Will the FBI Corruption Probe of Ron Calderon End up Exposing His L.A. Pals?
ILLUSTRATION BY FRED HARPER
Last summer, two men sat at Dal Rae, a swank throwback to 1950s dining elegance in Pico Rivera, having a high-level movie-biz meeting far from Hollywood gossips, except that one of them was surreptitiously taping the entire thing.
The conversation turned from films to politics — specifically, to the tax credit California offers a lucky few independent filmmakers whose budgets exceed $1 million.
"There might be a play, you know, to lower, to lower the tax credit [qualification threshold], uh, for movies," the corpulent, graying man told the slick, trim one.
California state Senator Ronald Calderon, 56, suggested such a play was within his power, perhaps not to lower the threshold to $500,000, as his companion hoped, but at least get it down to $750,000.
Calderon, after all, had been elevated to the California Film Commission and named chair of the Senate's select committee on film and TV by powerful Senate president pro tem Darrell Steinberg. The former real estate agent and mortgage banker was a fulcrum of power in the state's film industry. In 2009, Calderon carried the bill that created the tax credit intended to slow "runaway production."
The Montebello Democrat also is a member of one of Southern California's most powerful political families. The Calderons rule in the working-class neighborhoods of Southeast L.A., a dominion that includes scandal-plagued Bell. Ronald and his older brothers, Charles and Thomas, have been heavyweights in state government for years, flaunting their taste for expensive cigars, decadent meals and luxury outings at golf resorts — paid for with political contributions.
At Dal Rae, the senator explained the complications he faced in lowering the tax-credit threshold: "It's a matter of where. .... What negotiating position I put myself in. ... Certain industries might push back."
Rocky Patel wanted to tweak the threshold — a potential investor in Florida insisted on seeing such legislation advance before joining his film venture.
"It's all about creating jobs, keeping the movie industry here in California, right?" Calderon asked.
But Patel wasn't an owner of United Pacific Studios, as he claimed, or even in the movie business. In June his actual colleagues — FBI agents — raided Ron Calderon's Sacramento office.
Speculation raced through the Statehouse. Then, on Oct. 30, Al Jazeera America published a heavily blacked-out, 124-page affidavit that documented the FBI's multiyear investigations into corruption in the cash contribution–driven, expense account–oiled state Capitol.
The leaked document, filed under seal in support of the FBI's search warrant, detailed the chat between the two men at the Pico Rivera restaurant, and the evolving relationship that led to serious horse-trading: Calderon and Patel ultimately swapped cash, jobs (Patel's girlfriend, an FBI agent posing as a struggling model, was hired as a state Senate staffer), legislative favors and top-drawer entertainment. At one point, Calderon emailed Patel pictures of himself taken with rappers Nelly and T.I. at a Las Vegas nightclub — after Patel paid $4,000 for the senator's VIP table there.
In all, Calderon received about $60,000 from Patel, almost half in the form of his $3,000 monthly payments to Calderon's daughter Jessica — for a job at Patel's film studio that involved no duties. Calderon repeatedly asked Patel to give his daughter something to do, but Patel offered her no work and the Calderons maintained the arrangement. Calderon took another $28,000 from Michael Drobot, owner of Pacific Hospital of Long Beach, according to the affidavit.
The Calderon investigation began in 2007 when the Fair Political Practices Commission tipped off federal authorities about a $1 million payment from Drobot to Ron's brother Tom Calderon, made after Tom left his seat in the California Assembly. "It was suspected that this exceptionally large and unusual payment might evidence that THOMAS CALDERON was using his brothers' political influence to favor DROBOT in return for monetary compensation, that is, a bribe," the affidavit reads.
Ron Calderon has been sucked into a media and political firestorm. It's consuming his political clan, tarnishing his allies in L.A. — including city councilmen José Huizar and Gil Cedillo — and has mired Calderon's former cheerleader, Steinberg, in a PR nightmare.
According to the leaked transcript, on Nov. 2, 2012, Calderon described several bank accounts into which Patel could transfer him cash — including one belonging to a "Los Angeles City Councilman." Media are striving to identify that councilman.
That brief exchange extended the scandal's tentacles to Los Angeles City Hall and "cast a shadow over the whole body," City Councilman Bernard Parks, L.A.'s former chief of police, says. "It's validating the suspicions of people who believe that this is going on the whole time."
In a recent phenomenon dubbed "Sacramento South," termed-out legislators have flooded L.A. to run for City Council. Today, seven of 15 councilmembers are former legislators. All were Ron Calderon's colleagues.
"You have the perception that you have a mini Sacramento," Parks tells the Weekly.
Most L.A. residents had never even heard of Calderon when media outlets published photos of him — scowling, caricature-like images of a man whom some described as a "political fat cat." Yet, according to L.A. City Ethics Commission records, Calderon is deeply involved in L.A. politics.
City Councilmen Huizar, Cedillo, Paul Koretz and Curren Price have all taken money from political funds linked to Calderon and members of his family. Cedillo's son once was Calderon's chief of staff.
The most-discussed link to City Hall arose after reporters discovered that the undercover FBI agent's exploits, as described in the affidavit, matched those chronicled on the Twitter account @rocky2hollywood. The account's owner, Rocky Patel, used as his front United Pacific Studios, an operating, independent film studio in downtown L.A.
After his cover was blown by Al Jazeera America's big scoop, Patel's Twitter account was closed and most of his messages vanished from the Internet.
The last two entries, preserved in an online archive of 20 of his tweets, show how Patel used Twitter to gain visibility with, and stroke the egos of, politicians allied with Calderon: One is a retweet of an innocuous message sent out by Councilman Huizar about celebrating Earth Day "w Gas Co and DWP," and the other is a retweet of a message in which Assemblyman Ian Calderon touts how "my first policy bill" passed on the floor of the Assembly. Ian Calderon is Ron's 28-year-old nephew, a former surfing champ elected to the Legislature last year from Southeast L.A. after the Calderon family tapped its political friends to pour money into his campaign.
The Los Angeles Times reported that 18 of Patel's @rocky2hollywood tweets had some connection to Huizar — and that Patel contacted Huizar's office about a permitting issue.
Swirling talk of Calderon's City Hall dealings is impeding the City Council's ability to do its work, Parks says, adding, "When people speculate, it's even worse."
Huizar and Cedillo did not return several phone calls from L.A. Weekly.
Calderon has not been charged with a crime. On Nov. 14, his attorney, Mark Geragos, filed a contempt motion, accusing the FBI of leaking its own sealed affidavit.
Geragos claims the FBI blew its elaborate operation in order to punish Calderon for not wearing a wire to tape Steinberg and Sen. Kevin de León. The FBI and U.S. Attorney "engaged in a campaign to smear the reputation of Sen. Calderon and convict him in the press and public," Geragos wrote.
L.A. politicians have largely avoided comment on the Calderon scandal, but reform-minded politicians in Southeast L.A.'s neglected, corruption-riddled suburbs aren't holding their tongues — at a press conference in Bell Gardens, several of them decried Calderon's influence in the region and demanded he step down. One anti-corruption crusader, Assemblywoman Cristina Garcia, declared that Calderon "puts everyone under a horrible cloud."
Daniel Crespo, Bell Gardens mayor, says Calderon once told him he saw himself as the "Kennedy of the southeast of L.A."
"You're no Kennedy," Crespo said. "You need to resign."
Calderon has slammed back, issuing a statement via his spokesman, Mario Beltran, accusing Garcia of coveting his seat and assuming "the role of judge and jury." (Beltran once worked for Cedillo and was being groomed by the Calderons, but ruined his political career in 2006 when he was convicted of falsely telling LAPD that black men stole his wallet — in fact, he'd lost it near a Skid Row hotel after he staggered down the hall, drunk, shouting at people. Then, in 2009, Beltran was convicted of diverting campaign funds — to pay his legal bills.)
Calderon suggests that all officials, if caught on tape, would come off bad: "I do hope that Ms. Garcia comes to understand that what has happened to me could happen to anyone in public office," he declared.
Sean Rossall, a crisis communications expert, advises officials immersed in corruption scandals who insist they are innocent to "take the high road" and not question their colleagues' motives."If you burn your collegial relationships and supporter base now, you're never gonna come back from it," he says.
Calderon lashed out after president pro tem Steinberg, the man Calderon described to the undercover agent as "my very good friend," had already booted his embattled colleague from the Film Commission and stripped him of his numerous committees — and after state Senator Ricardo Lara had kicked Calderon off the influential Latino Legislative Caucus.
Just a few years ago, tremendous power was concentrated in Calderon's hands by past Senate president pro tem Don Perata, who made him chairman of the Elections Committee the year it tried to influence how California drew its voting districts.
Steinberg has emphatically denied that he is under investigation, and he told the media that his once-close friend Calderon was engaged in "pure fantasy" when he claimed the FBI wanted him to wear a wire.
Steinberg's spokesman, Mark Hedlund, tells the Weekly that Steinberg is "determined that he is not going to let this be a distraction."
In an unusually fiery item on Nov. 17, Sacramento Bee columnist Dan Morain, a former investigative reporter for the L.A. Times, defended Steinberg's ethics, writing that Calderon's attacks are "pathetic and predictable, given the pen where he has wallowed."
But Calderon appears past the point of playing nice. The scandal is threatening his livelihood, and maybe his freedom, and it has thrown into tumult California's Legislature — and the question of which two Democrats will emerge to lead the powerful state Senate and the influential Latino Caucus.
The leaked affidavit has Ron Calderon telling the FBI agent that he's agreed not to challenge Ricardo Lara of L.A. for leadership of the Latino Caucus — a political deal forged with $25,000 deposited by one of Lara's allies, Sen. Kevin de León, into Californians for Diversity. The FBI alleges that the "diversity" fund, purportedly created to further empower the Latino Caucus by electing more Latinos, was a means to funnel money to Ron Calderon via Tom Calderon. Tom was working for the PAC that controls Californians for Diversity.
The probe may already have hurt Tom Calderon, a public affairs consultant and former assemblyman. In May, four weeks before his brother's legislative office was raided by the FBI, he was asked by California Speaker John Pérez to leave the scene of the annual Pebble Beach Speaker's Cup, a political fundraiser. The Times later reported that a $20,000 check written by Pacific Hospital of Long Beach for Tom Calderon's ticket into the tony event was refunded, and quoted Pérez's office as saying that Pérez had cut ties to Tom Calderon in 2012. Michael Drobot, former CEO of Pacific Hospital, which was sold to a new owner in October, is accused in the FBI affadavit of paying Ron and Tom Calderon more than $1 million in bribes.**
Then, last week, Tom abruptly dropped out of his latest political race — to capture Ron Calderon's open senate seat next June. He insisted to the Whittier Daily News that his decision was not related to the FBI probe.
In the much bigger battle among Democrats over who will replace the termed-out Steinberg as senate president pro tem, de León is considered a top contender. De León would be the first Southern Californian in 20 years to hold this pivotal post, which has been dominated by Northern California politicians. Regardless of whether de León is tarred by the scandal, his ally Calderon's resignation might affect what could be a close vote.
Even if he refuses to resign, Ron Calderon is termed out next year, and was already pursuing a plan to collect more contributions by creating a fund to run for state controller — watchdog of the state's money and the person who writes the checks.
It might bother some that, according to the leaked document, the "Ron Calderon for Controller 2014" fund was one of the buckets into which Calderon told Rocky Patel he could funnel his money.
**Correction: An earlier version of this story incorrectly stated that the Speaker's Cup fundraiser occurred four weeks after the FBI raid on Calderon's office. It occurred four weeks before the raid.