The Investigation 

How a vengeful ex-lover set the FBI on Don Perata.

Page 2 of 4

At the time, Perata's reputation as a political boss was starting to blossom. Insiders had begun talking about the "Peratistas," a group of Oakland City Councilmembers he had helped get elected: De La Fuente, Sheila Jordan, and Nate Miley. Yui Hay Lee says that during the campaign he and others arranged for Hu to meet with Perata, whom she didn't know at the time. During the pow-wow, Lee recalls that Perata, always preoccupied with the mother's milk of politics, asked, "Can she raise money?" Perata didn't endorse Hu, but she obviously made an impression: After Perata was elected to the assembly, he hired her to join his staff in 1997.

By the late '90s, Hu parlayed her relationship with Perata, the friendship she established with De La Fuente, and the contacts she made from Wishom into a role as an East Bay lobbying powerhouse. Hu possessed the perfect combination of sociability and charm. But ultimately, city hall sources said, she owed her success to Perata and De La Fuente. "You tell me how she got so good so fast after losing a city council race," one Oakland business leader said.

Councilwoman Nancy Nadel recalled that Hu's first big foray in Oakland politics was lobbying for a contract with the software company Oracle. A fat slice of the lucrative 1998 pact, which was designed to deliver Oakland's municipal computer system out of the dark ages, was carved out for Wishom's F2 company, one of the minority contractors in the deal. But Wishom didn't need his girlfriend's help: He had enough juice of his own to win a piece of the contract, De La Fuente said.

The contract itself was a disaster for Oakland. The Oracle system crashed constantly, and just before the 1999 holiday season, the payroll system failed to cut paychecks for hundreds of city employees. To top it off, the contract's price tag skyrocketed from the original $14 million to about $25 million.

But the Oracle debacle had no ill effects on Hu's lobbying practice. On the contrary, her influence seemed only to strengthen. It was not unusual to see her take a cigarette break outside City Hall with De La Fuente. And she accompanied city officials on at least one junket to China as they sought out pandas for the Oakland Zoo.

Some Oakland insiders came to believe that Hu would not take on a client without first obtaining Perata's blessing. "It became known that if you wanted to do business in this town, you had to hire Lily Hu," said one high-placed Oakland business source. But apparently her success was not based upon her expertise on the issues, two city sources said. "It struck me how little she knew about what her clients wanted," one said. "Basically, she would introduce her clients and then sit there."

Whatever role Lily Hu played, hiring her paid off for some of the city's biggest development interests, including the DeSilva Group, Forest City, and Signature Properties. The DeSilva Group won approval in 2002 for its controversial plan to build more than four hundred homes in the flood-prone Leona Quarry despite fierce opposition from local residents. Forest City stands to pocket a $60 million subsidy when it erects seven hundred apartments near downtown in the next year or two. And Signature Properties netted a $30 million discount when it purchased sixty acres of Oakland waterfront from the port to construct three thousand condos.

Earlier this year, Hu even hauled in a land deal of her own. Property records show that she bought waterfront property along Tidewater Avenue in Oakland as a minority stakeholder in a pact with Port Commissioner Anthony Batarse Jr. and Ana Chretien, owner of ABC Security, which supplies security for City Hall and the Oakland airport. Chretien and Batarse, who is the owner of Lloyd Wise Auto Center, also are close friends with De La Fuente. They each put in $746,145, while Hu coughed up $373,222.

Hu and Wishom's fortunes were going in opposite directions by the final year of their relationship. Hu had become the primary breadwinner, and Wishom, who was in the throes of a financial meltdown, was relying upon her for "contacts and contracts," as one City Hall watcher put it. Wishom owed the IRS $111,000 for unpaid taxes, penalties, and interest going all the way back to 1985. Court records show he also had a $145,000 judgment from March 2002 hanging over his head stemming from a lawsuit filed against F2 by tech vendor Avnet Inc. Faye Coulter, one of Wishom's attorneys, says her client was planning to heed her advice to file for bankruptcy.

Christmas 2002 came and went without Lily and Frank throwing one of their famous holiday parties. Behind closed doors, their relationship had begun to fall apart; he moved out of their house at the end of May. Wishom would later insist in court that their decision to split after the New Year was mutual. Privately, however, he told an acquaintance that Hu had just awakened one morning and ended it. As many men often believe in such a situation, Wishom suspected there was another man.

On June 8, 2003, Wishom confronted Hu at the home of an Oakland doctor she was meeting for a dinner date. She told police Wishom followed her there; he later claimed he just happened to be driving by and saw her car parked out front. Wishom rang the doorbell and confronted the doctor and Hu, who he said looked "disheveled." Hu said Wishom got angry and threatened to "blow everybody up." Two days later, Hu got a call from Wishom's therapist, who warned her that her ex had expressed a desire to harm her. While the therapist didn't think Wishom would really hurt her, he felt he legally had to notify her.


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