Connect with us

Business

Detroit business partners acted as FBI informants in Nuru corruption investigation

Published

on

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.”

Customers wait for their coffee at the Roasting Plant Coffee shop at San Francisco International Airport. Two owners of Midfield Concession Enterprise Inc., an airport concession business that has 34 locations, including Roasting Plant Coffee at San Francisco International Airport, were confidential informants for the FBI.

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.

Inside the newsroom

Anonymous sources:The Chronicle strives to attribute all information we report to credible, reliable, identifiable sources. Presenting information from an anonymous source occurs extremely rarely, and only when that information is considered crucially important and all other on-the-record options have been exhausted. In such cases, The Chronicle has complete knowledge of the unnamed person’s identity and of how that person is in position to know the information. The Chronicle’s detailed policy governing the use of such sources, including the use of pseudonyms, is available on sfchronicle.com.

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: esernoffsky@sfchronicle.com Twitter: @EvanSernoffsky



Source link

Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Business

COVID-19: Ottawa small businesses see revenue dry up

Published

on

By

Ottawa jewelry maker Alyssa Spaxman kids that she’s doing a lot of deep breathing these days.

After all, she needs a means of calming herself, given COVID-19 and the massive hit her business, Strut Jewelry, has taken.

“Carrying the anxiety and fear of losing my income, along with concerns for the health of my friends, family and myself … has been completely draining,” Spaxman says.

The financial impact of the pandemic has been “immeasurable,” says Spaxman, who launched her business in 2009 and has two part-time employees working with her in her studio.

She finds herself in a plight common to many small businesses and product makers who have wares to sell but practically no way now to sell them.

The income streams that Spaxman built up over the years “have all toppled in one week,” she says.

“Events are cancelled, stores that carry my work are all closed. I am down to a trickle of online sales,” says Spaxman.

Many shows and markets Spaxman normally attended — such as the Ottawa Farmers’ Market at Lansdowne Park, which has suspended operations — have been cancelled.

As for the future, Spaxman worries that some shops that stock her work may go out of business or have to scale back their operations, affecting her sales. Furthermore, she fears that “people are losing their jobs and the capacity to spend on non-essential goods like mine.

“The negative effects on my livelihood are direct, far-reaching and will be felt for a very long time,” she says.

Spaxman is doing her best to adapt to the new COVID-19 normal, promoting sales through her website, offering discounted gift cards, pick-ups from her porch and free shipping for orders of more than $100.

But she says: “I don’t want to overwhelm my customers, as so many of them are overwhelmed themselves and grappling with this new reality we are all faced with.

“I’m hoping that our government will offer something to help,” Spaxman said in an interview Thursday.

On Friday, in an effort to help small- and medium-sized businesses stay afloat, Prime Minister Justin Trudeau announced the federal government will cover 75 per cent of wages for qualifying small- and medium-sized businesses, backdated to March 15.

 STAY INFORMED: CLICK HERE TO SUBSCRIBE TO OUR NEW DAILY COVID-19 NEWSLETTER FOR ALL THE LATEST UPDATES

Source link

Continue Reading

Business

French Laundry restaurateur Thomas Keller sues for coronavirus insurance coverage

Published

on

By

Keller’s attorney says the suit against insurer Hartford Fire Insurance Company — and other similar challenges filed by restaurant owners — is intended to establish legal precedent so that businesses facing mandated coronavirus closures are covered by their business interruption insurance policies.

Matthew Sturdevant, a spokesperson for The Hartford, declined to comment on the lawsuit. The suit was brought by French Laundry Partners, LP and Keller’s restaurant group.

Keller is one of America’s most-decorated chefs, and his restaurants have received numerous awards and accolades. He’s the first American-born chef with two restaurants simultaneously achieving three-star ratings from the Michelin Guide.

Keller’s group has about a dozen restaurants in New York, Las Vegas, Miami and Yountville, Calif.

His is not the only challenge by a restaurant regarding coronavirus-related insurance coverage. New Orleans seafood restaurant Oceana Grill made a similar move earlier this month in asking a Louisiana court to make a declaratory judgment that its insurance policy with Lloyd’s of London covers civil authority-ordered closures.
Chef Thomas Keller

The American Property Casualty Insurance Association this week said it believes that most insurance policies — including those with business interruption coverage — do not cover viruses such as Covid-19 and that to “retroactively rewrite existing insurance policies” could put the insurance industry at risk.

One estimate by the association found that small business’ potential continuity losses could total $220 billion to $383 billion per month, which would quickly consume the estimated $800 billion surplus US insurers have for payouts.

“If policymakers force insurers to pay for losses that are not covered under existing insurance policies, the stability of the sector could be impacted and that could affect the ability of consumers to address everyday risks that are covered by the property casualty industry,” David A. Sampson, president and CEO of the association, said in a statement.

John Houghtaling, the attorney representing both Keller and Oceana Grill, told CNN Business that “It’s become clear the insurance companies were not going to honor these policies.”

Houghtaling, managing partner of Gauthier, Houghtaling LLP, referenced a posting made earlier this month by a catastrophe litigation attorney with Zelle LLP, a boutique law firm that focuses on insurance-related matters. The attorney wrote that unless policies specifically outline non-physical damage coverage, businesses “are unlikely to find relief within the four corners of their policies.”

Houghtaling disagreed with the assessment.

“They’re wrongfully denying us, which is going to cripple millions of people and their livelihoods,” he said.

Source link

Continue Reading

Business

Feds increase wage help for business amid COVID-19 pandemic | paNOW | Prince Albert, Saskatchewan

Published

on

By

(The Canadian Press)

By Glenn Hicks

Wage Help

Mar 27, 2020

The Prince Albert and District Chamber of Commerce is applauding the latest federal government move to keep businesses afloat amid the COVID-19 pandemic.

Ottawa will now offer a 75 per cent wage subsidy to qualifying small and medium-sized enterprises (SMEs) who have been affected by the pandemic. Previously it had announced a 10 per cent wage subsidy. It is backdated to March 15. Also, an emergency account will offer loans up to $40,000 interest free for one year, $10,000 of which may be forgivable to qualifying businesses.

“Anybody who still has employees who are working, I would imagine this will come as a relief,” CEO of the local chamber Elise Hildebrandt told paNOW. But she added the details of the package were still scarce, including which businesses would qualify. She was hoping to get an update soon from federal officials and post the details to the chamber website.

Hildebrandt said the $40,000 loans would be a benefit for local firms.



Source link

Continue Reading

Trending