Two Detroit businessmen acted as FBI informants and secretly recorded San Francisco Public Works Director Mohammed Nuru and restaurateur Nick Bovis, helping the government build a sweeping public corruption case that jolted City Hall last week, The Chronicle has learned.
Under the threat of a pending federal investigation, Samir Mashni and Noureddine “Dean” Hachem began cooperating with the FBI and recorded phone calls and in-person meetings with Bovis and Nuru for months beginning in January 2018, according to a federal complaint and sources with knowledge of the investigation.
The probe led to fraud charges against Bovis and Nuru while revealing at least five alleged schemes, including the centerpiece of the government’s case: an alleged plot to bribe an airport commissioner.
The Chronicle used an FBI affidavit and confirmed the identity of the informants with sources to piece together new information in the wide-ranging case that has prompted additional investigations and calls to reform city government. The sources spoke on the condition of anonymity, which The Chronicle granted in accordance with its anonymous sources policy.
The revelations offer a window into how federal agents investigate public corruption over months or sometimes years, flipping informants in their pursuit of bigger targets.
“You try to develop sources and some of them are not just sources — they are targets,” said Rick Smith, a retired FBI special agent who runs a private investigation firm and is not involved in the case. “You turn those people to provide more information on people higher up in the chain. If you have people that are wired and confidential sources, that’s a bad combination for a defendant.”
Mashni and Hachem operate Midfield Concession Enterprise Inc., an airport concession business that, according to its website, has 34 locations in seven airports around the country, including Roasting Plant Coffee at San Francisco International Airport. It’s unclear why Mashni and Hachem are being investigated. Messages to Roasting Plant Coffee’s headquarters in New York were not returned.
While the complaint doesn’t name the men and their business, the FBI affidavit describes two “confidential human sources” who made the recordings and worked with an undercover agent to document the alleged schemes. One of the sources “was previously arrested and charged with conspiracy to transport and sell stolen motor vehicles, receipt of a stolen motor vehicle, and trafficking in a motor vehicle with altered identification number,” FBI Special Agent James Folger wrote in the affidavit.
Federal court records show Hachem was indicted in Michigan in 2001 and was later convicted on the same charges. Mashni has no criminal record and is a licensed attorney in Michigan.
The confidential human sources described by the FBI had previously worked with Bovis, who owns Lefty O’Doul’s, in a failed attempt to open a restaurant inside the airport, according to the affidavit. One man did not disclose an incident involving a prior bribe to a public official before he began working with the FBI, according to the affidavit.
The men are not charged with any crimes in the San Francisco case. The FBI said it could not comment on anyone who is not charged in the case. Mashni and Hachem did not return numerous messages and requests for comment.
The FBI may have also been trying to flip Nuru when agents arrested him on Jan. 21 and told him to keep quiet about the case that was still under seal at the time. Nuru, however, allegedly told City Administrator Naomi Kelly, his boss, about the investigation and was arrested again on Jan. 28 and hit with an additional charge of lying to the FBI.
It’s not clear if federal agents had their sights on anyone else in their investigation.
Nuru is also accused of accepting gifts from a billionaire Chinese developer and receiving free and discounted work on his Colusa County vacation home. He and Bovis face 20 years in prison if convicted.
Bovis’ attorneys, Mike Stepanian and Gil Eisenberg, said they could not comment on pending litigation.
“Nick Bovis is a very nice guy, a family guy, who has done a lot for our city through the years,” Stepanian said.
Nuru’s attorney, Ismail Ramsey, said his client “welcomes and looks forward to addressing the government’s allegations in court.”
The defendants are due back in court on Thursday for a bond hearing.
While the federal charges continue to reverberate around San Francisco, and the FBI moves forward with its investigation, including raiding the office of building permit consultant Walter Wong last week, the origins of the case were more low-key.
The investigation began to intensify on Jan. 24, 2018, during an outreach meeting for a food and beverage concession lease in Terminal 1 at San Francisco International Airport. Bovis and the two confidential sources, identified to The Chronicle as Mashni and Hachem, who were already cooperating with the FBI, left the airport and went to Bovis’ restaurant, Broadway Grill, in Burlingame, according to the affidavit.
The FBI’s sources were recording as the men discussed submitting a proposal to get Bovis’ restaurant, the Spinnerie, into lease No. 5 that was reserved for a “chicken quick serve restaurant,” according to the complaint.
Bovis brought up Nuru as one of his “resources in San Francisco city government” who works “side deals” that could potentially help them secure the lease, the FBI said. Bovis described a previous failed restaurant bid by the three men in which he tried to get the late mayor Ed Lee involved, saying “I thought I did everything right but I don’t know what happened,” according to the affidavit.
In the weeks that followed, one of the FBI’s sources recorded conversations with Bovis, including a discussion about how Nuru helped set up a meeting with an airport commissioner, later revealed to be Linda Crayton, to help “make it happen,” the FBI wrote.
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Crayton resigned a day after the charges were unsealed last week, citing a struggle with “multiple, severe medical conditions for several years.”
During one conversation, Bovis brought up the idea of giving Crayton “$5,000 bucks cash” along with paying for a trip to the city where the businessmen were based to “take a quick airport tour” to see their operations, Folger wrote.
The plot came to a head on April 4, 2018, when the men identified as Mashni and Hachem, with Bovis, Nuru, Crayton and an undercover FBI agent, posing as a representative for potential investors, met for dinner at Broadway Grill.
The group discussed their previous failed attempts to get into the airport and prepared to hand Crayton an envelope with $5,000 cash, but Nuru at the last second canceled the plan, according to the affidavit. There’s no indication Crayton was ever aware of an alleged plot to bribe her.
“Man, you make me carry $5,000 in my pocket for nothing,” the FBI’s source allegedly said.
“Man, I did you a favor,” Nuru allegedly responded. “I’ll have Nick put it in a safe for you.”
In the days after the meeting, Bovis’ other business partners, who were apparently not working for the FBI, began looking into the undercover agent over concerns about his investors. They hired San Francisco private investigator Jack Immendorf, who ran a background check on the agent, which raised concerns.
“He’s a ghost,” Bovis was recorded saying, according to the affidavit. “There’s no, he just has a recently new number, a new domain name, a new email. Just created in March. So it’s sort of hard to, we’re going to waste our time if we go before the airport with him as our finance.”
Three months later, on July 10, 2018, the Airport Commission awarded the contract to a different company, Tastes on the Fly, which licensed local company Starbird, for Lease No. 5.
Evan Sernoffsky is a San Francisco Chronicle staff writer. Email: firstname.lastname@example.org Twitter: @EvanSernoffsky