Former Oakland Mayor Sheng Thao, her romantic partner and a pair of influential Oakland business owners all pleaded not guilty to a rash of federal corruption and bribery charges last week.
Thao, her partner Andre Jones, David Duong and his son Andy were all named in a federal indictment that was unsealed Friday morning.
All four were subsequently arraigned in U.S. District Court in Oakland, where they entered their pleas, posted bail and were released.
“The indictment returned by the grand jury describes a corrupt scheme in which the defendant used bribes, mail fraud, wire fraud and other illegal practices to manipulate and corruptly influence the levers of local government,” said Patrick Robbins, first assistant U.S. attorney for the Northern District of California.
“The public needs to know it can trust those in charge of City Hall to work for the best interests of the people of Oakland,” Robbins said during a news conference from the U.S. Department of Justice offices in San Francisco prior to the arraignment. “This public trust is broken when elected officials agree to a pay-to-play system to benefit themselves.”
The indictment comes about six months after a well-publicized FBI raid on the home Thao and Jones share in the Oakland hills and about two months after Oakland voters removed her from office in a recall election.
Properties belonging to the Duongs were also searched by the FBI, the IRS and the U.S. Postal Inspection Service on the same day as the raid on Thao’s home.
Payments and promises
The alleged scheme started around October 2022, just weeks prior to the November election Thao narrowly won, and involved $95,000 in four separate payments from the Duongs to Thao and Jones, according to federal prosecutors, who say an additional $205,000 was promised.
At Thao’s direction, the money was allegedly paid to Jones for non-existent work he did for the Duongs’ recycling company, California Waste Solutions.
In exchange, Thao allegedly agreed that the city would buy small modular homes from a Duong-owned company, extend a city recycling contract for another of their companies and appoint a high-level city official to benefit the Duongs’ business interests.
In addition to the $95,000, the Duongs also allegedly bribed Thao by paying $75,000 for a negative campaign mailer targeting her political foes in the final days of the 2022 election.
Thao’s lawyer Jeff Tsai said Friday that the government’s case is full of holes, his client is innocent of all charges and that the indictment came as a complete surprise given Thao’s willingness to cooperate.
“There are numerous allegations that are made, but what is missing from this indictment is anything that truly indicates that the mayor had any involvement in the scheme that the government has described,” Tsai said.
“From the beginning, the mayor has indicated that she is willing to sit down and cooperate with the government’s investigation. That opportunity ultimately never arose,” he said.
Andy Duong’s lawyers released a statement following the arraignment saying their client is also innocent of all charges.
“We have kept quiet despite the media frenzy of the past months in the hope that the government would correctly come to see through objective investigation that the allegations are baseless, and being fanned by nothing more than gossip and supposition stitched together by the fabrications and delusions of those who lack all fundamental credibility,” according to the statement sent on behalf of attorneys Winston Chan, Doug Sprague and Erik Babcock.
David Duong’s lawyers released a statement saying he is innocent and is looking forward to proving so in a courtroom.
“Mr. Duong denies wrongdoing and will vigorously defend these allegations in court. He looks forward to prevailing in this case and continuing his decades of service, philanthropy, and devotion to our community and the Bay Area,” according to the statement sent on behalf of attorneys Ed Swanson and August Gugelmann.
Jones declined to comment Friday but said he would make a statement at some point in the future.
Charges and possible penalties
All four defendants are facing a variety of charges including conspiracy, wire fraud, mail fraud and bribery. In addition, Andy Duong is facing one count of making false statements to a government agent.
Thao and Jones are free on separate $50,000 bond agreements, while the Duongs are both free on a $100,000 bond each.
If convicted on all counts, they could each face roughly 90 years in prison and fines of more than $1 million.