“The more I learn, the more troubled I am. It’s clear that people feel obligated to give to charities when there
are people in positions of power who are asking for the money.”
I wish everybody was getting that “troubled” feeling like Robert Stern, president of the nonprofit Center for Governmental Studies, is. There’s a lot to be troubled about in all aspects of the way City Hall does business and Dave Zahniser in the Times uncovered a fragment of what is going on all the time.
His story, actually played on P. 1 of all places, connects the names of mayoral pals and moneyed big shots Henry Cisneros and George Pla among others to the ethics investigation of Robert Aguallo Jr., who retired as general manager of the city’s $10 billion employee pension fund in May.
Arguallo took a job in April with Cardinal Americas, Pla’s firm that had received help from his agency only two months earlier. And he was shameless about personally dunning beneficiaries or wannabe beneficiaries of investments from Los Angeles City Employees’ Retirement System (LACERS) for contributions up to $10,000 for his March 17 retirement party at the exclusive California Club downtown.
The 400 emails obtained by Zahniser “show LACERS employees performing an array of party-related tasks, such
as choosing the menu and reviewing the inscription planned for a
commemorative ‘whisper cut’ crystal bowl.”
The event raised $150,000 with two-thirds going to a “Robert Aguallo Jr.” scholarship to be administered by the Robert Toigo Foundation, a nonprofit that helps minorities get jobs in finance.
At least 16 companies bought tables that benefited or stood to benefit from LACERS, particularly from a program Arguallo developed to help minority and other companies that normally can’t raise the kind of $10 million investments that he helped provide.
Among those paying the $10,000 for tables was Palladium Equity Partners, which got a $10 million LACERS commitment for its efforts to capitalize on “the overall Hispanization of the U.S. society;” the real estate fund CityView run by mayoral pal and fund-raiser Henry Cisneros, the former Housing and Urban Development Secretary who got a $25 million LACERS commitment; Cordoba Corp.,
the George Pla company that runs Cardinal Americas, the start-up fund that got a
commitment of $10 million through Aguallo’s initiative and now employs him.
board agreed to give it a six-month extension after Aguallo
asked Pla to help him beef up his
party’s guest list by persuading former Los Angeles City Councilman
Richard Alatorre, now a City Hall lobbyist, to attend.
“Please let me know if you need help with the mayor,” Pla said in an email.
Deputy Mayor Sally Choi — the person
named as Aguallo’s replacement — received a complimentary ticket. “I
can assure you that no investment decisions were at all based on what
may or may not have happened at that retirement party,” she told the Times.
are many other insider connections but don’t expect much to happen
under the rules City Hall has written that make what happened illegal
only if you could prove the donations were directly linked to city
favors. Don’t expect Henry Cisneros, George Pla or anyone else involved
to say anything different than Sally Choi said.
As Arguallo’s attorney Fred Woocher put it so bluntly: “I don’t get what the big problem is. It happens all the
time. If you want to raise money for a charity, you pick an honoree and
then you use that person to hit up anyone they know that has money.”