World Events

A Chinese developer will pay $1 million in L.A. bribery case

The subsidiary of a Chinese-based real estate company has agreed to pay $1,050,000 to resolve a federal investigation into its involvement in a bribery and fraud case, federal prosecutors said Wednesday.

In a deal struck with the U.S. Attorney’s Office in Los Angeles, Jia Yuan USA Co. Inc. will pay the financial penalty and continue cooperating with the federal government in its probe of Councilman José Huizar and other figures, according to a copy of the agreement. In exchange, the government agreed not to pursue criminal charges against the company.

In a statement, the U.S. Attorney’s Office said it had decided not to prosecute because company officials had taken responsibility for its conduct in a “timely” way, fired a real estate consultant who later pleaded guilty in the corruption probe and cooperated with investigators. The agreement does not prevent prosecutors from charging individuals who work at Jia Yuan USA or its Chinese parent company, Shenzhen Hazens.

Jia Yuan USA, based in Arcadia, was set up to redevelop the Luxe City Center Hotel in downtown Los Angeles, replacing the existing nine-story hotel with a new, much taller hotel and residential towers.

Huizar, as the head of the City Council’s powerful planning committee, helped secure approval for the project, which was located in his district, after receiving benefits from the company and some of its employees, prosecutors said.

In the agreement, Jia Yuan admitted that Shenzhen Hazens partially paid for Huizar and his family to travel to China.

The developer also confirmed that a Jia Yuan employee had provided Huizar and former Deputy Mayor Ray Chan — identified in the filing as Individual 1 — with Katy Perry concert tickets shortly after Chan and Huizar helped resolve an issue at a Hazens hotel involving compliance with the Americans With Disabilities Act.

The three tickets were valued at $1,000, according to the agreement.

Huizar has pleaded not guilty to racketeering, bribery and other federal charges. His trial is set for next year.

Jia Yuan also admitted providing in-kind campaign contributions to several U.S. political candidates by hosting reduced-cost fundraising events at the Luxe hotel. Some of those events took place at the direction of a foreign national barred from participating in U.S. elections, investigators said.

The Times reported last year that several candidates, including U.S. Rep. Judy Chu and Los Angeles City Council members Herb Wesson and Monica Rodriguez, held political fundraisers at the Luxe without paying the hotel for those services. All three said they never received invoices from the hotel and promised to pay the bill after being contacted by The Times.

Jia Yuan employees also made campaign contributions to U.S. political candidates that were later reimbursed by the company at the direction of a foreign national, who was prohibited from participating in U.S. elections, prosecutors said.

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