LOS ANGELES – A downtown Los Angeles-based company was sentenced today to five years of probation and was fined $4 million – the maximum penalty under the law – for the actions of its billionaire Chinese real estate developer owner and others who provided more than $1 million in benefits – including luxury trips and a sham loan – to bribe then-Los Angeles City Councilman José Huizar to obtain city approval to build a 77-story skyscraper.
Shen Zhen New World I LLC was sentenced by United States District Judge John F. Walter, who noted that this criminal case exposed the “crushing costs of public corruption.”
At the conclusion of an 11-day trial that ended in November 2022, a jury found Shen Zhen guilty of three counts of honest service wire fraud, four counts of interstate and foreign travel in aid of bribery, and one count of bribery.
Shen Zhen’s owner – Wei Huang, 57, a resident of Shenzhen, China, who also maintains a residence in San Marino – is also charged in this case, but he has yet to make a court appearance in this matter. He is a fugitive believed to be in China.
In 2010, Shen Zhen – on Huang’s behalf – purchased the L.A. Grand Hotel in downtown Los Angeles. The property was located in the 14th City Council District, whose representative at that time was Huizar.
As part of his roles on the Los Angeles City Council, Huizar, 55, of Boyle Heights, was the chairman of the Planning and Land Use Management Committee, commonly referred to as the PLUM Committee, which oversaw major commercial and residential development projects in the city.
In June 2018, Shen Zhen filed an application with the Los Angeles City Planning Department to redevelop the L.A. Grand Hotel into a skyscraper featuring a mix of residential and commercial uses.
From February 2013 to November 2018, Shen Zhen, acting through Huang, provided Huizar with cash, casino gambling chips, flights on private jets and commercial airlines, stays at luxury Las Vegas hotels and casinos, expensive meals, spa services, prostitution services, political contributions, and a $600,000 collateral for Huizar to confidentially settle a pending sexual harassment lawsuit against Huizar by a former staffer that threatened his career.
At the time Shen Zhen provided these items, it did so intending to influence Huizar to take official acts to benefit the L.A. Grand Hotel redevelopment project, a project that would have transformed Shen Zhen’s hotel into a 77-floor mixed use skyscraper that would have been the tallest such structure west of the Mississippi River.
Specifically, Shen Zhen intended that Huizar benefit the project by presenting motions and resolutions in various city committees; voting on the project in the PLUM Committee and City Council; acting in the PLUM Committee to expedite the approval process of the project; exerting pressure on other city officials to influence the approval process of the project; and introducing and voting on city resolutions to enhance the professional reputation and marketability of Wei Huang.
Source: Press Release