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Ethics allegations against LA Councilmember John Lee stir residents in Valley

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The day after Los Angeles City Councilmember John Lee was accused this week of violating city ethics laws for not reporting gifts he allegedly got from a developer while he was a city employee, his city council colleagues were largely silent while some residents in his council district said they were not surprised by the accusations.

The Los Angeles Ethics Commission announced on Monday, Oct. 2, that there was “probable cause” to believe that Lee, in 2016 and 2017 as chief of staff to then-City Councilmember Mitchell Englander, accepted gifts far in excess of the gift limit for city officials, failed to report the gifts, misused his position, and aided and abetted Englander’s misuse of his own position.

The probable cause finding by Ethics Commission staff doesn’t necessarily mean that Lee violated the law. That will be determined at a future hearing of the Ethics Commission board.

Lee denies wrongdoing and has pledged to “vigorously fight these baseless accusations.”

John Lee, Los Angeles City Councilmember, District 12 on Monday, May 22, 2023. (Photo by Dean Musgrove, Los Angeles Daily News/SCNG)
John Lee, Los Angeles City Councilmember, District 12 on Monday, May 22, 2023. (Photo by Dean Musgrove, Los Angeles Daily News/SCNG)

Trial lawyer and former federal prosecutor Neama Rahmani, who is also a former member of the Los Angeles Ethics Commission, said he was surprised that the commission hadn’t pursued an investigation earlier.

“The question is, why he wasn’t charged when all the Englander stuff came out? I really don’t have an answer,” he said, referring to a scandal that sent Englander to prison to serve a 14-month sentence in 2021. “This really should have been handled years ago,” Rahmani said.

He added, “When it comes to the ethics commission until the public accusation is filed, everything is secret. … They don’t want the fact that there’s an ethics investigation to come out until charges are filed.”

Accepting gifts, Rahmani said, wasn’t considered a violation of ethics law on Lee’s part. Instead, his failure to report the gifts in 2017, right after receiving them, was the problem.

“This is a big deal when it comes to government ethics. You’re getting gifts from developers,” Rahmani said. “This is exactly what the (city’s ethics) gift code is designed to prevent, and is happening. So this is something that really should have been addressed, frankly, years ago.”

As Lee was walking to the City Council chambers on Tuesday, he and his spokesperson referred a Daily News reporter to his statement released on Monday.

Lee said in the statement, “For the last 20 months, commission investigators have wasted critical taxpayer resources to investigate a dinner in 2016 that I do not recall attending, have drastically inflated the amount of food and beverages I consumed during a June 2017 trip in Las Vegas during my final 11 days as a City Council staff member, and lodged accusations that are completely false.”

Lee noted that he had never been a target or a subject of any federal investigation.

“Throughout this process, I have gone above and beyond to cooperate with the Commission’s investigation in the name of transparency. I have provided bank statements that corroborate what I recalled about this trip, sat for interviews, and have been transparent every step of the way,” Lee’s statement says.

Normally, the Ethics Commission staff must issue a probable cause report within four years of an alleged violation. But if a person concealed the violation or acted in a deceitful manner – which is what Lee is accused of doing – the statute of limitation gets “tolled,” or extended, “for the period of concealment or deceit,” according to the accusation issued by the Ethics Commission.

Sometimes, Rahmani said, “the parties will agree to what’s called a ‘tolling agreement.’ That’ll extend the statute of limitations while the investigation is ongoing.”

Ex-Los Angeles city councilman Mitch Englander, his wife Jayne, left, and attorney Janet Levine, right, leave the federal courthouse in Los Angeles after a hearing Thursday, March 12, 2020. (Photo by David Crane, Los Angeles Daily News/SCNG)
Ex-Los Angeles city councilman Mitch Englander, his wife Jayne, left, and attorney Janet Levine, right, leave the federal courthouse in Los Angeles after a hearing Thursday, March 12, 2020. (Photo by David Crane, Los Angeles Daily News/SCNG)

Lee has served on the City Council since 2019 and is seeking reelection next year. In 2017, he left his job as chief of staff to Englander, who later pleaded guilty in July 2020 to a single felony charge, admitting he schemed to prevent federal investigators from learning about cash and generous gifts he received from a businessman.

A 2020 grand jury indictment of Mitchell Englander alleged that Englander tried to obstruct the federal investigation by making false statements and witness tampering. His arrest stemmed from a wider federal probe into “pay-to-play” schemes in which real estate developers purportedly curried favor with city officials.

The indictment describes a trip to Las Vegas, where a businessperson lavished Englander and a “high-ranking staffer” dubbed “City Staffer B” with hotel stays, casino chips, a $2,481 dinner, $24,000 in bottle service at a nightclub and limousine service.

After Englander was indicted, Lee maintained that during the Las Vegas trip, he was unaware of any illegal activities. Lee has said he is not City Staffer B. He said he was in Las Vegas and did “everything in my power to pay for and reimburse expenses related to this trip.”

City Council President Paul Krekorian said on Tuesday, as he was walking into the Los Angeles City Council chamber, that he only learned the details of the accusations the previous night.

“I have to consider what, if any, next steps will be taken,” Krekorian told reporters. “I’m not ready to do it yet.” Five other council members declined to comment on the situation Tuesday morning.

The accusation issued by the ethics commission details the cost of meals, drinks, hotel stays and other gifts that Lee allegedly received while a city employee, and failed to report in mandatory disclosure forms.

Ethics Commission staff found probable cause to believe that Lee received $7,831.50 in gifts, of which $6,891.50 exceeded the gift limits for city officials.

That included an evening of poker in Koreatown with Englander and persons identified as Businessperson A, Developer A, Lobbyist A and a fourth individual in April or May of 2017. The bill, which included alcohol and hostess service, came to about $800 – or $133.33 per person – and was paid for by Businessperson A, according to the accusation.

The accusations by Los Angeles Ethics Commission investigators state that a 2017 trip Lee and Englander took to Las Vegas was at the suggestion of Lobbyist A — to celebrate Lee’s recent announcement that he was leaving his City Hall job to do consulting in the private sector.

Although Lee paid for his flights, the ethics commission staff alleges that Lee and others did not pay for their transportation to and from the airport, their hotel rooms, or other hotel amenities. Ethics Commission staff estimated that Lee’s room and other amenities were valued at over $600 for two days.

The accusation also states that Lee received $1,000 in gambling chips from Businessperson A, which he lost playing Baccarat. Lee and others allegedly had dinner and drinks paid for by the unidentified businessperson, with Lee’s portion of the meal valued at $431.50, Ethics Commission staff estimated.

Lee and others went to a nightclub where Businessperson A spent about $24,000 and Developer spent another $10,000 on bottle service for the group, and the per person amount came out to $5,666.67, according to Ethics Commission staff.

The accusation states that Lee did not report these gifts in his 2017 disclosure form.

Porter Ranch Neighborhood Council board member and former president David Balen said that “there’s going to be a lot of people out there that are probably going to be pleased that the city is finally doing their job.”

“If you are a public official, the community holds you to a higher standard,” Balen said. “A lot of people in the government think they are above the law. With ethics, we hold people to a higher standard. Unfortunately, sooner or later, what goes around comes around and things come out.”

In his statement, Lee wrote, “In my 20-year career with the city, I have never received an ethics violation. When departing city service, I voluntarily and proactively contacted the Ethics Commission to ensure I understood my obligations upon leaving City service.”

Lee said he refused “to be bullied by investigators that are seemingly more focused on garnering headlines than pursuing facts, evidence and the truth, even at the expense of people’s reputations.”

He promised to “vigorously fight these baseless accusations and will never apologize for representing the people who live and work in Council District 12.”

In 2016 and 2017, including a trip to Las Vegas in 2017, Lee allegedly accepted gifts – many of which exceeded the city’s gift limit – from a business person and a developer, then failed to disclose the gifts on mandatory disclosure forms when he ended his city employment and did not amend the forms to disclose the gifts when he ran for City Council in 2019 and 2020, the ethics commission said.

According to the commission, during an investigation by the FBI and U.S. Attorney’s Office into public corruption, Lee helped  Englander try to mislead investigators about whether the two had made reimbursements for gifts they got during the Vegas trip.

Longtime Porter Ranch resident Patty Glueck was surprised to learn the ethics commission launched the investigation long after residents unsuccessfully pressured city officials to look into Lee’s involvement in Englander’s activities.

“Why (did) the ethics commission decide to take this on years after people are saying: ‘Hey, guys, you have to look at this,” she said.

Richard Mathews, president of the North Valley Democratic Club, launched a petition in 2020, urging Lee to resign, and collected about 2,000 signatures.

In a phone interview, Mathews said, “The only surprising thing (about the report) was that it’s taken the ethics commission so long to get this far.” He added, “He just shouldn’t be on the council.”

Porter Ranch resident Kyoko Hibino didn’t view the findings from the ethics commission’s report as surprising.

“It’s just another L.A. City Council-related scandal,” she said. “It never ends.”

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