‘The state has created a breeding ground for bribery and favoritism. This is not hyperbole. These are facts.’
millions of dollars in revenue, and the town quickly gained a reputation as the next “mecca” of weed.
By 2018, cannabis interests had become a major power broker in the city’s political machine. But some pot business owners were unhappy and wanted changes. The local cannabis business association was pushing the city to extend the terms of licenses to the applicant’s lifetime and to provide a path for them to sell their licenses.
In that year’s election, the Lynwood Cannabis Assn. asked council candidates to sign a pledge card. The card promised that the signer would “fully support” the association and back “the industry and the efforts underway to modify the current city ordinance and development agreement for the members of the organization.”
“Let me know when each candidate signs it so I can give direction to the treasurer to issue the check,” one Lynwood Cannabis Assn. board member wrote to other leaders of the group in an email reviewed by The Times.
In other emails, the association’s president, Tony Torres, asked one of the candidates, Candice Nunez, to sign the card and said she would receive “a check for $15,000 when you return the pledge card.” Torres promised in another email that the pledge cards would be kept confidential until after the election “to avoid anyone potentially using this information in a negative way toward your campaign.”
Nunez recalled thinking when she saw the card, “I’m selling my soul.” Still, she signed and returned the pledge. She received the $15,000 check a few days later and showed it to a Times reporter.
She said she feared she might be engaging in illegal bribery and never deposited the check.
Nunez lost the election. Three candidates who won received a combined $40,000 from the cannabis association, according to campaign finance records.
Councilwoman Marisela Santana, who received $15,000, acknowledged signing the pledge. She said she already favored the association’s proposals because they were good for the city. “The best way to ensure that the cannabis industry grows in such a way that it doesn’t harm the community is to engage the industry and make policy decisions that benefit the Lynwood community first,” Santana said.
Torres, the association president, said in a brief interview that the pledge card didn’t result in any major legislative gains for the association. “Nothing came of it. We never brought it up again,” he said. He declined to comment further.
City records show the council approved some of the association’s requests, including allowing businesses to sell their licenses.
Interest groups are allowed to ask election candidates to promise support for legislative causes and to offer campaign contributions as long as there isn’t an explicit cashfor-votes deal, legal experts said.
Prosecutors face a high bar trying to establish that a campaign contribution amounts to a bribe. They have to show an explicit quid pro quo agreement between the public official and the donor, and that there was corrupt intent.
Bob Fellmeth, a University of San Diego law professor and former white-collar crime prosecutor, questioned whether the Lynwood pledge’s language was specific enough to qualify as a bribe, but he said it “could be an interesting test case to bring.”
“They’re flirting at the edges of felony bribery,” he said. “They’re getting pretty close.”
No charges have been filed in connection with the pledge.
Nunez, the unsuccessful candidate who didn’t cash the association’s check, said she was introduced to the association during a meeting at Tequila Jack’s restaurant in Long Beach that was brokered by Aide Castro, a longtime Lynwood councilwoman.
In 2017, Castro was on the payroll of the giant dispensary tracking app Weedmaps, earning $10,000 a month as a consultant — income she didn’t report on her financial statements as required by state law until she was questioned by The Times.
She did, however, disclose ownership stakes in two cannabis companies, which she estimated at the time to be each worth more than $1 million.
She paid nothing for her shares in the companies, and told The Times that she received her ownership stakes in return for providing the businesses with her government expertise. Castro served on the council until the end of 2020, when she was termed out.
The California Fair Political Practices Commission, which enforces state law on disclosing such financial ties, opened an investigation into Castro’s links to cannabis. The inquiry, launched after The Times’ report more than three years ago, is ongoing.
Lynwood does not have its own ethics agency to conduct such inquiries. Few cities and counties do, which means there is little independent oversight of the financial relationships between local officials and the cannabis industry.
The Times identified more than a dozen government officials statewide who received income — ranging from thousands of dollars to hundreds of thousands — from cannabis companies or had interests in weed businesses while still in office. The payments are legal as long as officials disclose them and don’t cast votes that would financially benefit the firms paying them.
Even when legal, such arrangements raise doubts about whether government officials voting on cannabis issues are looking out primarily for the interests of the public or the interests of the pot industry, good government experts said.
“Maybe they’re completely ignoring their financial interests . ... Maybe they’re making decisions that are not in the best interests of their constituents because they’re trying to put some money in their pocket,” said Tracy Westen, a government ethics expert and founder of the now-shuttered Center for Governmental Studies. “At the very least, it becomes a public confidence issue.”
As Santa Ana’s mayor, Miguel Pulido helped reshape the city for more than a quarter-century. The Orange County city became a pioneer in the region for allowing medical marijuana dispensaries before the legalization of recreational pot.
Pulido has come under fire for his support of the cannabis industry. A former police chief said in a lawsuit that he passed along a report to the district attorney’s office alleging that Pulido had accepted $25,000 in exchange for guaranteeing a cannabis license, and sources told The Times four years ago that county and federal authorities launched criminal investigations of Pulido. He was never charged and denied wrongdoing.
In late 2020, Pulido testified in a sworn deposition that while mayor he received a $10,000 consulting payment from Touchstone, a licensed cannabis company operating in the city. Pulido didn’t report income from Touchstone on his statement of economic interests.
Responding to questions from The Times, an attorney for Touchstone denied the company paid Pulido but didn’t respond to questions about the deposition.
Pulido’s testimony detailed the work he did for the company, the amount he was paid and his close relationship with the company’s owner. He said he was paid to help the cannabis business get off the ground by putting the company in touch with others who sold the necessary equipment.
Santa Ana spokesman Paul Eakins confirmed that in April 2019 Pulido spoke to a staffer in the city’s planning division, which regulates cannabis, about whether Touchstone was required to build a wall to hide a carbon monoxide tank from the street. He said Pulido never asked for special treatment for Touchstone. Pulido, whose mayoral term ended in 2020, did not return phone calls from The Times.
In the far reaches of California’s northern region lies sparsely populated Trinity County, part of the famed Emerald Triangle, a wide expanse of lush forest and mountains renowned for its high-quality weed. Whether to allow cannabis farms to operate became a lightning-rod issue in the county’s rural communities, with some blaming pot for destroying an idyllic way of life.
In 2018, county Supervisor Barbara
“Bobbi” Chadwick and her husband sold their 80-acre ranch to a pot farming company, Family Trees LLC, for $1.5 million, court records show. Family Trees agreed to pay for the property in installments.
As the monthly payments arrived, Chadwick urged her colleagues on the board to allow pot farmers to grow far more cannabis. Family Trees’ head grower sent an email to Chadwick and other supervisors in support, asserting that removing limits on pot growing would allow the farm to “once again send profits back into the [local] economy,” according to county records.
But a majority of the board voted to sharply curtail how much cannabis a licensed farm was allowed to grow.
At a candidate’s forum in 2020, Chadwick said she had no relationship with a cannabis business and only used the drug as medicine for ailing relatives. She did include the sale of the ranch on a financial disclosure statement filed for 2018 but did not disclose on subsequent statements the ongoing payments from Family Trees.
Chadwick, who served on the board from 2017 until 2021, told the California Fair Political Practices Commission that Family Trees also paid her husband’s contracting firm more than $96,000 for work the company did on the ranch from 2018 through 2020, according to county emails obtained by The Times under a public records request. She did not detail those payments on her financial disclosure statements.
Chadwick declined to answer questions from The Times, saying in a brief phone interview last year only that she has no financial interests in cannabis in Trinity County.
In a lawsuit filed a day before the interview, she and her husband claimed Family Trees owed them hundreds of thousands of dollars in outstanding payments for the ranch.
Chadwick and her husband had been receiving annual payments of $180,000 and monthly payments of $1,900 from Family Trees since June 2018, but the firm was no longer paying in 2021, according to court records. The couple’s lawyer said the dispute was resolved; the suit was dismissed in January.
Attorney Charles M. Farano, who represented Chadwick and her husband in the lawsuit, said that she had no interest in the firm’s pot business and that the purchase agreement was solely for the land and “had nothing to do with cannabis.” He said her “voting record on the cannabis business in general stands and is based upon her position regarding cannabis.”
“She has never had a conflict of interest regarding cannabis and currently has no conflict in these regards,” Farano said, adding that Chadwick “has complied with all disclosure laws.”
Brad Gilbert, a longtime friend of the Chadwicks who incorporated Family Trees and oversaw its county license application, said the firm followed all state and county procedures and has created jobs for local residents.
Trinity County Administrative Officer Richard Kuhns told The Times shortly before his retirement in May that he was concerned at how quickly planning department staff processed Family Trees’ license and questioned whether it was properly handled.
“It just stinks all around,” Kuhns said.
For the city of Calexico, the promise of cannabis was too good to pass up.
The small border community in Imperial County was desperate. City officials were considering layoffs of essential workers, and 20% of the 40,000 or so residents were living in poverty.
By permitting cannabis businesses, council members argued, money would pour into local coffers and bring better times.
“I truly believe that God has it here for a reason,” the city’s mayor, Armando Real, said at a June 2017 council meeting where he and his colleagues voted to allow pot businesses.
But instead of blessings, cannabis brought disgrace.
In late 2019, a businessman known simply as Manny met with two local government officials — Councilman David Romero and a city commissioner, Bruno Suarez. Manny drove a white BMW and wore guayabera shirts and a leather jacket. A clean-cut 30something, he was an avid NFL fan and sprinkled his conversations with Mexican slang.
Inside a downtown cafe decorated with colorful posters and images of artist Frida Kahlo, Manny said he and his partners in L.A. wanted to open a dispensary. Suarez offered to help for a price — $35,000.
Suarez said the money “guarantees you a … top spot in the queue” for city permits. Romero noted that he had the authority to revoke other applicants’ permits and could push Manny’s to the front.
In early January 2020, the three men met again at an Italian restaurant in neighboring El Centro. After bonding over beers and woodfired pizza, the men headed to the parking lot where Manny handed Suarez two envelopes containing a total of $17,500 in cash. “We’re good?” Manny asked. “Trust me,” Romero responded. “In my line of business, I can’t f— up.”
In late January, the three men met again at the Italian restaurant and Manny handed Suarez envelopes stuffed with $17,500 in cash.
Moments later, federal authorities swooped down and arrested the two officials. Manny, it turned out, was an undercover FBI agent. His conversations with the two officials had been recorded and were documented in court filings by federal prosecutors.
Romero and Suarez pleaded guilty to conspiracy to commit bribery and were sentenced in May 2021 to two years in prison.
Beyond public embarrassment, Calexico has little to show for its embrace of weed. Major cannabis projects never materialized. Nor did the anticipated jobs or $700,000 in annual tax revenue that had been projected. The city has taken in only about $220,000 since first issuing licenses in 2018.
In interviews with The Times before they reported to federal authorities in June 2021, Romero and Suarez said the undercover agent led their conversations, but both expressed remorse and said they made mistakes.
A key error that officials made, Romero said, was to limit the number of dispensary licenses in the city. That created tense competition for just 12 permits and an incentive for people to try to game the system.
“If you put a number on it, you’ll turn it into a political mess,” Romero said of the process, hours before he was remanded to the custody of U.S. marshals.
“It was just a ticking time bomb.”
former Montebello city councilwoman who had opposed the city’s pot regulations and lost her reelection bid in 2018
California’s legalization of recreational cannabis in 2016 ushered in a multibillion-dollar industry estimated to be the largest legal weed market in the world. But many of the promises of legalization have proved elusive. In a series of occasional stories, we’ll explore the fallout of legal pot in California.