The Binge Cases: Denise Didn't Come Home - The Sellout | 6: The Heyday

Episode Date: November 23, 2021

Gentrification comes in waves. Over years, a piece of downtown LA transformed from Skid Row, to a bastion for young artists, to a hipster neighborhood with some of the highest rents in the city. By 2018, Huizar was allegedly collecting bribes from developers planning a luxury high rise just a couple blocks from where some of his constituents were getting evicted. A Neon Hum Media and Sony Music Entertainment production. Subscribe on Apple Podcasts to binge all episodes now or listen weekly wherever you get your podcasts. Find more great podcasts from Sony Music Entertainment at sonymusic.com/podcasts Learn more about your ad choices. Visit podcastchoices.com/adchoices

As a kid growing up in Chicago, there was one horror movie I was too scared to watch. It was called Candyman. It was about this supernatural killer who would attack his victims if they said his name five times into a bathroom mirror. But did you know that the movie Candyman was partly inspired by an actual murder? I was struck by both how spooky it was, but also how outrageous it was. Listen to Candyman, the true story behind the bathroom mirror murder, wherever you get your podcasts. Okay, so there's this guy we know only as Executive M.

That's what the FBI calls him. Here's what we know about Executive M. He worked for a real estate developer called Carmel Partners, a company that puts together big, multi-million dollar projects. You know, high-rises, that kind of stuff. Executive M worked directly with Jose Huizar. And by the time he did, Huizar is the head of the plum committee. You know, that committee that makes decisions on developments all over the city? And Huad has got downtown in his district. That's why Executive M needed Wissad. Cuz Executive M was working on a big 35-story tower in downtown Los Angeles. That

tower was at 520 Mateo Street, and he was allegedly bribing Wissad to get it built in the Arts District. So, in September 2018, Wissad and Executive M are having dinner throughout Office Scene Brera, this really bougie Italian restaurant. They're talking about how a young female staffer working for Wissad is planning on filing a lawsuit against him. FBI documents don't name the staffer,

but Wissad's former executive assistant, Mayra Alvarez, sues him just a month later. Let me just say, we know all of this because of the FBI. There's a 138-page indictment of Wissad and a bunch of other legal documents that are full of text messages and word-for-word transcripts of phone calls between Wissad and his associates. And by the way, Wissad has pled not guilty to all of it. He's awaiting trial in 2022. So, Executive M offers to provide opposition research on this young female staffer. Basically, dig up dirt on her to discredit her.

Wisad thinks that this is a wonderful idea. He accepts. And he thinks the dinner went well. In fact, that night, he texts a lobbyist named Maury Goldman to explain the arrangement. Wisad will get dirt on a staffer, and Executive M will give Wisad money. Actually, he'll donate money to a political action committee for we sads wife Rochelle because by that point it seems that we said and Rochelle have decided they want her to represent his district after he reaches his term limit as a city council member we said says that he and executive M didn't

discuss an amount but he'd like Oldman to,000 to $20,000. And just to be clear, Rochelle hasn't been charged with a crime, and neither has Executive M. Carmel Partners would later agree to pay $1.2 million and admit what Executive M did to avoid being prosecuted by the feds. We sent both Rochelle and Carmel Partners questions about the allegations in the indictment. Neither got back to us. Okay, back to 2018. Two weeks after that dinner, at a fundraiser, Executive M gives Wisad an envelope. It's the dirt he promised to dig up on that young female staffer. Five days later, the Plum Committee meets and discusses the project Executive M is working on. Remember that 35-story tower in the Arts District?

Wissad votes it through, past a union objection. The committee also approves some changes to what the city's planning department recommended. So basically, the way the indictment lays it out, it's a pretty clear-cut transaction. Wissad delivers a vote, and Carmel Partners delivers the money and the dirt. And for Carmel Partners, at least, this was a sweet deal.

Because that vote would ultimately save Carmel Partners an estimated $14 million. From Neon Hub Media and LA Taco, this is Smokescreen, The Sellout. A podcast about a politician dogged by allegations of corruption, harassment, and pathological headiness. It's about the residents who fought gentrification even as their neighborhoods were auctioned off to the highest bidder. I'm Mariah Castaneda. This is episode six, The Hay Day. It didn't all start with WeSAD.

The FBI investigation is about a time in downtown Los Angeles when gentrification had reached a fever pitch. But by the time the FBI started investigating WeSAD, parts of downtown had been gentrifying for decades. Like the Arts District, which started as a part of Skid Row until artists started moving into lofts there in the 70s and 80s, like Nancy Uyemura. I mean, it was really amazing. I think the landlords wanted people to move into their buildings because a lot of the buildings in downtown area were just vacant. And so they'd rather have people in there.

And artists actually were really good tenants because they'd sort of fix up their own place. After being there for a couple years, Nancy started getting invited to these focus groups run by developers. They wanted to know what was attractive about loft living. They wanted to know why we were there, how long we were there, what the spaces looked like. They wanted rich folks to buy into the idea

of big open spaces with high ceilings and exposed pipes. At one point, off mic, Nancy described it like this. We didn't realize that we were handing them the knife to stab us in the back. They were basically asking us how to like make these spaces attractive and what would draw people in and how to create these little complexes that could make them a lot of money. And I thought afterwards, no, that was dumb. You know, that was dumb. We gave him all this information and we didn't really get anything out of it.

When Nancy first moved to the Arts District in the early 80s, there really wasn't developer interest in the neighborhood. Yet. And Nancy and her friends were doing exactly what they later told the developers and those focus groups. Taking these raw industrial loft spaces and sprucing them up. And actually, I was in that group that created that live-work space. So they got a designation from the city or the powers to be that we could live and work

in the same space and that it became legal because I think before that, a lot of the spaces were not legal. And Nancy said at the time, the neighborhood felt a little like the Wild West. Mostly artists, people that wanted big spaces for low rent. And so it was really fun. There were a lot of very creative people. So they were a little bit more open and crazy and fun to be around. It wasn't just Nancy and other artists.

Lots of people felt this way about downtown at the time. Persian Square. We used to have plays and all that stuff that was free. And anybody could go. That was the thing. Anybody could go. You didn't get shunned if you were homeless. This is Dwayne Mackey, who's lived and worked in and around Skid Row for about 30 years. He's spent some of that time unhoused. I mean, I used to take people to see ballet and stuff.

They never saw ballet before. Homeless people that would have never even been able to get into any of the playhouses around here, you know. We can't go to that unless we got a suit and tie on. And most of these guys don't have that. Because for all of the years, Skid Row and the Arts District was one place. You know what I mean? This is Pete White. He founded a grassroots organization in Skid Row called Los Angeles Community Action Network.

LACAN for short. It's a coalition of unhoused residents and advocates. Pete started organizing in Skid Row in 1992, about a decade after Nancy moved to the Arts District. There was still, you know, a lot of proper artists living in the Arts District, right? Living in the old warehouses. And when I say proper artists, many struggling artists, right? But the arts district had the facility or had the infrastructure. One, cheap rents. Two, large spaces. Eventually, Nancy moved into a building that was almost like an incubator for Japanese-American artists like her.

They were all living and working in the same space. At the time, a novel concept. It was pretty raw. Some places didn't have really good plumbing or heating or anything. Pete White again. There was starting to be a little transformation of the Arts District as downtown proper, where we're at, picked up. But for the most part, the Arts District was still okay. The speculation had not hit. But the speculation was about to hit. Nancy didn't realize it at the time, but everything she and other artists were doing, like fixing up the lofts,

they were all preparing the neighborhood to become a place hostile to someone like Dwayne, and eventually hostile to her too. Pete White watched all this happen from Skid Row. The first arm or the first sort of migrant population coming in are usually artists to make the community hip and cool. And these are usually your poor artists, right? Very innovative, but your poor artists. And they are also the very first wave of people who are going to be put out after they have quote unquote settled the land. And so while they were there, right, making it safe, hip and cool, that's when these other developments started cropping up.

And that wave of artists that I'm talking about now, some of which were friends of mine, they were priced out. They were priced out a decade ago. As the years went on from the 80s into the 90s and 2000s, the arts district transformed from the wild west that Dwayne and Nancy knew. It pushed further and further into Skid Row, and it became increasingly a place defined by money and police and private security. Most of Skid Row is gone.

And a lot of it's become like the Arts District now, right? Right. Yeah, all that was Skid Row, too. And it's all been taken over. You can't even walk down there. All of downtown became more hostile to unhoused people, but especially the Arts District. Duane says you can get the cops called on you for just walking around, and when you're unhoused, someone calling the cops on you can be dangerous, especially, of course, if you're unhoused and Black, like Duane. According to LAPD, a third of all the times an officer used force on someone in 2018, it involved a person who was unhoused, even though unhoused residents only made up about

1% of the population of Los Angeles. We're a little bit more than a block away from 800 Traction. That's where Nancy's building is. I went recently to walk around and record, and it didn't take me long to see what Dwayne meant about the security down there. But then there's a sign on the door. It says, attention, please do not touch or jiggle door. It will notify the alarm company, which notifies the police. Parentheses, LAPD. I'm like, dang, wow, okay. Walking around the Arts District is a trip. It doesn't feel like any other part of LA.

At least for me, it's a little eerie. Like it's missing something. And as we get closer to Traction, that's where a lot of trendy stuff is. There's a creation organic place that's like where more, like, a lot of trendy stuff is. There's a creation organic place that's with a K instead of a C. The vibe is interesting. There's like a high-end restaurant called Loki right here. It kind of feels like a college center, you know, what's supposed to be trendy and hip places for the students to hang out.

But they're kind of, you know, all like copy and paste kind of places. The day Nancy and I spoke, we sat outside talking for about an hour, and there was this thing I wanted to ask her the whole time, but I waited until the end. Okay, so in terms of gentrification, do you feel like you might have played a role in like maybe early gentrification of the arts district why or why not yes i think so we didn't know it at the time i mean people didn't label what we did as gentrifying an area and i don't think we even thought about it so it was interesting that that term all of a sudden came up and it was like oh well we were some of the victims of gentrification, but we actually helped with the gentrification of the neighborhood, you know? So what can I say?

Eventually, Nancy and other artists found themselves pushed out of the trendy neighborhood that they helped create. She and her neighbors were evicted from their loft building in the Arts District, 800 Traction Avenue, that building that had become kind of like an incubator for Japanese-American artists for decades. That was my first experience to actually see whitewashing because they wanted to erase the history of that building and to erase the history of the artists that were in that building. And so I was really amazed.

I mean, you know, and I thought, wow, I've been a little naive all these years. That kind of erasure doesn't just happen. It's deliberate. Big money has a way of forcing itself into a neighborhood and pushing out everything that came before. After the break, a luxury development in the Arts District, an executive determined to keep it unaffordable, and a council member who's ready and willing to help. So when I went to walk around the Arts District, I went to see the site of that luxury development

that Executive M was working on with WESAD, 520 Mateo Street. Yes, we are. So I'm heading over to 520 Mateo Street. It's like a construction site. It's surrounded by a chain link fence. Some of it's covered in tarp. Oh my God, it's a big ol' hole. Like a big ol' hole in the ground.

I would say it's about 1, 2, 3, 4, 5, 6. It's like 5 or 6 stories deep maybe. It's hard to say without having been there, but when I imagined Wisad and Executive M meeting for dinner and drinks, it probably felt like any old business conversation. Friendly. Wisad was willing to help Mateo Street get through city council, and Executive M was willing to pay what he had to to get it done.

Here's Scott Frazier. Jose Huizar is alleged to have sent people back and forth so that they could facilitate the payment of money either to himself or a proxy in order to secure his help, either denying appeals, which is a power that the Plum Committee has, or making sure that certain votes go forward on a certain time so that the companies can keep to their loan schedules. On August 18, 2016, in his office at City Hall, we saw and met with Executive M and the lobbyist Maury Goldman.

Goldman has since pled guilty to conspiracy to commit bribery and honest services mail fraud. And that basically means coordinating kickbacks and bribes that defrauded the general public. By the way, we contacted Goldman's lawyer with a request for comment, and he declined. So, Mateo Street was an ambitious project. It required a change to the city's zoning and its rules for what is allowed to be built where. And that kind of thing is pretty common for a big project like this. Here's my producer,

Carla, talking with Scott Frazier. Like, let's say I am a big money developer. I'm trying to get like this project through downtown. What are just like some of the things I need to go through? And at what point would I be like, okay, I need to go talk to Jose Huizar? Like, what are the things I would do? Yeah, if you want to either have a good laugh or if you would like to maybe drive yourself crazy, the city planning department and I think the Department of Building and Safety for the city of Los Angeles both have flow charts for the steps that you need to go through in order to permit a project like this. Think of development like a tall staircase. To actually build anything, there are a bunch of different steps you've got to climb. Step one, get approvals from different city departments. Step two, the Plum Committee can make changes to those approvals. Some changes make the developer really happy and others might piss them off and cost time and money. All the time you're climbing, but you're not sure if you're going to see the top

of the staircase, unless you've got someone to help you, like we said. So you do a years-long study, you go through a years-long potentially permits and approval process, and maybe a very long appeal period after that, not knowing what the eventual determination is going to be. So it's just money going out the door, and there's uncertainty about whether or not you will be able to build your project eventually. So Goldsman, the lobbyist, and Executive M ask Wissad to help get the skyscraper through this first step, the change of the city's rules about zoning. Wissad gets it done. And less than a month later, he comes back with the ask for Carmel Partners.

He wants money donated to a political action committee. Goldman emails Executive M the request and the PAC information. And let's just stop for a second to talk about the paper trail here. There's a lot of stuff like this in the indictment. It really seems like we thought he was never gonna get caught. Anyways, Executive M replies to Goldman's email. Timing and amount? Goldman writes back. 25K. As soon as possible. Okay, okay.

So this is the first donation in a series of donations from Executive M to PACs connected to WESOD. WESOD helps get the company's skyscraper through city council, and he gets a donation. Piece by piece, Wissad helps build the Mateo Street project. He goes to bat for the developer, and he doesn't seem to go to bat for anyone else, even the people he'd been talking to about the specific project. Well, I felt betrayed. You know, I worked with this guy for a decade and he had all the power. This is Tim Keating. He's an artist and longtime resident of the Arts District,

whose condo there is now worth more than $700,000, according to Zillow. Which, by the way, means he's been able to stay in the Arts District as people like Nancy were displaced. Keating's on the local neighborhood council. He's been involved in stay in the Arts District as people like Nancy were displaced. Keating's on the local neighborhood council. He's been involved in nonprofits in the Arts District, and he interacted with WESAD on and off for like 10 years. At the big 35-story building next to the 4th Street Bridge, I worked extensively with him on that for affordable artist housing, which he lied to my face consistently for.

The lie Keating is talking about is more like a bait and switch. for affordable artist housing, which he lied to my face consistently for. The lie Keating is talking about is more like a bait and switch. Here's what happened. The Mateo Street project got greenlit on the condition that 11% of the apartments would be reserved for very low-income households. Which was important because by this point, there was not a lot of affordable housing in the Arts District. The neighborhood Nancy Uyemura had moved into was almost completely transformed. Stories were coming out in the news with headlines like,

Should the Arts District still be called the Arts District when artists can't afford to live there? So, in January 2018, WESAD gets approached about changing how much affordable housing Mateo Street needed to have. Goldman, the lobbyist, asked if the city could approve the project with fewer affordable units. Like half of what Wiesad had promised Tim Keating. But he's not just asking for fewer units. He also wants slightly richer folks to be able to rent them. Keep in mind, Goldman is just a go-between. Executive M is the one who's really pushing this change. He's afraid his bosses at Carmel Partners

will cancel the project if WeSAD doesn't help push through these changes. He's also afraid he's gonna lose his job. WeSad and Goldman arranged to have dinner with Executive M to discuss it all at Officine Brera, that same Italian restaurant in the Arts District I mentioned earlier.

But even before they get to the restaurant, Wisad is asking what's in it for him if he helps get less affordable housing at Mateo Street. Will he get a donation

to Rochelle's political action committee? It's for... Rochelle Huizar's campaign. She was running for his seat, which he was termed out from on city council. So, Wiesad and Goldman are texting. This is Wiesad talking. Let's do the PAC stuff later this week. See you there at 6.

What's the purpose of tonight's meeting? Are they going to help with PAC? Goldman. Executive M wants to talk about their project and see if you're comfortable with the height and affordability levels. We sad. Are they going to help with PAC? Goldman.

I'm sure they will. However, as your friend, let's discuss this in a different text thread. Goldman is trying to help him out here, trying to tell Wisad not to text so brazenly. Because Wisad is basically laying out the scheme in a text. Executive M will help with the PAC if Wisad is comfortable coming through on Executive M's demands for the project. Wisad is comfortable. He makes sure that there's going to be less affordable housing and that the affordable housing would be for a higher income bracket

than initially planned. Tim Keating feels blindsided. He thought they were going to get what Weesad had originally promised. And, you know, he just said, oh, yeah, no, no problem, no problem. But then he went to the developer and said, you know, don't worry, you only have to do half of what we told these guys what you're going to do. It was a direct lie.

By the way, this wasn't the only time something like this had happened, that a promise of affordable housing passed through Ouissade's office and then just kind of evaporated into thin air. Pete White, the longtime organizer in Skid Row, said this happened to him too. There's a development going on on Wall Street and 7th. We met with the developer. So there was this development going up on the edge of Skid Row. The local nonprofit Pete White founded, L.A. Can, they initially opposed the development.

So the developer came to meet with them. The developer did his due diligence. Not many do. Really wanted the project to move. So he came. He came to create a park. Actual programming and sort of like ground level venues that they were going to have. They're going to have like theaters and auditoriums.

You know, we had this whole set of concessions from the developer. Developer was ready to go. And then the developer went to talk to Weezar. He came back to us and said, I don't know what's going on, but the council member does not want me to give any of this stuff. Weezar, the council member does not want me

to give any of this stuff, right? And we were like, what the, what the what, right? And so of course we ran up on Weezar, but Weezar straight up derailed the whole thing. Pete says the developer was willing to give concessions to the community. The proposal went to Weezar's office and then all of a sudden the concessions evaporated. Of course, the developer did not go against Wezar, right? Because he still needs Wezar, but you know, in development language, it's like, it doesn't pencil. Well, this developer made

it pencil. He made the project pencil with all of the things that we felt, with many of the things that we felt was fair and equitable for the community. And Wezar came in, said, screw that, you ain't doing that. And the guy walked out. Pete's saying that Wisad's office was actively standing in the way, even when developers themselves wanted to make concessions. And so when his indictment came down, and as part of the indictment, we heard similar stories of him going to the developers saying, don't worry about affordable housing.

I got you. You know, we were like, aha. Back to Mateo Street. Over the next 10 months, WESAD solicits $100,000 for Rochelle's PAC. In September 2018, Rochelle officially announces her candidacy to represent CD14. This is the campaign that's going to be funded by those PAC donations. And we saw an Executive M have that meeting at Office de Imbrera, where Executive M offers to dig up dirt on his young female staffer.

They discuss the donations Executive M agreed to make to Rochelle's PAC. Here's what's weird. Carmel Partners has been making these donations because we sad-sledgedly done stuff for them. That's not legal. But what is legal is for the city to request that a developer make donations to different charities or city funds to get a development built. The logic is developers are getting to build these huge projects they're going to make a whole lot of money on. They've got to give something back. So, for Carmel Partners to get a 520 Mateo Street built, they were going to have to donate $2.25 million for affordable housing in Wisad's district.

Again, legally. But when Wisad looked at that money, he saw an opportunity. At that fundraiser in October 2018, when Executive M gave Wiesad the dirt on his staffer, Wiesad allegedly made a proposal. If he can get the donation to the Affordable Housing Fund reduced, would Carmel Partners give $250,000 directly to him? This part would be totally illegal. It's also a bit of a shameless request.

Take this money away from affordable housing for my constituents and give it directly to me. Lots of people were livid when they found out. Like Zuma Dog, that city council watchdog. He cloaks himself, and I'm here to represent those people. And look what he's doing. He's taking bribes for some guy to build a Chinese skyscraper nobody can afford to live in at the expense of real community services. You know, so it's all just a joke.

What a fucking joke this guy is. By the way, not all skyscraper developers in this story are Chinese. Although some of them are. But whether he meant to or not, ZumaDog is evoking an ugly trope about foreigners. Specifically Chinese developers coming in and reshaping America. Okay, we just proposed that Carmel Partners give that $250,000 directly to him. Executive M does not respond, just like Wissad, who also didn't respond when we sent him and his lawyers more than 40 questions, including many of the allegations in this episode. Then, two things happen.

After the fundraiser, Wissad requests two more opposition research reports. Executive M Googles the names, figures out they work for Wissad, and doesn't answer. He never does the background checks. He's kind of ghosting Wissad. By the way, Carmel Partners admitted both these things to the government.

And this, too. Around that same time, Wissad asks Executive M about potentially working at Carmel Partners once he terms out a city council. Executive M does not give a definitive response. On Halloween 2018, Executive M writes an email to his colleagues at Carmel Partners. We saw it has pushed the Mateo Street development through two votes, one in the Plum Committee and one with the full City Council. Here's what it says according to the indictment. Great news. We just received final unanimous approval for Project M by City Council. Although today is a bit of a formality, plum is where the discretion usually happens.

This is the final step. He goes on. Our obligations related to rent, affordable housing, restrictions, and union involvement are minimal compared to other future projects in the area. And then Executive M says that he's so proud of building such a tall building in, quote, a wealthy, opinionated hipster community. One week later, the FBI closes in. Next time on The Sellout,

a sexual harassment lawsuit that could have ended Huizad's career. And how an associate made it all go away. The Sellout is produced by Neon Hub Media and LA Taco. I'm your host, Mariah Castaneda. My co-reporters are Alexis Olivier-Ray and Carla Green. Carla Green is our lead producer and she wrote the episodes. Our editor is Catherine St. Louis. Vikram Patel is our consulting editor. Associate editor is Stephanie Serrano. Associate producer is Liz Sanchez. Our executive producer is Jonathan Hirsch.

Samantha Allison is our production manager. Fact checker is Sarah Ivry. Our sound designer is Hansdale Sue. Eduardo Arenas made our theme music. Other original music by Moni Mendoza. Any additional tracks you hear on this episode are from Blue Dot Sessions. Thanks to our voice actors, Memo Torres, Jorge La Bastida, Jod Caftan, Chad Addy, and Woodrow Curry. Special thanks to Eric Galindo, Javier Cabral, Tanner Robbins, Haley Fager, Natalie Wren, Adrienne Riskin, Janet Villafana,

Vanessa and Jorge Castaneda, and Ivan Fernandez. If you want to know more about what you've heard on the show so far, head over to LATaco.com to see a beautiful map of some of the places we talk about, made by Tommy Gallegos, as well as new reporting and interviews. Before we go, I just wanted to say thank you for listening to The Sellout. We hope you're loving the show as much as we love making it. And we really want to hear sellout. We hope you're loving the show as much as we love making it. And we really want to hear from you. Your feedback goes a long way and it only takes a few minutes. Just head to smokescreen.fans to answer a few questions. We're so excited to hear from you. I'm so excited to hear from you. Thanks for listening. See you next week.