Scandals in Charlotte city hall and the California state house

March 28, 2014

By Matthew E. Milliken
March 28, 2014

Wednesday is a day that many political aficionados in Charlotte, N.C., and the San Francisco Bay Area will long remember.

Patrick Cannon, a longtime city council member, radio host and parking-company business executive, had been Charlotte’s mayor for less than six months when he was arrested Wednesday. Federal prosecutors charged the 47-year-old Democrat with accepting more than $48,000 in bribes from undercover FBI agents who purportedly wanted help developing real estate projects in North Carolina’s largest city.

The illicit gifts included a hefty amount of cash as well as the use of a luxury apartment and a trip to Las Vegas. The politician, who was the target of a three-year-long sting operation, allegedly sought as much as $1 million in additional money and favors.

Cannon could face as much as 50 years of prison time and $1 million in fines if convicted on all counts. He resigned the mayoralty hours after being arrested.

Cannon had been elected to the post in November after President Obama appointed Charlotte’s previous mayor, fellow Democrat Anthony Foxx, to be U.S. transportation secretary.

Here’s a snippet of Mitch Weiss’ Associated Press story on Cannon’s arrest:

“OK, so I mean, ’cause I’m not, I’m not one of those Chicago or Detroit type (of) folk,” Cannon told the agent, apparently referring to high-profile corruption cases in those cities.

Cannon ended the conversation by saying he looked good “in an orange necktie, but not an orange suit,” according to the complaint.

As eye-opening as this is, this was only the second most interesting corruption story involving a politician to break on Wednesday. On the same day as Cannon’s arrest and resignation, federal prosecutors also accused California state Sen. Leland Yee of wire fraud and conspiring to import arms illegally and to deal firearms without a license. The Democrat could be sentenced to more than a century in prison and fines of more than $1.5 million if he’s convicted on all seven counts.

The charges against Yee and a number of other defendants are detailed in a 137-page-long affidavit filed in court Wednesday as the culmination of a five-year-long investigation. Perhaps the document’s most shocking contents are the accusations that Yee, an outspoken gun-control proponent, had a coolly calculating attitude about selling firearms.

“Do I think we can make some money? I think we can make some money,” the state senator said, according to the complaint. “Do I think we can get the goods? I think we can get the goods.”

The complaint says Yee described his approach to arms dealing as “agnostic.”

“People want to get whatever they want to get. Do I care? No, I don’t care. People need certain things,” Yee said, according to the complaint.

Gun lobbyists understandably ripped Yee, who is accused of having discussed a plot to import shoulder-mounted missile launchers from dissident Muslims in the Philippines.

“This poster boy for gun control is a scumbag,” a National Rifle Association spokesman told the Los Angeles Times.

Yee, a 65-year-old who was born in China, is also charged with pay-to-play — trading cash for favors. In exchange for help getting elected, Yee allegedly agreed to brief an undercover agent on marijuana legislation and to arrange a meeting with a fellow California state senator.

Another defendant in the case, former San Francisco school board member Keith Jackson, worked as a fundraiser for Yee. During the state senator’s unsuccessful run for the San Francisco mayoralty, Jackson allegedly arranged for an undercover agent to make illegal campaign contributions. According to the affidavit, the fundraiser described “how much money Yee would control if elected mayor.”

Yee was running this year to become California’s secretary of state but withdrew from the contest on Thursday. The Democratic-controlled state Senate suspended Yee on a 28-1 vote Friday morning. (Two other Democrats were also suspended by their colleagues Friday, per the San Francisco Chronicle: Ron Calderon of Montebello, who was charged with bribery and corruption in an FBI sting last month, and Rod Wright of Baldwin Park, who was recently convicted on eight counts perjury and voter fraud.)

The accusations — as yet unproven in a court of law, one must note — about the extent of Cannon’s and Yee’s misdeeds, among others, are jaw-droppers. They’ve inspired plenty of stewing about betrayal, hypocrisy and greed, as it should; see the NRA quote above for just one example.

But while it may be convenient to pretend that public service is unique in attracting workers who are predisposed to hypocrisy and criminality, it wouldn’t be true.

Just look to what happened on Monday, when after a five-month trial, jurors unanimously convicted five men and women on 31 counts of fraud. The defendants were all assistants to Bernie Madoff, the infamous financier who was arrested in 2008 on charges of running a massive Ponzi scheme.

The convictions of his aides this week came even though Madoff has insisted ever since admitting to fraud in 2009 that he had sole responsibility for the subterfuge. The jury didn’t buy that defense, even after two defendants made the unusual move of taking the stand to testify about their inexperience and naïveté as well as Madoff’s sophistication and charm.

The disgraced Wall Street icon, who will spend the rest of his life in federal prison, launched his plot in the 1970s and ended up attracting nearly $18 billion in desposits. When the $47 billion in profits his investments had supposedly earned for his customers were revealed to be fake, many Madoff clients were left destitute. The victims included wealthy investors, Jewish charities, celebrities, retirees and the owners of the New York Mets.

Madoff and about half a dozen of his associates have pleaded guilty to fraud, including his former finance chief, who was a star prosecution witness in the recently concluded trial. Many if not all of those people will likely end up behind bars.

But as Dunstan Prial notes in a scathing column for Fox Business News, there are dozens and perhaps hundreds of investment professionals “who either laundered Madoff’s money for him (unintentionally, they would claim) or used their own reputations as financial gurus to rope unwitting investors into Madoff’s web of lies.”

Some of these Madoff enablers will be on the hook for money. For instance, JPMorgan “agreed to pay more than $2 billion earlier this year to make potential criminal and civil charges related to its Madoff problems go away. The settlement speaks for itself.”

But despite Madoff’s lack of transparency and his too-good-to-be-true reported investment returns, no one from JPMorgan or other businesses that funneled money to Madoff will face jail time. This is the case, Prial notes, even though one Connecticut financier stepped up its marketing for Madoff in late 2008, as the fraudster was desperately trying to prevent his Ponzi scheme from collapsing.

So yes, this has been a good week to stew piously about the corruption of public servants, and that’s all fine and good. But let’s not assume that working in the private sector automatically makes one as pure as the driven snow.

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