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How To Uncover A Scandal From Your Couch

Aired 1/27/14 on KPBS News.

A how-to guide for unraveling San Diego campaign finance scandals involving "foreign nationals" and other alleged scoundrels.

Special Feature Unraveling A Scandal, Part Two

Part two of a how-to guide for unraveling a San Diego campaign finance scandal involving a straw donor, a "foreign national" and local politicians.

News broke in San Diego last week about a mysterious foreign national bent on influencing San Diego politics by illegally funneling money to political campaigns through a retired San Diego police detective and a undisclosed “straw donor.” Now, the politicians on the receiving end of the tainted funds are scrambling to distance themselves from the scandal.

The main piece of information that started it all was an unsealed FBI complaint.

Fifteen pages in length, the report named only the detective, Ernesto Encinas, and a self-described “campaign guru” in DC, Ravneet Singh, as conspirators. The names of everyone else involved were not disclosed. Instead, politicians were “candidates,” the moneymen were called “the Straw Donor” and “the Foreign National,” and informants were labeled “CIs.”

It didn’t take long for reporters to piece together clues — mainly by combing through publicly accessible information from the San Diego City Clerk’s website — to uncover who was involved.

Here’s how we tackled it:

Clue 1

Above: A section from a federal complaint.

From the FBI complaint:

Around May 2012, Ernesto Encinas and the unnamed “Foreign National” created a PAC (Political Action Committee).

Encinas invested $3,000 into this PAC and the Foreign National invested $100,000 “through a United States-based shell corporation.”

This PAC spent $114,000 in favor of “Candidate 1, a candidate for the office of mayor of San Diego during the 2012 primary election cycle.”

Between May 20 and May 31, 2012, the PAC spent approximately $86,000 on mailers and related services.

That’s more than enough information to identify the Foreign National, the PAC and the Candidate. Here’s how we started:

There were four main candidates for mayor in 2012: Carl DeMaio, Bonnie Dumanis, Bob Filner, and Nathan Fletcher (it’s safe to assume, for now, that the FBI probe did not involve little-known 2012 mayoral candidates John “Woody” Woodrum or Steven H. Greenwald). So Encinas almost certainly donated $3,000 into a PAC supporting one of those four people. That information would be readily available on the City Clerk’s website. (Story continues below after screenshots.)

Credit: City Clerk website

Go to the City Clerk's website and click on "Elections, Petitions and Campaign Disclosure."

Credit: City Clerk website

Select "City Elections."

Credit: City Clerk website

Click on "Campaign Disclosure."

Credit: City Clerk website

Choose to view "Public Access Portal."

Credit: City Clerk website

Select a year from the drop down menu.

Select “2012″ from the drop-down menu. Select “Export Amended.” This will download a Microsoft Excel file with all the campaign expenditure and contribution information for the 2012 mayor’s race. Once in that file — on the first sheet labeled “A-Contributions” — you search for “Encinas.” Boom, there he is.

Credit: City Clerk website

The results of a search for "Encinas."

Encinas donated to a PAC called “San Diegans for Bonnie Dumanis for Mayor 2012, Sponsored by Airsam N492RM, LLC.” If you look into that PAC on the same sheet, you’ll find a $100,000 donation from “Airsam N492RM, LLC.” This jives with the second bullet point from the complaint ($3,000 from Encinas, $100,000 from a shell company). Then we used Wysk.com, a business research website, to look into the LLC.

Credit: Wysk.com

Wysk.com is a business research website.

Credit: Wysk.com

Results of a search for “Airsam N492RM, LLC.”

Credit: Wysk.com

The website allows you to view a company's officers and directors.

Credit: Wysk.com

Results show the company is registered to Susumo Azano.

The LLC is registered to Susumo Azano, a Mexican billionaire. Now to verify.

The fourth bullet point above says the PAC in question spent approximately $86,000 on mailers and related services. If you go back to the same Excel file where we found the Encinas donation, and switch to the tab labeled “D-Expenditure” at the bottom, it’ll bring up all new data. You then filter the column with all the PAC names until you isolate all the expenditures from the “San Diegans for Bonnie Dumanis…” committee.

What you’ll get is all the expenses this PAC made in support of Dumanis. If you take into consideration the dates mentioned in the federal complaint (May 20-May 31, 2012), and only look at expenditures made during that time period, you’ll get $86,478 spent on “Mailers” and “Mailer Graphic Design.”

Credit: City Clerk website

The expenses this PAC made in support of Dumanis.

Candidate 3

Candidate 3

What do we glean from the info provided under the section of Candidate 3?

Around October 2012, the “Straw Donor” wrote a $120,000 check to an independent expenditure committee that favored Candidate 3. This money, according to the complaint, came from the Foreign National (Susumo) through the straw donor.

Shortly after, the same “Straw Donor” wrote another check, this time for $30,000, “this time to a political party committee associated with Candidate 3′s campaign.”

That’s enough to go on.

Head back to that same file we were working on before. Since $120,000 is a good chunk of change, it’s likely there weren’t a lot of these size donations made during the campaign cycle. Sure enough, there is only one:

Credit: City Clerk website

A $120,000 donation to a committee in support of Bob Filner.

There is one $120,000 donation to “San Diegans in Support of Bob Filner for Mayor – 2012.” It was Sept. 27, 2012 (remember the complaint said “around October 2012″). It was from a company called “South Beach Aquistions, LLC.” If we head back to the website we used before to search for LLCs, we look up South Beach and find it’s registered to Marc Chase.

Credit: Wysk.com

Wysk results for "South Beach."

A few minutes on Google and we learn that Marc Chase owns a luxury car dealership in La Jolla — Symbolic Motor Car Company (further research shows Chase owns a ton of LLCs, and many of those LLCs have had their status ‘suspended’ by the Franchise Tax Board). It looks like Marc Chase is the straw donor, but we can’t be sure yet.

Next, we took a leap and run Chase through the Sunlight Foundation’s Influence Explorer, an online tool for tracking money in politics. We put Chase’s name into the explorer and searched for any money he may have given in the 2011/2012 election cycle.

Credit: Sunlight Foundation's Influence Explorer

Searching Sunlight Foundation's Influence Explorer.

There’s a hit!

Credit: Sunlight Foundation's Influence Explorer

Results using Sunlight Foundation's Influence Explorer.

Looks like Chase gave $30,000 on Sept. 30, 2012, to the Democratic Congressional Campaign Committee. So Chase is the straw donor.

We’ll be updating this story later this week with more details, but for now, tell us what you think! Comment below or reach out to the reporters: Brad Racino and Joe Yerardi.

Comments

Avatar for user 'CaliforniaDefender'

CaliforniaDefender | January 27, 2014 at 3 p.m. ― 7 months, 3 weeks ago

Great work KPBS inewsource, Brad Racino, and Joe Yerardi! This is of immense value to the citizens of San Diego.

Please keep it up and thank you for showing us how it is done! I think you just created a thousand more armchair investigative journalists.

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Avatar for user 'Brad Racino'

Brad Racino, KPBS Staff | January 27, 2014 at 3:11 p.m. ― 7 months, 3 weeks ago

Thanks so much! I'm glad you enjoyed. Check this story again in a couple days and we'll have even more about the process.

( | suggest removal )