally leaked the affidavit, and that two other Democratic senators – Darrell Steinberg of Sacramento and Kevin de León of Los Angeles – were in fact the focus of the FBI’s probe.

No charges have been filed. Steinberg and De León have each said prosecutors told them they are not the subject of the federal investigation. Calderon’s attorney has said his client has not done anything illegal.

Still, the investigation has affected attitudes at the Capitol.

“It makes everybody much more cognizant of their conduct,” former Senate leader Don Perata said as he came out of the lobbyist ethics class on Thursday. “I think people probably begin to second-guess a lot of stuff that they shouldn’t have to.”

Perata was in the class because he registered as a lobbyist earlier this year, and the two-hour ethics training is required as part of registration. But he has a unique view of the Calderon investigation: As president pro tem of the state Senate from 2004 to 2009, Perata was the focus of a five-year FBI investigation that never resulted in any charges.

“The difference is that in my own experience there were no allegations made and I was exonerated at the end. But it’s not something you want to put anybody else through,” Perata said.

The latest FBI investigation comes as the state’s Fair Political Practices Commission has beefed up its prosecution of politicians, lobbyists and campaign donors who violate California’s political ethics law.

On Thursday, the commission fined former state Sen. Dean Florez, D-Shafter, $60,000 for misusing campaign funds; fined former Assemblyman Mike Roos, D-Los Angeles, $3,000 for breaking state law by making political contributions while he was a registered lobbyist; and finalized a settlement with current Assemblyman Luis Alejo, D-Watsonville, in which he was required to return $21,000 to an independent group that had illegally coordinated with his campaign.

The same day, in a hearing room in Natomas, an FPPC attorney questioned state Sen. Tom Berryhill, R-Twain Harte. The commission asserts that he illegally laundered tens of thousands of dollars in campaign cash in 2008 to help the Assembly campaign of his brother, Bill Berryhill. The Berryhill brothers deny doing anything wrong, so their case is going through a public hearing rather than the closed settlement talks more typical of FPPC cases.

Last month, the FPPC made national news in levying a record $1 million fine against two nonprofits that funneled money to California ballot measures without properly reporting the contributions.

And in September, the commission fined three partners of California Strategies – a high-profile public-affairs firm in Sacramento – for lobbying state government without registering as lobbyists. The fines were significant because so-called “shadow lobbying” by former state officials is difficult to catch.

The California Strategies partners who were fined – former Assemblyman Rusty Areias, former Environmental Protection Agency Secretary Winston Hickox and former gubernatorial speechwriter Jason Kinney – sat through the lobbyist ethics class with Perata on Thursday. Kinney served on Perata’s staff in the Senate and now advises Steinberg on political communications.

The burst of activity exposing ethical breaches isn’t a sign that the political process is more riddled with wrongdoing than usual, said Gary Winuk, the FPPC’s chief of enforcement. Instead, he said, it’s a result of the FPPC’s effort to focus on big offenses and do a better job collaborating with local, state and federal law enforcement agencies.

“We started our efforts to be more aggressive at the FPPC 41/2 years ago, and a lot of it is just coming to fruition right now,” Winuk said.

Barry Broad, a veteran labor lobbyist, said lobbyists around town have noticed that the agency charged with policing political ethics is getting tougher.

“I don’t think the process has gotten worse. I think the prosecutorial will has gotten greater,” Broad said.

He cited his own example of being fined $2,500 this year by the FPPC for filing a quarterly report four and a half months late.

“They’re being tougher. They’re investigating more. They’re looking at stuff, and I don’t think there’s anything wrong with that.”

Phillip Ung, a lobbyist for California Common Cause, a group that promotes government transparency, said what the Capitol is experiencing is “an exciting time for ethics.”

He said his group has been trying for years to raise attention about former politicians lobbying without registering their activity, about politicians using campaign accounts as “personal slush funds,” and about the potential for political donors to hide their identities.

“These recent actions show that our theories in regard to the corruption of money in politics are not conspiracy theories,” Ung said.

Editor's Note: This story has been updated to remove a reference that Assemblyman Luis Alejo was fined. His committee was required to repay $21,092 the FPPC determined was illegally donated to his campaign by his campaign consultant. Updated at 2 p.m. Nov. 18, 2013.

Call Laurel Rosenhall, Bee Capitol Bureau, (916) 321-1083. Follow her on Twitter @LaurelRosenhall.

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