Thread: Mexican puts $500,000 in illegal contributions into U.S. elections

AZANO BUILT WEALTH, REPUTATION WITH IRON FIST

Businessman eyed in S.D. corruption scandal well-versed at using connections to advantage

Greg Moran & Morgan Lee • U-T 12:01a.m. Jan 26, 2014

If a Mexican moneyman was looking to turn San Diego’s waterfront into Miami West, maybe he got the idea while enjoying the view from the Trump high-rise on South Ocean Drive in Hollywood Beach.

The 41-story tower features a wine cellar and tasting salon, cigar lounge and — on the 40th floor — a 5,000-square-foot, five-bedroom, five-bathroom suite owned by José Susumo Azano Matsura.

Azano, 48, has not been charged in San Diego’s latest scandal. But a lobbyist, a political consultant and a security consultant all face allegations in federal court that they injected $500,000 of his money into local campaigns — an illegal act because he’s a foreign national.

His motivation, prosecutors said in court Friday, was to transform downtown San Diego.

Azano has several private jets at his disposal. His whereabouts aren’t known, whether he’s at one of his two homes in Coronado, the condo in Florida or closer to his home base in Mexico — where he has also been mentioned in a federal probe involving money laundering.

There are two Azano-owned homes on the Coronado Cays waterfront, both of which were searched by the FBI last week. At one home on Green Turtle Road, a woman in a new Cadillac Escalade drove away shortly after 1 p.m. on Friday. A man at the home indicated it was Azano’s wife.

Later, a young man who did not identify himself answered the bell at the expansive home on Buccaneer Way. He said Azano was not at home. He did not respond when asked if he knew where Azano was, then shut the door.

Parked on the curb outside the home was a 2014 Mercedes with a license plate frame with “Symbolic” emblazoned on it. State motor vehicle records said the car was leased to the Azano family.

Symbolic Motor Car Co. in La Jolla is owned by businessman Marc Chase. Federal documents do not name Chase, but contain enough information to identify him as a “straw man” donor who gave Azano’s money to campaigns in his own name.

Federal authorities confirmed Friday that a search warrant had been served at the car dealership, too.

MEXICO AND BEYOND

Born in Guadalajara, Mexico, to a family of Japanese descent, Azano went to work for his father’s associated construction businesses before his 20th birthday, according to information on his company website.

In 1998, Azano would found Security Tracking Devices. Initially focused on location devices for cargo vehicles, the company prospered as it installed broadband phone service at Mexico’s federal social security agency.

He has parlayed his family construction fortune into a cross-border empire by using bold business tactics, government connections and a bare-knuckle style to expand his influence.

“The company offers software and hardware solutions in border protection, urban management, cyber security, transportation, law enforcement, and natural disaster preparedness for operating systems throughout the world, and their reach has stretched far past its initial borders in Mexico,” one news release says. “They have expanded into areas of South America and beyond, remaining one step ahead of the technology curve as well as the most advanced of cyber criminals.”

Azano has proved adept at securing lucrative government contracts in Mexico — from license-plate supply contracts to military equipment for eavesdropping on cellphones and text conversations — casting suspicion over his close ties to politicians and military commanders.

Azano’s business attracted international attention after winning a $375 million contract to provide phone-hacking equipment to Mexico’s Defense Secretariat.

The technology, rumored to be capable of tapping conversations on previously impervious Nextel networks and BlackBerry devices, exploited an indispensable niche for a military engaged in an all-out offensive against organized crime under former President Felipe Calderón.

The contract with Security Tracking Devices was flagged later for irregularities and concerns of corruption in 2011 by central government auditors, amid questions in the Mexican media about the steep markup on equipment traced by media to Israeli suppliers, and whether competitive bidding took place.

AZANO V. SEMPRA

It was a land dispute in Baja California that cemented Azano’s reputation for throwing around his weight in business in political circles.

San Diego-based utility holding company Sempra Energy, a Fortune 500 company, identified Azano as the financial backer of an aggrieved rancher, Ramon Eugenio Sanchez Ritchie.

The rancher asserted that he was forcibly removed in 2006 from an outlying parcel at the company’s Costa Azul natural gas export terminal. The facility, located 15 miles north of urban Ensenada, began operations in 2008, off-loading and processing liquefied natural gas that arrives by ship from overseas.

The conflict boiled over Feb. 11, 2011, when dozens of Ensenada police officers swarmed the $1.5 billion energy installation, cutting through locks, confronting the operators and attempting to shut it down.

The police said they were dispatched by the mayor of Ensenada because of “flagrant violations” of safety, zoning and environmental rules. Sempra told another story.

The company alleged later in U.S. District Court that wire payments of $2 million were delivered in the preceding weeks to an account controlled by then-Ensenada Mayor Enrique Pelayo Torres and his son. The company claimed Azano was behind the payments.

Pelayo Torres denied the allegations, and Sempra’s racketeering claim against Azano was later dismissed by a judge.

How Azano joined with Sanchez Ritchie to take on Sempra is unclear even to energy-sector analysts tracking the events.

“Who knows? It’s possible that they met in other circles and saw that (Costa Azul) was a very big, profitable investment, and that sparked a little glimmer in his eyes,” said energy analyst Miriam Grunstein at the Mexico City-based think tank CIDE.

Azano’s involvement in the Costa Azul terminal was the subject of conversations on national security and economic security between Calderón and President Barack Obama, El Universal newspaper and others reported.

Taking office, current Mexican President Enrique Peña Nieto was reportedly briefed in detail on the dispute at the natural gas terminal.

The land conflict, bankrolled by Azano, grinds on to this day in Mexico’s state, federal and agrarian court systems.

U-T San Diego obtained a contract signed by Sanchez Ritchie, ensuring Azano a 55 percent share of any financial settlement with Sempra. It also gives him two-thirds of the land — a coastal haven near where Sempra built a luxury-appointed, mission-style resort of its own for executive retreats.

FAMILY HOLDINGS

The extent of the Azano family holdings are another public mystery. Mexican media accounts routinely estimate the fortune in excess of a billion dollars.

Grupo Azano, founded by Azano’s father, José Susumo Azano Moritani, is anchored by Jalisco-based TEI Construccion, catering to both multinational corporations and local government agencies on sprawling factories, a convention center and grandiose public library outside Guadalajara, Mexico’s second-largest city.

Aside from being embroiled in the Sempra controversy, Azano kept a much-lower profile in San Diego until last week, when his name first surfaced in the corruption investigation. While he is not named in the court documents made public so far, sources have said Azano is the “foreign national” who orchestrated secret donations that were funneled through shell companies and straw donors to mayoral campaigns in San Diego in 2012 and 2013.

A federal complaint said in October 2012 that $120,000 of funds Azano had deposited in bank accounts controlled by Chase went to an independent expenditure committee supporting former Mayor Bob Filner. He also made two donations totaling $60,000 to the national and local Democratic Party committees, money federal authorities also said came from Azano.

A company he controlled also poured $100,000 into supporting District Attorney Bonnie Dumanis’ unsuccessful 2012 campaign for mayor.

Azano’s wife, Margarita Hester de Azano, also gave Dumanis $500 in December 2011 and $700 in June 2013. A male relative named Edward, likely Azano’s son, also gave Dumanis $500 in December 2011.

Elizabeth Lugo, a business associate from an Azano company called Flight Maintenance Solutions, gave Dumanis $700 in May 2013.

KENTUCKY LENDER

Public records in Broward County, where Azano has his Florida condo, show that in November Azano entered an “assignment of rents” agreement. The lender was Gus Goldsmith, a Louisville, Ky., businessman well known in that city for his Action Loans “hard money” lending business.

The documents said that Goldsmith loaned the Azanos $2.65 million in November, payable in five years.

Hard money lenders specialize in loans to people or businesses who can’t get them from traditional lenders. (“When Banks Say No, We Say Yes,” reads an online slogan the company uses). They’re often tied to the value of a real estate asset and are similar to short-term bridge loans. Interest rates are usually higher than traditional loans.

It’s unknown why someone with Azano’s resources would need the help of a hard-money lender. Goldsmith did not respond to a request via email and phone to comment. The document says the Azanos signed over any rent or “all monies due or to become due” to Goldsmith as security for the loan.

A profile of Goldsmith in a Louisville business publication said that his empire includes pawn shops, buying distressed real estate, payday loans and the hard money business. He drives a $350,000 Bentley. One of his companies last year was implicated in a large gift-card theft ring in the city, but Goldsmith was not charged and said the company was used by the ring.

http://m.utsandiego.com/news/2014/ja...ith-iron-fist/