UNITED STATES OF AMERICA, Plaintiff, v. TED MORENO, TONY ESPINOZA, HECTOR OLIVARES, and ROMAN PALACIOS, Defendants.
NO. SA CR _______________
I N D I C T M E N T
[18 U.S.C. § 1951: Conspiracy to Interfere with Commerce by Extortion; 18 U.S.C. § 1951: Attempted Interference with Commerce by Extortion; 18 U.S.C. §§ 1341, 1346: Honest Services Mail Fraud; 18 U.S.C. § 1956(h): Money Laundering Conspiracy; 18 U.S.C. § 1956(a)(1); Money Laundering; 18 U.S.C. § 2: Aiding and Abetting]
The Grand Jury charges:
COUNT ONE
[18 U.S.C. § 1951]
A. INTRODUCTION
At all times relevant to this indictment:
1. The City of Santa Ana was an incorporated city in Orange County, within the Central District of California. Pursuant to the Santa Ana City Charter, the City is governed by a City Council consisting of seven Councilmembers, including one Mayor. With the exception of the Mayor, the Councilmembers are elected from separate geographical districts, or "wards," within the City of Santa Ana.
2. Defendants TED MORENO and TONY ESPINOZA were elected members of the City Council of the City of Santa Ana.
3. Defendant TED MORENO was a candidate for re-election to the Santa Ana City Council in November 1996.
4. Defendants HECTOR OLIVARES and ROMAN PALACIOS were candidates for election from separate council wards to the Santa Ana City Council in November 1996.
5. Pursuant to the Santa Ana Municipal Code, persons seeking to use a parcel of real property located in the City of Santa Ana for the sale of alcoholic beverages were required to obtain a "conditional use permit" authorizing the use of the subject property for the sale of alcoholic beverages. The Santa Ana Municipal Code and the Santa Ana City Charter provide that the Santa Ana Planning Commission, an appointed commission of seven qualified electors from the City, shall receive, consider, and approve or disapprove all applications for conditional use permits. In the case of a conditional use permit for the sale of alcoholic beverages, the City Council may review -- and thereafter approve or disapprove -- the decision of the Planning Commission only by the Council's own initiative. Otherwise, the decision of the Planning Commission is final, and no party may appeal.
6. From in or about April 1996 through April 1997, an owner of a gas station in the City of Santa Ana (hereinafter "Santa Ana business owner") sought to sell alcoholic beverages from a store located on the premises of this gas station. In order to sell alcoholic beverages, a conditional use permit was required (hereinafter "the Permit").
B. OBJECT OF THE CONSPIRACY
1. Beginning in or about April 1996 and continuing to in or about November 1996, in Orange County, within the Central District of California, defendants TED MORENO, TONY ESPINOZA, HECTOR OLIVARES and ROMAN PALACIOS knowingly and willfully conspired and agreed with each other to commit an offense against the United States, namely, to obstruct, delay, and affect commerce by extortion, under color of official right, in violation of Title 18 United States Code, Section 1951.
2. The plan and purpose of this conspiracy was for defendants TED MORENO, TONY ESPINOZA, HECTOR OLIVARES and ROMAN PALACIOS to extort campaign contributions from the Santa Ana business owner in exchange for their collective official support for the Permit as anticipated Santa Ana City Councilmembers after the election in November 1996.
C. MEANS BY WHICH THE OBJECT OF THE CONSPIRACY WAS TO BE ACCOMPLISHED
The objects of the conspiracy were to be accomplished in substance as follows:
1. Defendants TED MORENO, TONY ESPINOZA, HECTOR OLIVARES and ROMAN PALACIOS represented to the Santa Ana business owner that if defendants TED MORENO, HECTOR OLIVARES, and ROMAN PALACIOS were successful in their November 1996 election campaigns ("the three election campaigns"), they would collectively constitute an effective majority voting block of four on the Santa Ana City Council.
2. Defendants TED MORENO, TONY ESPINOZA, HECTOR OLIVARES and ROMAN PALACIOS promised their official support for the Permit after the November 1996 election in exchange for approximately $31,000 in campaign contributions to the three election campaigns.
3. At various times, defendant TED MORENO collected cash and checks from the Santa Ana business owner as installment payments for the total contribution amount of approximately $31,000.
D. OVERT ACTS
In furtherance of the conspiracy and to accomplish the object of the conspiracy, defendants TED MORENO, TONY ESPINOZA, HECTOR OLIVARES and ROMAN PALACIOS committed various overt acts in Orange County, within the Central District of California, including but not limited to the following:
1. In or about April 1996, in Santa Ana, California, defendant TED MORENO advised the Santa Ana business owner that he, defendant TONY ESPINOZA and two other candidates for the Santa Ana City Council were interested in meeting with him to discuss their possible official support for the Permit.
2. On or about May 20, 1996, defendants TED MORENO, TONY ESPINOZA, HECTOR OLIVARES and ROMAN PALACIOS met with the Santa Ana business owner at a restaurant in Santa Ana, California, and offered to provide their collective official support for the Permit in exchange for approximately $31,000 in contributions to the three election campaigns.
3. On or about June 1, 1996, in Santa Ana, California, defendant TED MORENO collected from the Santa Ana business owner three checks each in the amount of $1000 payable to "HECTOR OLIVARES for City Council" and two checks each in the amount of $1000 payable to "ROMAN PALACIOS for City Council."
4. On or about June 12, 1996, in Santa Ana, California, defendant TED MORENO instructed the Santa Ana business owner to prepare four separate checks from four separate bank accounts, each in the amount of $249 to "MORENO for City Council."
5. On or about June 28, 1996, in Santa Ana, California, defendant TED MORENO collected from the Santa Ana business owner two checks each in the amount of $1000 payable to "HECTOR OLIVARES for City Council" and three checks each in the amount of $1000 payable to "ROMAN PALACIOS for City Council."
6. On or about July 20, 1996, in Santa Ana, California, defendant TED MORENO collected $5,000 in currency from the Santa Ana business owner.
7. On or about September 3, 1996, in Santa Ana, California, defendant TED MORENO collected $2,500 in currency from the Santa Ana business owner.
8. On or about September 10, 1996, in Santa Ana, California, defendant TED MORENO collected $2,500 in currency from the Santa Ana business owner.
9. On or about October 9, 1996, in Santa Ana, California, defendant TED MORENO collected $2,500 in currency from the Santa Ana business owner.
10. On or about October 19, 1996, in Santa Ana, California, defendant TED MORENO collected $2,000 in currency from the Santa Ana business owner.
11. On or about November 1, 1996, in Santa Ana, California, defendant TED MORENO collected $1,500 in currency from the Santa Ana business owner.
COUNT TWO
[18 U.S.C. § 1951]
A. INTRODUCTION
At all times relevant to this indictment:
1. Paragraphs 1 through 4 of the Introduction to Count 1 are re-alleged and incorporated by reference as though set forth in full.
2. The Santa Ana Municipal Code and the Santa Ana City Charter provide that the Santa Ana Planning Commission shall receive and consider all applications for proposed zoning changes, and then recommend a decision to the Santa Ana City Council; the Santa Ana City Council shall hold a final hearing on all proposed zoning changes; and no zoning change shall be finally approved except by adoption of an ordinance by the Santa Ana City Council.
3. In or about 1996, the director of an organization in the City of Santa Ana (hereinafter "Santa Ana landowner") desired to sell a parcel of land located in Santa Ana (hereinafter "Santa Ana land") on behalf of that organization. The Santa Ana land had been zoned as "A-1," which meant that it was zoned for primarily agricultural use.
4. The Santa Ana landowner preferred to sell the land in one of two ways. The first involved a sale of the Santa Ana land to the School Board of the Santa Ana Unified School District (hereinafter "the Santa Ana School Board"). The second involved the rezoning of the Santa Ana land for residential use with housing lots no larger than 4000 square feet (hereinafter "R1-4000"). Zoning as R1-4000 would permit the Santa Ana landowner to sell the land to a developer, who, in turn, could develop the land into a residential community with higher density housing.
5. By in or about May 1996, the Planning Commission had communicated to the Santa Ana landowner that it would permit a rezoning of the Santa Ana land for residential lots no smaller than Santa Ana’s normal residential zoning requirement of 6000 square feet per housing lot (hereinafter "conventional R1 zoning"). Conventional R1 zoning would permit the development of significantly fewer residences on the Santa Ana land. The Santa Ana landowner believed that he could obtain a significantly higher bid for the Santa Ana land with R1-4000 zoning rather than with conventional R1 zoning.
B. ATTEMPTED INTERFERENCE WITH COMMERCE BY EXTORTION
6. Beginning in or about May 1996 and continuing through in or about July 1996, defendant TED MORENO attempted to affect commerce by extortion in that defendant TED MORENO, acting under color of official right, promised that he would cause a member of the Santa Ana School Board to vote for the purchase of the Santa Ana land, and that if the Santa Ana School Board did not purchase the Santa Ana land, he and three other councilmembers would officially support the R1-4000 proposal after the November 1996 election.
7. In exchange for these two promises, defendant TED MORENO demanded $15,000 in contributions to his election campaign, and the election campaigns of Olivares and Palacios, and later collected approximately $5,320 in gold Krugerrand coins and $4,500 in cash payments from the Santa Ana landowner, with his consent, in violation of Title 18, United States Code, Section 1951.
COUNTS THREE THROUGH ELEVEN
[18 U.S.C. §§ 1341 and 1346]
At all times relevant to this indictment:
A. INTRODUCTION
1. Paragraphs 1 through 6 of the Introduction to Count 1, and paragraphs 2 through 5 of the Introduction to Count 2 are re-alleged and incorporated by reference as though set forth in full.
2. After each election, at the start of a new four-year term, each newly-elected or re-elected member of the Santa Ana City Council took an oath to support and defend the Constitutions of the United States and the State of California, and to well and faithfully discharge his duties.
B. THE DUTY OF HONEST SERVICES
3. Members of the Santa Ana City Council owed a duty of honest services to the City of Santa Ana and its citizens. This duty of honest services included an obligation to perform their jobs as members of the Santa Ana City Council impartially and free from bribery, deceit, fraud, and dishonesty. This duty of honest services also required councilmembers to abide by their oaths of office, the laws of the United States, the laws of the State of California, and the laws of the City of Santa Ana, including those summarized in paragraphs 4 through 15 below.
Bribery
4. It was a violation of Section 165 of the California Penal Code for a Santa Ana City Councilmember, such as defendant TED MORENO, to receive, offer to receive, or agree to receive a bribe.
5. Section 7 of the California Penal Code defined the word "bribe" as used in the California Penal Code to mean anything of value or advantage, present or prospective, or any promise or undertaking to give anything of value, which was asked for, given, or accepted with a corrupt intent to influence, unlawfully, the person to whom it was given, in his or her action, vote, or opinion, in any public or official capacity.
Laws Limiting Amount of Campaign Contributions
6. It was a violation of Section 84300 of the California Government Code for a person seeking election to the Santa Ana City Council, such as defendant TED MORENO, to receive more than $100 cash from any individual.
7. It was a violation of Section 85301 of the California Government Code for a person seeking election to the Santa Ana City Council, such as defendant TED MORENO, to solicit or accept any contribution or loan which would cause the total amount contributed or loaned by that person to that candidate to exceed $1000.
Disqualification Due to Campaign Contributions
8. It was a violation of Section 425 of the Santa Ana City Charter for any councilmember, such as defendant TED MORENO, to participate in, or use his official position to influence, a decision of the city council if it was reasonably foreseeable that the decision would have a material financial effect, distinguishable from its effect on the public generally, on a recent major campaign contributor. A "recent major campaign contributor" was defined by Section 425 as a person who had made campaign contributions totaling $250 or more to the councilmember in the twelve-month period immediately preceding the date of the decision.
Reporting Requirements
9. California Government Code Sections 84211 and 84300, et seq., required the disclosure of accurate information regarding receipts and expenditures in election campaigns.
10. Each six-month period, councilmembers were required by law to file a Campaign Statement for the previous six-month period.
11. Councilmembers were required to include in their Campaign Statements the total amount of contributions received during the period covered by the Campaign Statement and the total cumulative amount of contributions received.
12. Councilmembers were also required to include in the Campaign Statements the total amount of contributions received from persons who had given a cumulative amount of $100 or more.
13. Councilmembers were also required to include in the Campaign Statements the following information about each person who contributed a cumulative amount of $100 or more: (1) his or her full name, (2) his or her street address, (3) his or her occupation, (4) the name or his or her employer, or if self-employed, the name of the business, (5) the date and amount received for each contribution, and (6) the cumulative amount of the contributions.
14. Campaign Statements were public and could be reviewed by members of the news media, political opponents of the public official who filed the statements, and anyone else seeking truthful and honest information about the relationship between public officials and contributors, and the nature and extent of contributions received by those officials.
Perjury
15. According to Section 118 and Section 129 of the California Penal Code, anyone who knowingly made a false statement in a Campaign Statement committed perjury.
C. THE MAIL FRAUD SCHEME
16. Beginning in or about April 1996 and continuing through at least April 1997, in Orange County, within the Central District of California, defendant TED MORENO, and others known and unknown to the Grand Jury, devised, intended to devise and knowingly participated in a scheme and artifice to defraud. The objects of this scheme and artifice to defraud were as follows:
a. To defraud the City of Santa Ana and its citizens of their right to have the business and affairs of the municipal government of Santa Ana conducted honestly and impartially, free from bias, fraud and deceit;
b. To defraud the City of Santa Ana and its citizens of their right to the loyal, faithful and impartial services, actions, decisions and performance of duties by defendant TED MORENO free from bias, fraud and deceit;
c. To defraud the City of Santa Ana and its citizens of their right to be informed of all relevant facts and circumstances concerning sources of influence on defendant TED MORENO in the performance of his official duties;
d. To defraud the City of Santa Ana and its citizens of their right to be informed of all relevant facts and circumstances concerning contributions, receipts and expenditures in election campaigns in the City of Santa Ana.
17. The scheme to defraud included, but was not limited to, the following:
a. Santa Ana Business Owner
(1) In or about April 1996, while serving as an elected public official in the City of Santa Ana, defendant TED MORENO solicited $31,000 in contributions from the Santa Ana business owner for his own reelection as well as for the election of others to the Santa Ana City Council;
(2) In exchange for approximately $31,000 in campaign contributions from the Santa Ana business owner, defendant TED MORENO agreed to support the Permit, to deliver the vote of another councilmember, and to use the contributions in part to facilitate the election of two other candidates to the City Council who would support the Permit;
(3) In the course of his efforts to collect the $31,000 in campaign contributions, defendant TED MORENO met with the Santa Ana business owner and instructed him to write $996 in checks payable to his own campaign account and $10,000 in checks payable to the campaign accounts of two council candidates. In addition, defendant TED MORENO collected $16,000 in cash payments from the Santa Ana business owner from on or about July 20, 1996, through on or about November 1, 1996.
(4) As part of the scheme to defraud, defendant TED MORENO concealed and failed to disclose the $16,000 in cash payments extorted from the Santa Ana business owner. Defendant TED MORENO concealed these cash payments at least in part by recruiting persons both known and unknown to the grand jury who were willing to accept cash in exchange for providing checks designated as either campaign "contributions" or campaign "loans."
(5) As a further part of the scheme to defraud, defendant TED MORENO concealed the nature and extent of the Santa Ana business owner's contributions by instructing this owner to write contribution checks so that the checks written to his own campaign and two others appeared to derive from multiple and legal sources.
(6) As a further part of the scheme to defraud, defendant TED MORENO knowingly filed and caused to be filed false Campaign Statements which stated under oath that he had received only $249 in monetary contributions from the Santa Ana business owner, when in fact he had received $16,000 in cash and an additional $747 in contributions by check from the Santa Ana business owner.
(7) As a further part of the scheme to defraud, defendant TED MORENO voted to approve the Permit on April 21, 1997.
b. Santa Ana Landowner
(1) In or about May 1996, while serving as an elected public official in the City of Santa Ana, defendant TED MORENO solicited $15,000 in contributions from the Santa Ana landowner for his own reelection as well as for the election of two others to the Santa Ana City Council;
(2) In exchange for approximately $15,000 in campaign contributions from the Santa Ana landowner, defendant TED MORENO agreed (a) to cause the Santa Ana School Board to purchase the Santa Ana property by delivering the vote of a key member of the Santa Ana School Board; and, if the Santa Ana School Board failed to purchase the Santa Ana land, (b) to deliver his own vote and the vote of another councilmember, and to use the contributions in part to facilitate the election of two other candidates to the City Council who would support the R1-4000 proposal.
(3) In the course of his efforts to collect the $15,000 in campaign contributions, defendant TED MORENO collected 14 gold Krugerrand coins and $4500 in cash payments from the Santa Ana landowner from in or about May 1996 through in or about July 1996.
(4) On or about June 5, 1996, defendant TED MORENO caused the conversion of fourteen one-ounce gold Krugerrand coins collected from the Santa Ana landowner into approximately $5,320 in cash.
(5) As part of the scheme to defraud, defendant TED MORENO concealed and failed to disclose the $4,500 in cash payments extorted from the Santa Ana landowner. Defendant TED MORENO concealed these cash payments at least in part by recruiting persons both known and unknown to the grand jury who were willing to accept cash in exchange for providing checks designated as either campaign "contributions" or campaign "loans."
(6) As a further part of the scheme to defraud, defendant TED MORENO knowingly filed and caused to be filed false Campaign Statements which failed to disclose that he had received any monetary contributions from the Santa Ana landowner, when in fact he had received approximately $4,500 in cash payments from the Santa Ana landowner.
(7) As a further part of the scheme to defraud, defendant TED MORENO knowingly filed and caused to be filed false Campaign Statements which failed to disclose that he received approximately 14 gold Krugerrand coins from the Santa Ana landowner.
D. MAILINGS
18. On or about the dates listed below, within the Central District of California, defendant TED MORENO, for the purpose of executing the scheme and artifice to defraud, and attempting to do so, knowingly and willfully caused the following mail matter to be sent and delivered by the United States Postal Service according to the directions thereon.
|
COUNT |
DATE |
MAIL MATTER |
RECIPIENT |
|
3 |
August 23, 1996 |
Ted Moreno Reply Card |
Carol Leu,
933 West Alpine Ave., Santa Ana, CA |
|
4 |
October 1, 1996 |
Ted Moreno, A Family Man with Family Values Campaign Mailer |
Betty Sanders,
2105 East Peachwood Lane, Santa Ana, CA |
|
5 |
October 1, 1996 |
A Political Cartoon Campaign Mailer |
Joseph Huerta
2114 East Pearwood Lane, Santa Ana, CA |
|
6 |
October 4, 1996 |
Campaign Bank Account Statement with Canceled Checks |
Roman Palacios for City Council, P.O. Box 6626, Santa Ana, CA |
|
7 |
October 8, 1996 |
Dear Santa Ana Residents Campaign Mailer |
Edward Chapman
2313 West Hall Ave.,
Santa Ana, CA |
|
8 |
October 23, 1996 |
Campaign Bank Account Statement with Canceled Checks |
Moreno for City Council, P.O. Box 6643, Santa Ana, CA |
|
9
|
October 28, 1996 |
Fighting For Us Campaign Mailer |
Deloris Runnells, 1213 South Parton, Santa Ana, CA |
|
10 |
October 31, 1996 |
Campaign Bank Account Statement with Canceled Checks |
Olivares for City Council, 1920 North Baker Street, Santa Ana, CA |
|
11 |
November 1, 1996 |
What Can You Buy for $61,000 Campaign Mailer |
Steven Leu
933 West Alpine Ave., Santa Ana, CA |
COUNT TWELVE
[18 U.S.C. § 1956(h)]
A. OBJECTS OF THE CONSPIRACY
From in or about June 1996 and continuing to in or about December 1997, in Orange County, within the Central District of California, defendants TED MORENO, HECTOR OLIVARES and others known and unknown to the Grand Jury, knowingly and willfully conspired and agreed with each other to commit the following offenses against the United States in violation of Title 18, United States Code, Section 1956(h):
1. To conduct and attempt to conduct a financial transaction affecting interstate commerce, which involved the proceeds of extortion under color of official right, with the intent to promote the carrying on of said specified unlawful activity, and knowing that the property involved in the financial transaction represented the proceeds of some form of unlawful activity, in violation of Title 18, United States Code, Section 1956(a)(1)(A)(i); and
2. To conduct and attempt to conduct a financial transaction affecting interstate commerce, which involved the proceeds of extortion under color of official right, knowing that the transaction was designed in whole and in part to conceal and disguise the nature, location, source, ownership, and control of the proceeds of said specified unlawful activity, and knowing that the property involved in the financial transaction represented the proceeds of some form of unlawful activity, in violation of Title 18, United States Code, Section 1956(a)(1)(B)(i).
B. MEANS BY WHICH THE OBJECTS OF THE CONSPIRACY WERE TO BE ACCOMPLISHED
The objects of the conspiracy were to be accomplished in substance as follows:
Extorted Checks
1. Defendant TED MORENO collected from the Santa Ana business owner proceeds of extortion under color of official right by instructing the owner to write checks payable to the three election campaigns ("extorted checks").
2. Defendants TED MORENO, HECTOR OLIVARES and co-conspirator Roman Palacios deposited the extorted checks into their respective campaign bank accounts.
Extorted Cash in Exchange for Documented Campaign Contributions
3. Defendant TED MORENO collected from the Santa Ana business owner and the Santa Ana landowner currency that represented the proceeds of extortion under color of official right ("extorted cash").
4. Defendants TED MORENO and HECTOR OLIVARES recruited trusted persons known and unknown to the grand jury ("conduits") to accept amounts of extorted cash in exchange for campaign contribution checks from the personal bank accounts of the conduits.
5. Defendant TED MORENO collected checks prepared by the conduits and forwarded them to his own campaign as well as to the campaigns of defendant HECTOR OLIVARES and co-conspirator Roman Palacios.
6. Defendant TED MORENO caused his own campaign and the campaigns of defendant HECTOR OLIVARES and co-conspirator Roman Palacios to report falsely on their respective Campaign Statements that they had received campaign contributions from the conduits.
Extorted Cash in Exchange for Documented Campaign Loans
7. Defendant TED MORENO gave the conduits sums of extorted cash and instructed the conduits to write personal checks designated as "loans" to the campaigns of either defendant HECTOR OLIVARES or co-conspirator Roman Palacios. Defendant TED MORENO then collected the checks prepared by the conduits and forwarded them to the campaigns of defendant HECTOR OLIVARES and co-conspirator Roman Palacios.
8. After the election in November 1996, defendant TED MORENO prepared and caused to be prepared loan repayment checks payable to the conduits who had provided checks described as loans. Defendant TED MORENO then caused the conduits to cash the loan repayment checks and return the currency to him.
9. Defendant TED MORENO caused his own campaign and the campaigns of defendant HECTOR OLIVARES and co-conspirator Roman Palacios to report falsely on their respective Campaign Statements that they had received campaign loans in the names of the conduits.
10. Defendant TED MORENO also gave amounts of extorted cash to defendant HECTOR OLIVARES and co-conspirator Roman Palacios; in exchange, defendant TED MORENO instructed them to write personal checks as "loans" to their respective campaign accounts.
C. OVERT ACTS
In furtherance of the conspiracy and to accomplish the objects of the conspiracy, defendants TED MORENO, HECTOR OLIVARES, and others known and unknown to the Grand Jury committed various overt acts in Orange County, within the Central District of California, including but not limited to the following:
The overt acts alleged in Count One of this indictment, as set forth in paragraphs 1 to 11 of the overt acts in Count One, are incorporated herein by reference and are alleged as overt acts 1 through 11 of this Count.
12. In or about May or June 1996, in Santa Ana, California, defendant TED MORENO collected $2,500 cash from a courier sent by the Santa Ana landowner as an installment payment for the total contribution amount of approximately $15,000.
13. On or about June 1, 1996, in Fountain Valley, California, defendant TED MORENO collected from the Santa Ana landowner approximately 14 gold Krugerrand coins as an installment payment for the total contribution amount of approximately $15,000.
14. On or about June 4, 1996, in Santa Ana, California, co-conspirator Roman Palacios deposited into his campaign account two extorted checks that he had received from defendant TED MORENO, each payable to his campaign in the amount of $1000.
15. On or about June 5, 1996, in Huntington Beach, California, defendant TED MORENO caused the conversion of fourteen of the gold Krugerrand coins collected from the Santa Ana landowner into approximately $5,320 in cash.
16. In or about June or July 1996, in Fountain Valley, California, defendant TED MORENO collected $2,000 cash from the Santa Ana landowner as an installment payment for the total contribution amount of approximately $15,000.
17. On or about June 11, 1996, in Santa Ana, California, defendant HECTOR OLIVARES deposited into his campaign account three extorted checks that he had received from defendant TED MORENO, each payable to his campaign in the amount of $1000.
18. On or about June 18, 1996, in Santa Ana, California, defendant TED MORENO deposited four extorted checks, each in the amount of $249, into his campaign account.
19. Between approximately June 1996 and November 1996, in Santa Ana, California, defendants TED MORENO, HECTOR OLIVARES, and co-conspirator Roman Palacios discussed at least two ways to infuse all the currency received by the three campaigns: (a) recruit conduits to accept amounts of extorted cash in exchange for campaign contribution checks, and (b) provide cash to conduits and the council candidates in exchange for checks designated as "loans."
20. In or about June 1996, in Santa Ana, California, defendant HECTOR OLIVARES accepted extorted cash from defendant TED MORENO in exchange for extending a "loan" by way of personal check to the campaign of co-conspirator Roman Palacios.
21. In or about June 1996, in Santa Ana, California, defendant TED MORENO provided co-conspirator Roman Palacios with a sum of cash and instructed him to use this money to pay for his personal living expenses. Defendant TED MORENO explained that once his personal account balance increased and appeared to justify a campaign loan, co-conspirator Roman Palacios should disburse the funds in the form of a campaign loan.
22. In or about July 1996, in Santa Ana, California, co-conspirator Roman Palacios, following the instructions provided by defendant TED MORENO, wrote a loan check from his personal account to his own campaign.
23. On or about July 15, 1996, in Santa Ana, California, co-conspirator Roman Palacios deposited into his campaign account three extorted checks that he had received from defendant TED MORENO, each payable to his campaign in the amount of $1000.
24. On or about July 19, 1996, in Santa Ana, California, co-conspirator HECTOR OLIVARES deposited into his campaign account two extorted checks that he had received from defendant TED MORENO, each payable to his campaign in the amount of $1000.
25. In or about August or September 1996, in Santa Ana, California, defendant TED MORENO removed approximately $2000 in extorted cash from an envelope he had hidden beneath a dresser in his house and gave it to co-conspirator Roman Palacios.
26. In or about October 1996, in Santa Ana, California, defendant TED MORENO provided a conduit with a sum of cash and instructed the conduit to write and cause others to write campaign contribution checks and checks designated as campaign loans.
27. In or about October 1996, in Santa Ana, California, defendant TED MORENO collected from a conduit checks that they were issued from the account of the conduit and others recruited by the conduit.
28. In or about October 1996, in Santa Ana, California, defendant TED MORENO provided a second conduit with a sum of cash and instructed the conduit to write campaign contribution checks and checks designated as campaign loans.
29. In or about October 1996, in Santa Ana, California, defendant TED MORENO collected from the second conduit a campaign contribution check and checks designated as campaign loans.
30. On or about November 25, 1997, in Santa Ana, California, defendant TED MORENO prepared a loan repayment check for $249 from the campaign account of defendant HECTOR OLIVARES.
31. In or about November 1997, in Fountain Valley, California, defendant TED MORENO presented three loan repayment checks to a conduit, each in the amount of $249.
32. In or about November 1997, in Santa Ana, California, defendant TED MORENO caused the conduit to arrange the cashing of each of the three loan repayment checks for $249 and to return the proceeds to him.
33. On or about December 31, 1997, in Santa Ana, California, defendant TED MORENO prepared a loan repayment check in the amount of $999 from the campaign account of co-conspirator Roman Palacios.
34. In or about December 1997, in Santa Ana, California, defendant TED MORENO presented the $999 loan repayment check to a second conduit.
35. In or about January 1998, in Santa Ana, California, defendant TED MORENO caused the second conduit to return approximately $999 in cash as proceeds of the $999 loan repayment check.
COUNTS THIRTEEN THROUGH EIGHTEEN
[18 U.S.C. §§ 1956(a)(1)(A)(i); 2]
On or about the dates set forth below, in Orange County, within the Central District of California, defendants TED MORENO and HECTOR OLIVARES did knowingly and willfully conduct, aid, abet, counsel, induce, procure and cause to be conducted the following financial transactions affecting interstate commerce, involving the proceeds of extortion under color of official right, with the intent to promote the carrying on of extortion under color of official right, knowing that the funds involved in the transactions represented the proceeds of some form of unlawful activity:
COUNT DATE AMOUNT TRANSACTION
13 9/27/96 $321.10 Check from account of Moreno for City Council to Beard Printing for printing cost of campaign mailer
14 10/1/96 $980 Check from account of Olivares for City Council to U.S. Post Office for postage cost of campaign mailer
15 10/1/96 $2,951.28 Check from account of Moreno for City Council to B&Z Printing for printing cost of campaign mailer
16 10/31/96 $1,909.09 Check from account of Olivares for City Council to U.S. Post Office for postage cost of campaign mailer
17 11/1/96 $5,273.68 Check from account of Moreno for City Council to U.S. Post Office for mailing cost of campaign mailer
18 11/8/96 $916.30 Check from account of Moreno for City Council to B&Z Printing for printing cost of campaign mailer
COUNTS NINETEEN THROUGH TWENTY-FOUR
[18 U.S.C. §§ 1956(a)(1)(B)(i); 2]
On or about the dates set forth below, in Orange County, within the Central District of California, defendants TED MORENO and HECTOR OLIVARES did knowingly and willfully conduct, aid, abet, counsel, induce, procure and cause to be conducted the following financial transactions affecting interstate commerce, which involved the proceeds of extortion under color of official right, knowing that the transactions were designed in whole and in part to conceal and disguise the nature, location, source, ownership, and control of the proceeds of extortion under color of official right. At said times and places, defendants TED MORENO and HECTOR OLIVARES knew that said property involved in the financial transactions represented the proceeds of some form of unlawful activity:
COUNT DATE AMOUNT TRANSACTION
19 6/5/96 $4180 Conversion of 11 gold Krugerrand coins into both $2,000 cash and a check in the amount of $2,180
20 10/23/96 $249 Deposit of loan check no. 1008 from conduit to account of Olivares for City Council
21 10/23/96 $500 Deposit of contribution check no. 2200 from conduit to account of Moreno for City Council
22 10/31/96 $2197 Deposit of loan checks nos. 411, 739, 2726, and 3566 from Roman Palacios and conduits to account of Palacios for City Council
23 11/5/96 $249 Deposit of contribution check no. 3506 from conduit to account of Moreno for City Council
24 11/5/96 $249 Deposit of loan check no. 3505 from conduit to account of Olivares for City Council
A TRUE BILL
__________________________
Foreperson
NORA M. MANELLA
United States Attorney
DAVID C. SCHEPER
Assistant United States Attorney
Chief, Criminal Division
MONICA BACHNER
Assistant United States Attorney
Chief, Santa Ana Branch Office
