Coincidence or Corruption? 

Documents raise new questions about the conduct of Senator Don Perata. Plus, the effects of an indictment on Sacramento and Oakland.

Politicians often accept campaign contributions and then perform favors for the people or companies that made them. Typically, they'll make calls or sponsor legislation on behalf of the contributors. But if they do these things in exchange for cash payments for their personal use, they have crossed a legal line. At that point, we call it a kickback or a bribe.

As a federal grand jury considers whether to indict state Senator Don Perata, a move that two sources told the Express they expect soon, previously undisclosed evidence raises new questions about whether the Oakland Democrat engaged in such activity. These public records appear to dovetail with subpoenas issued in the federal probe of the senator that indicate the FBI, the US Attorney's Office, and a grand jury are examining whether he operated a complicated money-laundering scheme involving his close friend and business associate, Timothy Staples.

The questionable financial dealings between Perata and Staples have been explored in detail elsewhere, most notably in the San Francisco Chronicle. Full Disclosure has chosen to examine them again now because of the probability of an upcoming indictment and due to the availability of the recently uncovered documents. Having said that, however, none of this evidence suggests that the dealings detailed here are necessarily part of the case involving the senator.

Over the years, Staples was hired — sometimes at Perata's urging — by several companies that had business in Sacramento, the Bay Area, and around the state. The senator then would do something to benefit those companies. Staples, in turn, would pay Perata as a "consultant."

If the money Staples paid Perata came in exchange for the favors the senator performed for the companies that hired his friend, then the payments would be considered bribes or kickbacks. But for years, Perata maintained that there was no such connection, saying repeatedly that Staples had paid him only as a "consultant" for unrelated work. The senator's spokesman, Jason Kinney, told the Chronicle in 2004 that the senator had maintained "a bright, unbroken line" between his official work and the work he did for his friend.

But recently obtained public records indicate that Perata was much more than a "consultant" to Staples. The records also raise questions as to whether the senator falsified government documents to conceal his true relationship with Staples and the identities of their clients.

In 2000, for instance, Staples listed Perata not as a consultant but as his co-equal in the firm Ascendent Solutions, calling the senator his "co-manager" and "co-member" in official documents filed with the California Secretary of State's office. In addition, that year Staples also filed official records with the Sonoma County Clerk's Office stating that Ascendent Solutions had started another company called "Perata & Staples." In other words, Staples appears to have considered Perata his business partner and not just an outside consultant.

Perata made no mention of "Perata & Staples" or his apparent partnership in Ascendent Solutions in his state-required statement of economic interests for 2000. Instead, the senator listed Ascendent Solutions as one of the companies that hired him as a "consultant" that year. Perata indicated that Ascendent Solutions paid him between $10,001 and $100,000 in 2000 — state law does not require him to be more specific. However, if he had listed himself as a partner in Ascendent Solutions — as Staples apparently considered him to be — then the senator would have been required to list all the names of the company's clients.

The senator's spokesman, Kinney, declined to be interviewed for this story and asked to have all questions e-mailed to him. He then would not answer individual questions about the dealings between the senator and Staples, and offered only the following response: "Senator Perata's prior business relationships were wholly appropriate and clearly allowed under the law." Kinney also said that Perata does not believe he will be indicted and called the Express' sources "patently wrong." Staples himself could not be reached for comment.

Over the years, the total amount of money earned by Ascendent Solutions and another company Perata worked with, Staples Associates, is unknown. According to public records, the two businesses collected at least $345,530 from political campaigns run by or associated with the senator from 2001 through mid-2004. However, that total does not include monies the companies received for business unrelated to political campaigns.

By contrast, public records provide a clearer picture of how much money the two companies paid Perata. It amounted to about $400,000 from 2000 through 2003, according to public records and newspaper accounts. In his statements of economic interests, Perata stated that the companies paid him between $10,001 to $100,000 per year from 2000 through 2002 and more than $100,000 in 2003. He told the Chronicle in 2004 that the companies had paid him about $100,000 a year during that time.

The payments nearly doubled Perata's legislative salary. The senator, however, has never specified exactly what he did to earn that much money. Staples once told the Chron that he paid the senator for business development advice.

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