FBI investigation of Oakland mayor ruins the city, sparks concerns about the the political influence of the family
FBI search warrants conducted in Oakland including the residence of the city’s mayor Sheng Thao — have put a spotlight on an ongoing investigation into the influence of politicians The Duong family as well as California Waste Solutions.
By Salvador Hernandez, Ruben Vives
Jun 22, 2024 08:27 PM
While it’s still unclear why FBI agents raided the home of Oakland Mayor Sheng Thao this week, the action has cast a renewed spotlight on a years-long probe into the political influence — and campaign finance machinations — of one prominent local family.
A long-running inquiry
Since 2005 five years, investigators from the Oakland Public Ethics Commission and the state Fair Political Practices Commission have been looking into allegations that senior executives of California Waste Solutions, namely members of the Duong family, made use of “straw donors” to circumvent donations limits and to fill the campaigns of government officials.
On Thursday, when federal agents left with boxes left at Thao’s residence they also issued warrants at the Oakland office of Cal Waste Solutions, which offers recycle services for the city of Oakland, FBI officials confirmed. Agents also scoured the residences of the chief executive officer, David Duong; and his son, Andy Duong, a purchasing agent responsible for marketing and public relations for the business.
The FBI hasn’t officially been accused Thao or other members from Duong or members of the Duong family of any wrongdoing. Thao’s lawyer, Anthony J. Brass spoke to The Times in an email that the mayor does not have details or evidence that she’s the focus of the federal inquiry and that she will cooperate with investigators.
“She has nothing to hide,” Brass stated. “It’s unfortunate that she’s been forced to suffer the negative visuals of this warrant of search executed on her house. She could have cooperated with the investigation, without the necessity of this search.”
Cal Waste Solutions issued a statement on Saturday.
“We were very surprised by the federal law enforcement’s search of our homes and office on June 20,” the statement reads. “To assist officers of law enforcement in executing their obligations We, as decent citizens who adhere to the law, have cooperated and have provided all the necessary conditions for the law enforcement agencies to effectively perform their duties. We believe that we’ve not been involved in or engaged in any illegal act and are awaiting the verdict on the part of law enforcement agencies.”
David as well as Andy Duong did not respond to inquiries for comments.
Another big win for the city
For Oakland, a city struggling with a string of recent reputational damage it’s a bad time to be there to at the very least. Prior to the incident, Thao faced a potential recall due to concerns about the issue of crime, a concern so pronounced that it led Governor. Gavin Newsom to deploy 120 California Highway Patrol officers to Oakland as part of a state-wide law enforcement initiative to combat violence.
Restaurants that are big chains like In-n-Out or Denny’s have closed their local branches in response to security issues. A recent celebration of Juneteenth was tragically interrupted by a gunshot that left several injured.
The crackdown may have some positive resultsrecent data from Oakland Police Department show a 33% decrease in crimes by 2024 as compared to the same time in the previous year, the police raids have raised questions regarding the Oakland city’s direction.
“This is the kind of attention we don’t need,” Brenda Harbin Forte who was the person to start her Oakland United to Recall Sheng Thao initiative.
She said that the federal investigation, which she claimed is a further negative mark on the city.
“I think people who were on the fence about the recall will now understand that we need to clean house from top down,” she added. A recall initiative is likely to appear placed on the November ballot.
Ethics investigation
Simon Russell, a special investigator at the city of Oakland’s Public Ethics Commission, confirmed that the agency is currently conducting an investigation underway into Cal Waste Solutions that started in the year 2019.
The commission has stated through court papers that this alleged election-related financing scheme involved multiple cycles and involved straw donors who made contributions to various committees controlled by candidates.
In order to find those who participated in the scheme the commission issued subpoenas which included one to Phuc Hong Tran, board member of the Oakland Vietnamese Chamber of Commerce and a close friend of David Duong.
When Tran was unable to comply with the subpoena, both the commission and the Oakland city attorney tried to enforce it through Alameda County Superior Court, providing in the court for the very first time the nature the scope of their probe.
Tran did not respond immediately to a request for comment.
The court document from January indicated that investigators were examining contributions by members of the Sheng Thao For Oakland City Council committee for 2018. This included contributions of Kim Huong Vietnamese Cuisine that investigators claimed were re-laundered.
Investigators also looked at other contributions Tran contributed to council committees that are a part of the candidates for the chance to reelect them in 2018.
Subpoenas have been issued by the agency for family members and friends of the Duong family as well as business associates – in search of emails, texts as well as communications concerning campaign donations from 2016 to 2018, the records reveal.
Russell refused to give details regarding the case however, he said that it was a case of laundering campaign funds. He denied having any answer when asked if the agency was in contact with officials of officials from the FBI and with the Department of Justice regarding the investigation.
The ethics commission is also conducting an inquiry into Thao which was launched on July 20, 2022 Russell stated, but Russell would not provide details.
Subpoenas, public records and court documents indicate that watchdog organizations had been looking into Cal Waste Solutions and its contribution to Oakland politics for a long time. This includes the company’s relations with Thao in 2018, who was first the first Hmong candidate who was elected into the presidency of the largest U.S. town.
A family’s rise
The tale of the Duong family, at first glance appears to be a fulfillment of an American dream. The Duong family owned the largest mill of paper located in South Vietnam, but was forced to leave the country in the Vietnam War, according to an account posted on Cal Waste Solutions’ website. Cal Waste Solutions website.
The Duongs were settled in San Francisco, 16 members of the family packed into two studio apartment. Over the years, the family kept a box of cardboard in their homes until the midnight hour -and saved up until they could afford the recycling center situated in West Oakland.
The warehouse that was initially set up has expanded into the self-proclaimed biggest recycling firm located in Northern California, with more than 300 employees. The company is run by 3 siblings: David, the chief executive; Kristina, the chief financial officer, and Victor who is vice president.
The Public Ethics Commission opened its investigation into the straw donor donations in the year 2019. The commission issued subpoenas to business associates who are associated with the family.
Court documents submitted by the FPPC provide details of the ways an ex- business close to Andy Duong, the company was allegedly trying to evade limits on contributions to campaigns through the use of associates and friends to donate to candidates for political office, and later reimbursing them in cash in order to hide the source of the contributions from.
“CWS was the true source of at least 93 contributions to multiple local campaign committees,” the court’s record says, with the intention of the campaign being “to curry favor with candidates and provide more access to candidates.”
The donations were made according to legal documents filed by the courts, to areas where the business was or planning to do business.
Contributions were given by political parties within Oakland, San Jose and Santa Clara County, the document states, suggesting that the investigation may extend beyond Oakland.
The investigation also found that Andy Duong made sure that the firm’s activities were reported to politicians.
“Duong ensured the targeted candidates were aware of his commitment to raise money for their campaign by attending candidate fundraisers, bringing individuals to campaign fundraisers, at times hosting campaign fundraisers, providing the committees and candidates with multiple checks,” the FPPC claimed.
A former business associate of mine disclosed to investigators the way Andy Duong allegedly approached him to find people willing to make political donations to his preferred candidates and then refund the cash through a drawer that was stuffed with cash in his office.
The investigation is ongoing. FPPC officials have not yet responded when asked for comments.
Thao has not made public statements regarding the investigation, but her attorney has said that the mayor is expected to continue doing her job.
Some critics also said they would like Thao and the city’s leaders were more open regarding ongoing investigations.
“You need to say something to reassure your residents because they’re worried and scared about who will be swept up in this,” said Harbin-Forte who is the leader of the recall campaign against Thao. “What’s going to happen to our city’s government? There’s a deadline for the budget next week. Where is the direction?”
