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Hand Jobs and Handouts

LAST WEEK, THREE YEARS AFTER he launched his “pay to play” investigation of former Mayor James Hahn, District Attorney Steve Cooley finally answered the question that had been nagging the public for so long: How big a tip should you give for a hand job at the Bonaventure Hotel?

Former Deputy Mayor Troy Edwards, the man picked by Hahn to supervise the city’s harbor, airports and Department of Water and Power, provided no more than $20. But Leland Wong, the one-time city commissioner accused of bankrolling the deputy mayor’s hand jobs, tipped $30, $50, even $60 — even as his lawyers denied that he arranged for the massages to include happy endings. So clearly, the important message for the public is to add all those figures together, divide by four, and pay the average.

But wait. That wasn’t the question voters had in mind, was it? No, there were many important issues swirling around the pay-to-play probe, which originally centered on campaign contributions and contracting and played a major role in toppling Hahn, the man who appointed Wong to two city commissions. But those issues were drowned out by the more, shall we say, graspable revelations of Handjobgate.

Wong’s attorneys got things rolling by excerpting and underlining every passage of the 1,250-word grand jury transcript featuring Edwards and the word “masturbation.” While insisting that they wanted the excerpts sealed, Wong’s lawyers masterfully turned the spotlight toward Edwards, making him look like a low-grade perv, and one who got immunity, to boot. Political reporters across Los Angeles then had to ask the really tough questions, such as: Is masturbate a transitive verb? (The Los Angeles Times decided yes, saying Edwards testified that the masseuses “sometimes masturbated him.”)

Yet nowhere in the grand jury transcript did prosecutors answer the more stomach-churning question: How did this guy, San Marino resident Leland Wong, wield so much power? Wong, after all, is the only member of the Hahn administration to be charged under the pay-to-play scandal. He faces 20 felony counts, including one for bribery, one for conflict of interest, three for tax fraud and 13 for embezzlement — funneling money from his employer, Kaiser Permanente, into Lakers tickets and, yes, those massages at the Bonaventure.

Edwards was instantly compromised by the free spa visits, linking himself in secret with the man who would bring him down. But when it comes to violating the public trust, Wong jerked off Edwards, port officials and the public in much more damning ways, according to the nine volumes of grand jury testimony and exhibits. The most alarming tale told by the transcript is the one that portrays Wong as a relentless hustler — not a pimp at the Bonaventure Hotel, but a citizen volunteer who deftly wove himself into the fabric of the Hahn administration, dictating decisions at an agency where he had no authority, and enriching himself in the process.

Wong tried to bully an inexperienced and unsupervised deputy mayor into awarding a lucrative port lease to Taiwan-based Evergreen Marine Corp., the company paying Wong $5,000 each month. He browbeat officials at Los Angeles International Airport to let him keep his official airport badge, even after he had been reassigned from the airport commission. (“Leland is on me like white on rice,” one befuddled LAX staffer pleaded in an e-mail to Edwards.) And most disturbingly, Wong repeatedly applied pressure to top port officials, who feared that he would return to the harbor commission and punish them if they disobeyed.

With Hahn asleep at the wheel, Wong worked to undermine the expertise provided by the port’s financial analysts, its top negotiator, its executive director and even the mayor’s appointees at the harbor commission. He did all this even as he reported to the Ethics Commission that he was getting paid by Evergreen — reports that no one in the Hahn administration bothered to check. Wong wasn’t even a paid Hahn employee.

You see, in Los Angeles, the most important members of a mayoral administration are frequently its volunteers — the 300 or so citizens who serve on the boards and commissions that oversee 42 city departments. Wong’s day job was at Kaiser Permanente, where he worked in government relations, doling out money for community groups and civic projects and enhancing his status as a power broker. But his time on city commissions increased his influence much more, as he served first under Mayor Tom Bradley, then Mayor Richard Riordan and finally Hahn. Wong, like other City Hall power brokers, bumped along from commission to commission, moving from the harbor to the airport, from the airport to the DWP, increasing his stature and his sense of permanence in the City Hall firmament. Wong was Riordan’s president of the harbor commission when Evergreen’s first major lease was approved. And he was Hahn’s appointee to the airport commission when he received his first $5,000 payment from Evergreen, a bill submitted before Hahn had even finished his first year in office.

Wong was overseeing Los Angeles World Airports in 2002, when the agency was trying to entice the cargo airline known as EVA Air to move to Ontario International Airport. But Wong was also working to provide EVA’s sister company and maritime counterpart, Evergreen Marine Corp., more acreage and a much more lucrative lease at the Port of Los Angeles. With Wong at the helm, the two deals became linked: If EVA agreed to fly out of Ontario, something it didn’t really want to do, the port would reward its sister company with a sweet deal at the harbor. Wong’s work at the airport would therefore benefit his bosses in Taiwan.

To truly understand how aggressively Wong pushed for those two deals, it’s best to consider the tribulations of another former city employee — the man who was once the gatekeeper for new leases at the Port of Los Angeles, Albert Fierstine.

FOUR YEARS AGO, Fierstine was helping the five volunteer members of the harbor commission to navigate a tricky, highly competitive process: deciding which shipping company should receive the right to lease 86 acres. The commission wanted the company with the strongest environmental proposal. After months of site visits, Fierstine and two other city officials signed a letter of intent in mid-2002 with P&O Nedlloyd, a London-based shipping firm that had agreed to power its ships with electricity, not diesel fuel, while at berth.

By June 2002, Wong had learned of the plan to give the lease to P&O, not Evergreen. So he scheduled a lunch with Fierstine. Fierstine met Wong at the Biltmore Hotel and explained to him that Evergreen would not get the 86 acres. Sitting inside the hotel’s Japanese restaurant, Wong had a one-sentence response: “That’s not what I want.”

“I said to Leland, ‘Don’t get involved in this, because you’re gonna screw this up,’?” Fierstine later recalled to the grand jury.

Within months, Fierstine saw his work on the 86-acre lease yanked out of his hands and turned over to his boss, port executive director Larry Keller. Keller, for his part, had his own awkward visit with Wong. In his own testimony, Keller described how he was asked by Edwards to have dinner with Evergreen’s executives at the Bonaventure and — surprise! — there was Wong, attempting to oversee the negotiations.

“And I said, ‘Well, Leland, what are you doing here?’ And he said, ‘Well, I’m representing the airport’s interest in this thing, but I’m here to represent the city as a whole.’?”

Keller told the grand jury that he became upset, since he had not been briefed on Evergreen’s intentions and wanted nothing to do with airport leases, which, under state law, cannot be mixed with harbor funds. Edwards asked Keller to cool down, according to the testimony, then took Wong and the Evergreen executives to another part of the Bonaventure, forcing Keller to wait by himself for 90 minutes.

Wong surprised Keller again four months later, during Hahn’s much-promoted November 2002 trade mission to Asia. Edwards invited Keller for breakfast to discuss efforts to link EVA with the Evergreen port lease, and Wong showed up again. Wong intensified the pressure, saying he was unhappy that the port’s negotiators hadn’t made more progress in “assisting Evergreen with some of their concerns.”

“I finally said, ‘Look, Leland, I don’t know what you have got to do with this anyway. I don’t know why we’re having this conversation. I have done what I was asked to do. The team is in Taipei.’ And he was increasingly upset with me,” Keller testified. Edwards then tried to reassure Keller about Wong. “He’s just here to help.”

But by then, Edwards was under his own set of pressures. Hahn’s press machine had been trying to roll out a series of policy victories for the reporters who had joined them on the Asia trade junket. One involved EVA’s promise to move its freight business to Ontario. But Evergreen wouldn’t sign off on the EVA agreement without a commitment to more space at the port and a break on its rent that was estimated to reach as much as $11 million per year. If EVA signed off on the deal, Hahn could finally provide evidence to neighborhoods near Los Angeles International Airport that he was making progress in relieving the air-traffic burden on LAX.

While he was staying at the Imperial Hotel in Tokyo, Edwards received a handwritten fax from Wong, telling him, “You have to provide some direction to Larry Keller. The city/port has been disrespectful and have not handled this matter well,” Wong wrote, adding, “Focus on this matter, please and let’s get it done.”

Edwards responded by ordering Keller and one of Hahn’s harbor commissioners, James Acevedo, to fly to Taipei to give Evergreen what they wanted. “[Edwards’] words were something like, ‘We don’t want to embarrass the mayor when he arrives in Taipei,’?” Acevedo later told the grand jury.

Keller and Acevedo signed a memorandum of understanding with Evergreen, promising more land and better lease terms. But unlike the other Asian trade initiatives, they kept mum about the port pact. Even as Hahn held a photo op with Evergreen regarding its clean-air initiatives, no mention was made of the lease agreement.

But by then, nearly all of the mayor’s 2002 Asian trade initiatives were becoming tainted. Hahn had sought an agreement to bring pandas to the Los Angeles Zoo, only to settle for golden monkeys. But because cages for those monkeys cost $6 million, Edwards had tried to get Evergreen to pay for the cages. Port officials later rejected that idea as a violation of state law.

Hahn also tried to convince Asian shippers to participate in AMP, one of his administration’s signature environmental initiatives, which asked for ships to rely on electricity instead of diesel fuel. Wong tried to exploit that initiative as well, by pressing the Department of Water and Power to pay a disproportionate share of Evergreen’s plug-in equipment, according to prosecutors.

By the start of 2003, Wong’s power was at its peak. As a planner of Hahn’s Asia trip, he had managed to keep Fierstine — his biggest obstacle on Evergreen — at home in Los Angeles. He had a deputy mayor with little knowledge of the harbor or airport turning to him regularly for advice. And he terrified port staffers, who feared that he could return to the harbor commission and punish them for contradicting his wishes.

Wong repeatedly told port staffers, “I may be back,” explained Fierstine, in his first public statements since his grand jury testimony. The words were delivered as a joke, but everyone took them seriously, Fierstine said.

“There was a lot of speculation that he was coming back to the harbor, and everybody was afraid of that, because of the way he does business and does tactics,” he said. “I mean, you don’t get promoted if he doesn’t like you, even if you’re qualified.”

WEEKS AFTER HAHN AND HIS ENTOURAGE returned from Asia, environmental activist Noel Park went to his mailbox in early 2003 and found a surprise: a slender envelope sent anonymously with no return address. Inside was the Evergreen lease proposal signed by Keller and Acevedo only a few weeks earlier.

For Park, who had long criticized the port for failing to control its diesel emissions, the document was highly unusual. For one thing, the San Pedro resident had received assurances from Hahn’s harbor commissioners that they would stop approving port expansion projects without consulting a community panel convened by the mayor. For another, the pact had been reached during Hahn’s much ballyhooed trade mission to Asia — one where the mayor announced everything from AMP to the golden monkeys — yet somehow it had never been discussed publicly.

Furious that the port had paved the way for another terminal project without community involvement, Park went to the harbor commission to chew out harbor commission president Nick Tonsich. Tonsich responded by saying he had never seen the agreement mentioned by Park. Because by then, the Hahn administration, his harbor commissioners and port executives had divided into two camps: one seeking to give space to Evergreen, and the other favoring Evergreen’s competitor, P&O Nedlloyd.

The secret delivery of the Evergreen agreement was one of the several ways in which Wong’s world was starting to unravel. Fierstine told auditors for City Controller Laura Chick of the pressure Wong was exerting on behalf of Evergreen. Although the issue received scant mention in Chick’s audit, Fierstine’s whistleblowing showed up in the audit’s backup notes, and were detected by reporters. Meanwhile, Wong’s bosses at Kaiser were starting to wonder why the executive was spending so much company money — funds that were supposed to help underprivileged families — on massages and Lakers tickets for well-connected figures like Miguel Contreras, who headed the powerful Los Angeles County Federation of Labor until his death in 2005.

Kaiser employee Debbie Hernandez, a secretary who worked for Wong, told prosecutors that she directly confronted her boss about the massages for Contreras, only to be told, “This was how business gets done.” Wong then explained that Contreras was a key player in Kaiser’s labor-management partnership. “What he said to me was, ‘Whatever Miguel wants, Miguel gets,’?” Hernandez told the grand jury.

WHILE KAISER LOOKED INTO Wong’s spending habits, the divide in the Hahn administration continued to widen, with the Evergreen camp — Edwards and Keller — feuding with the P&O camp, composed of Fierstine and Tonsich, the commission president. Dismayed that Tonsich and his colleagues still planned to award a lease to Evergreen’s competitor, Edwards showed up at a meeting of the commission in November 2003 to set them straight. Fierstine told Edwards that Wong was improperly interfering. Edwards then demanded that Fierstine — the port’s lead negotiator — leave the closed-door meeting.

“He tried to kick me out, and Nick [Tonsich] spoke up and said, ‘No, he’s right. Leland is the problem,’?” Fierstine recalled this week. “Troy was furious. He said, ‘I want you out of the room.’?”

Edwards also berated Hahn’s volunteer harbor commissioners, prompting one of them to strike back. Commissioner Tom Warren, a crusty bigwig in the International Longshore and Warehouse Union, publicly asked for a legal opinion to determine whether they had the legal authority to defy Edwards’ directive — dramatically pushing the dispute out into the open. That grabbed the attention of Hahn chief of staff Tim McOsker, who showed up a month later to mediate the dispute, offering to satisfy both sides by restarting the competition for the lease.

By the time McOsker met with the commission, Kaiser had placed Wong on paid leave. McOsker learned weeks later that Wong had been fired for misappropriating funds, and he told Wong to resign from the DWP commission as well. But by then, prosecutors had begun issuing subpoenas for e-mails, city contracts and other documents dating back to the Riordan era. Prosecutors demanded that Edwards testify about contracting at the airport. Edwards resigned in April 2004, the same month that investigators raided Wong’s home in San Marino.

Only when Wong and Edwards were gone from the Hahn administration did Fierstine feel the freedom to terminate the contract of the port’s overseas marketing agent in Hong Kong. Fierstine concluded that the firm’s principal, William Wong, had little expertise and was traveling to Shanghai repeatedly to meet Leland Wong (no relation) without the port’s permission.

Even when Wong was at the DWP, Fierstine feared retribution if he severed the contract with the firm, which had ties to Leland Wong dating back 20 years. That, at its essence, demonstrated the corrosive power Wong had over many of the port’s civil servants. “I’m not stupid. There’s certain things you can do, and certain things you can’t do,” Fierstine recalled.

Not that Wong’s departure provided much relief. Fierstine — who had spent several weeks on stress leave — was reassigned to a job he never asked for: marketing of the port’s waterfront promenade, a recreational project that he hated. Fierstine quit instead.

If any reassurance can be provided from the Wong affair, it is that his efforts on behalf of Evergreen were so often blocked. Keller wrote a lease agreement in Asia with Evergreen that was not binding, assuring that the harbor commission could reject it later on. Hahn’s harbor commissioners repeatedly rebuffed requests for financial assistance to Evergreen, while the DWP rejected another break suggested for the shipping line.

In an unseen way, the system worked. But by the time it did, Wong and Edwards had already undermined the Hahn administration from within, paving the way for its demise.

One of the ironies of the D.A.’s case is that another former airport commissioner helped bring Wong down. One-time Riordan appointee Dan Garcia, now Kaiser’s ethics compliance officer, told prosecutors that his company discovered that Wong was spending company money on political fund-raisers — and went so far as to have his own staffers call potential contributors.

With Kaiser preparing to oust him, Wong asked Garcia for help with a severance package. Garcia told Wong that he’d have a better shot if he explained who benefited from Kaiser’s largess, from at least $18,000 worth of massages to roughly $250,000 in game tickets.

“And I asked him,” Garcia told the grand jury, “as directly as one human being can ask another: ‘Who were they?’ And that you have to disclose them. And he said, ‘Well, I can’t tell you that,’ and ‘You don’t want to know’ — or words to that effect. And he said, ‘You know who they’re really for,’ which I took to mean that he had given all or some of them to public officials.”

If Wong reaches a deal with the prosecution, he could finally answer questions at the heart of pay to play — the fund-raising practices that triggered the investigation in the first place. For now, that doesn’t look too likely. In a statement, Wong’s attorneys said prosecutors asked slanted questions, and built a case based on multiple promises of immunity. They predicted that Wong will be cleared by a jury.


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