SAN FRANCISCO
10/13/2011 04:08 pm ET Updated Aug 06, 2015

Ed Lee Donations Investigated For Potential Money Laundering

While the Huffington Post San Francisco team has yet to make it all the way through Ed Lee's recently released 130-page unofficial campaign biography, Ed Lee: An Unexpected Mayor, it's a safe bet that the controversy surrounding airport shuttle company GO Lorrie's donations to his campaign doesn't feature too prominently in the narrative.

In fact, Lee's campaign most assuredly hopes the second edition will similarly omit the criminal investigation into allegations of money laundering arising from said donations launched earlier this week by San Francisco District Attorney George Gascon.

A report by the Bay Citizen revealed last week that 16 employees of the airport shuttle company donated the maximum possible amount to Lee's campaign -- the highest number of employees for any company in the city. Two of the company's drivers told the Bay Citizen they had been directed to donate by a manager who promised to later reimburse them.

The city's campaign finance law caps what individuals are allowed to contribute to a particular candidate at $500. It's illegal for someone to make a contribution in another person's name.

These donations came in the wake of a reorganization of San Francisco International Airport's shuttle parking system that was highly beneficial to the company.

In a letter sent to City Attorney Dennis Herrera, a lawyer for a rival shuttle service opposing the new parking system wrote, "[The changes] cannot be justified on any basis founded on proper considerations, such as passenger convenience, efficiency, traffic concerns, etc. ... Most alarming of all are reports that these proposed changes are the result of direct and unrelenting pressure from political forces in the city. This type of artificial interference with airport operations smells of political favoritism."

While the timing has raised allegations of favor trading, both Lee's campaign and airport officials insist that the mayor had no influence in the decision.

Lee campaign spokesman Tony Winnicker told SF Weekly that the campaign has returned $8,500 in questionable donations, and released a statement that read, "Mayor Lee's campaign is committed to 100 percent compliance with all campaign laws and we deplore any violation ... That's why we return any contributions that raise suspicion through our own review, inquiries and concerns."

The revelations have ignited a firestorm of condemnation from Lee's fellow mayoral hopefuls. The San Francisco Examiner reports:

"City Hall cannot be for sale," [Board of Supervisors President] Chiu said in a statement. "Pay-to-play politics has no place in San Francisco, and it will have no place in a Chiu administration -- you can count on that."

Likewise, the mayoral campaign of Public Defender Jeff Adachi, called for an end to City Hall's culture of "backroom deals and crony politics."

City Attorney, and fellow mayoral aspirant, Dennis Herrera wrote an open letter to Gascon, as well as State Attorney General Kamala Harris and U.S. Attorney Melinda Haag, urging each of them to open investigations into the donations.

"As you are likely well aware, numerous political endeavors undertaken on interim Mayor Lee's behalf throughout his nine-month mayoralty -- both before and after he declared his candidacy -- have been plagued by ethical and legal questions in published news accounts," wrote Herrera. "Taken together with these latest, more serious allegations -- that contributions to interim Mayor Lee's campaign were laundered through a politically connected business -- such persistent and unanswered questions risk fomenting public cynicism and district in San Francisco's local government and electoral processes."

California's Fair Political Practices Commission has also launched its own investigation into the legality of the donations.

This is not the first time GO Lorrie has apparently allegedly engaged in a similar practice. During former Mayor Gavin Newsom's 2003 runoff against Supervisor Matt Gonzalez, 48 GO Lorrie employees donated $100 each to Newsom's campaign, with all but three of those donations occurring on a single day.

D.A. Spokesperson Stephanie Ong Stillman said, because the investigation is still in an "information gathering phase," it's premature to speculate about what the consequences would be for either GO Lorrie or Lee's campaign if violations in campaign finance law were found to have occurred.

The mayor, who opted out of public financing for his campaign, is the race's top fundraiser, having solicited over $750,000 in donations as of late September.

CORRECTION: A previous version of this article overstated how much money was reportedly returned by Lee's campaign as $11,500; the campaign stated that it had returned $8,500.