California state Sen. Yee arrested in corruption case Veteran state senator, running for secretary of state, accused of corruption, gun-trafficking conspiracy

Video: Leland Yee arriving at the San Francisco Court House

State Sen. Leland Yee, an outspoken advocate of gun control and open government, was arrested Wednesday on charges that he conspired to traffic in firearms and traded favors in Sacramento for bribes - campaign cash paid by men who turned out to be undercover FBI agents.

Yee, a Democrat who represents half of San Francisco and most of San Mateo County and is running for secretary of state, was one of 26 people ensnared in a five-year federal investigation that targeted Raymond "Shrimp Boy" Chow, a notorious Chinatown gangster who had claimed to have gone straight, officials said.

The charges, filed Monday and unsealed Wednesday, reverberated through circles of power in San Francisco and Sacramento, shaking up party politics and the secretary of state race. Leading Democratic senators, weary of recent scandals involving party legislators, called for Yee's resignation.

Yee did not comment after he was arraigned at the U.S. District Court in San Francisco on charges of conspiring to traffic in firearms and scheming to defraud citizens of honest services. He appeared somber in a casual jacket before being released on a $500,000 bond.

His lawyer, Paul DeMeester, declined to talk about the charges, saying only that his client was "holding up."

"Our top priority was to get the senator released, and we've accomplished that," DeMeester said. "The future will hold a lot of work."

Senator Leland Yee is chased by reporters as he leaves the federal building in San Francisco, CA, Wednesday Mar. 26, 2014. The FBI raided State Sen. Leland Yee's office in Sacramento and other locations were searched by the FBI in San Francisco. He was reportedly arrested on public corruption charges Wednesday morning amid raids of his office in Sacramento and searches by the FBI in San Francisco. less Senator Leland Yee is chased by reporters as he leaves the federal building in San Francisco, CA, Wednesday Mar. 26, 2014. The FBI raided State Sen. Leland Yee's office in Sacramento and other locations were ... more Photo: Michael Short, The Chronicle Photo: Michael Short, The Chronicle Image 1 of / 98 Caption Close California state Sen. Yee arrested in corruption case 1 / 98 Back to Gallery

The FBI, in a 137-page complaint, alleged that Chow and five other defendants laundered $2.3 million for undercover agents between March 2011 and December 2013. An agent told them he derived the money from crimes like illegal gambling, drug dealing and marijuana growing, the FBI said.

Most of the suspects - four of whom remain at large - are linked to the Chinatown brotherhood association that Chow heads, known as Ghee Kung Tong, whose headquarters was raided Wednesday. Charges included trafficking in illicit guns, cigarettes and liquor.

The FBI reported infiltrating the group so deeply that one agent, while posing as a member of La Cosa Nostra, was "inducted" as a consultant.

Shift in 2011

Investigators said that by 2011, the probe had turned to Yee. A close associate of both he and Chow - former San Francisco school board member Keith Jackson, who also was arrested Wednesday - had solicited an undercover agent to contribute to Yee's unsuccessful campaign to become San Francisco mayor that year, the FBI said.

The criminal complaint alleges that Yee later repeatedly took bribes and participated in explicit discussions about facilitating a gun-trafficking deal.

FBI Special Agent Emmanuel Pascua made a point of saying in the agency's affidavit that Yee was a reluctant target for the undercover agents. Yee, he said, complained about one FBI agent's "tendency to speak frankly and tie payment to performance," and threatened to cut off contact with him.

However, Yee "continued to deal with the agent and never walked away from quid pro quo requests," Pascua wrote.

Yee's arrest came amid searches of his office in Sacramento and his home in San Francisco's Sunset District, where FBI agents seized desktop computers and boxes wrapped in red evidence tape. Raids occurred at numerous other locations and were carried out by hundreds of FBI and IRS agents, who were assisted in the probe by the police forces in San Francisco, Oakland and Antioch.

The charges against Yee stand in contrast to his record as a champion of government transparency and the tightening of gun laws. The former San Francisco school board member, supervisor and assemblyman - who has been in public office since 1988 - has been criticized by gun rights proponents for his efforts to strengthen restrictions on semiautomatic rifles.

Yee also has successfully pushed laws to toughen lobbying and campaign finance disclosure requirements and last year authored legislation that launched online voter registration in California.

But the complaint paints a picture of a politician desperate for money - funds he needed to retire $70,000 in campaign debt left over from his run for mayor as well as for his efforts to become secretary of state. The FBI also accused Yee of planning to use his position as secretary of state to help enrich people who funneled him money.

Much of the case revolves around Jackson, 49, who has worked as a consultant to a number of prominent public relations firms in San Francisco. He is accused of conspiring to traffic in guns and drugs and of commissioning a murder-for-hire requested by one of the undercover agents.

The federal complaint says Jackson met Chow in 2010 and the next year began asking the FBI agents who had infiltrated Chow's group to contribute to Yee's mayoral campaign. One agent purportedly made a donation of $5,000, well above the $500 limit.

Buying 'official acts'

After Yee lost the race for mayor, the complaint states, Jackson and Yee solicited the undercover agent for donations to retire his debt and agreed that the money would buy "official acts," including Yee lobbying a manager at the state Department of Public Health in support of a contract under consideration by the agency. The agent reported giving Yee a $10,000 campaign contribution for the lobbying.

In May 2013, the complaint states, Yee provided an official Senate proclamation honoring Chow's association in exchange for a $6,800 donation to his secretary of state campaign - the maximum allowed by law.

Soon after, the complaint alleges, Jackson and Yee agreed to introduce a donor who supposedly had medical marijuana interests to state legislators who had influence over proposed cannabis legislation. Yee received $10,000 and $11,000 for two separate introductions, the FBI charges.

The alleged gun deal began to take shape in August 2013, the complaint states. Jackson, the FBI said, asked an undercover agent to provide a campaign donation in exchange for Yee facilitating a meeting with an arms dealer so the agent could purchase a "large number of weapons to be imported through the Port of Newark, New Jersey."

During that meeting, the complaint states, Yee discussed "certain details of the specific weapons" the agent wanted to buy. In January, at another meeting with Jackson and the agent, Yee allegedly said he wanted the agent and Jackson to make all of the money because he didn't "want to go to jail."

Yee told the agent he needed to be careful, citing the indictment of another senator accused of corruption, the FBI said. Yee was quoted as saying he thought the case "was a classic example of involving too many people in illegal activities" and that he took an "agnostic" stand on the weapons deal.

"People want to get whatever they want to get. Do I care? No, I don't care. People need certain things," Yee said, according to the complaint.

The case is another complicated twist in the life of Chow. In 1992, the Hong Kong native was indicted with two dozen others on racketeering charges for their alleged involvement in everything from underage prostitution to the international heroin trade.

Gun convictions

Chow was subsequently convicted of gun charges and sentenced to 25 years in prison. In 2003, however, he was released after he cut a deal with the government to testify against a high-ranking associate. And in recent years, Chow has insisted that he had turned his life around, touting his connections to - and awards handed out by - San Francisco politicians.

Yee's arrest triggered condemnation from California's Democratic senators, who are already wary of their reputation due to recent scandals including the arrest of Sen. Ron Calderon, D-Montebello, on bribery charges.

"I want Leland Yee gone," said Senate President Pro Tem Darrell Steinberg during a news conference at his Sacramento office, while flanked by fellow senators including Loni Hancock of Berkeley and Mark Leno of San Francisco.

Leno said, "Every indictment, every arrest, every arraignment and even every suspicion or allegation reflects very poorly on each of us and all of us."