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Recalled Oakland Mayor Sheng Thao, 3 others indicted in bribery scheme

Former Oakland Mayor Thao indicted by federal authorities on corruption charges
Former Oakland Mayor Thao indicted by federal authorities on corruption charges 05:19

Federal authorities on Friday morning announced details of an indictment against recalled Oakland Mayor Sheng Thao, her boyfriend, and two members of the politically influential Duong family on corruption charges.

Thao turned herself in at an Oakland courtroom Friday morning just as the press conference announcing the indictment was about to get underway. She did not answer any questions or offer any reaction to the indictment.

Corruption charges

Thao, her romantic partner Andre Jones, local businessman David Duong and his son, Andy Duong, were named in the grand jury indictment. The San Francisco Chronicle broke the news that Thao would be facing criminal charges Thursday, citing an anonymous source. 

Department of Justice announces indictment of recalled Oakland Mayor Sheng Thao 10:09

U.S. Attorney's Office made the announcement Friday morning in a joint press conference with the FBI, the U.S. Postal Inspection Service, and a representative from the IRS Criminal Investigations Unit's Oakland field office. 

"The indictment returned by the grand jury describes a corrupt scheme in which the defendants used bribes, mail fraud, wire fraud, and other illegal practices to manipulate and corruptly influence the levers of local government," said Patrick D. Robbins, First Assistant U.S. Attorney for the Northern District of California.  

Robbins went on to note that the eight charges described in the indictment were just allegations and that the defendants were presumed innocent until their guilt is established at trial.

Alleged bribery scheme

Watch: Former Oakland Mayor Sheng Thao surrenders at courthouse following indictment 02:34

"The indictment charges a scheme that the defendant entered into, knowing that bribes would be offered and accepted by Thao and Jones, in exchange for allowing the Duongs to exercise illegal influence over the levers of city government," Robbins said. "The illegal conspiracy began on October 2022, before the November 2022 election."

Robbins went on to describe how Thao and Jones purportedly worked with the Duongs in the corruption scheme. He said prior to the election that put Thao in office, she "made commitments to take official actions as mayor that would benefit the Duongs." Among the actions included an agreement by Thao to purchase housing units owned by the family as well as exerting her influence "to help appoint a high-level city official to benefit the Duongs' business interests." The mayor would also extend the city's recycling contract with the Duongs' recycling company, Cal Waste Solutions.

In exchange, the Duongs allegedly provided payment to Thao and Jones in a variety of ways including a negative mailer campaign targeting Thao's rivals in the Oakland mayoral race that cost $75,000 and a direct payment to Jones of $95,000 that was "disguised as wages for a no-show job," with additional payments promised.  

As CBS News Bay Area reported last year, those mailers were requested by Mario Juarez, who co-founded a housing company with Andy Duong. 

And while he is not named in the indictment, CBS News Bay Area reporting and court documents show that Juarez would be "Co-Conspirator 1." And according to the indictment, following Thao's election, Co-Conspirator 1 texted Andy Duong to say: "...we may go to jail, but we are $100 million richer." To which Andy Duong is said to have replied: "Money buys everything."

Shen Thao indictment documents by CBS News Bay Area on Scribd

The indictment charges each defendant with one count of conspiracy to commit bribery, one count of bribery concerning programs receiving federal funds, one count of conspiracy to commit mail and wire fraud, one count of mail fraud and two counts of wire fraud.  Additionally, Andy Duong was also charged with one count of making false statements to government agents.

If convicted of all charges outlined in the indictment, the defendants could spend up to 35 years in prison.

Thao, Jones and the two members of the Duong family all pleaded not guilty when they were arraigned in U.S. District Court Friday morning. The defendants also posted bail and were released.

Embattled former mayor

After her arraignment, Thao and her attorney Jeff Tsai stopped briefly outside the courthouse and Tsai spoke on her behalf.

"The press conference that was held by the government earlier this morning was successful in grabbing headlines. But what it did not do is serve the ends of justice," said Tsai. "The indictment itself is full of allegations, but it is not chock full of evidence. And that's what we're going to prove in the course of our defense in this case."

Recalled Oakland Mayor Sheng Thao's attorney Jeff Tsai speaks outside courthouse 01:53

Tsai went on to say the case against his client was based on "allegations by an unknown co-conspirator" and that the mayor "looks forward to defending herself against these charges."

Tsai and Thao did not take any questions after giving the brief statement.

"Mr. Duong denies wrongdoing and will vigorously defend these allegations in court. He looks forward to prevailing in this case," David Duong's attorneys said in a statement. 

"Andy Duong is innocent of the charges," his attorneys said in their own statement. "We have kept quiet despite the media frenzy of the past months in the hope that the government would correctly come to see through objective investigation that the allegations are baseless."

Jones told the gathered media that he did not have any comment, but would provide a public statement in the future. 

The indictment comes two months after Oakland voters recalled Thao from office.  

Last June, the FBI raided the home that Thao shares with Jones. Investigators also raided properties linked to the Duong family, who own a recycling company contracted with Oakland. 

Members of the Duong family had been accused of making illicit campaign donations to Thao and other politicians. A subsequent federal grand jury subpoena demanded that Oakland City Hall turn over a trove of documents in connection with the investigation.

"Our communities depend on local government for critical services," Robbins added. "The public needs to know it can trust those in charge of city hall to work for the best interests of the people of Oakland. This trust is broken when elected officials agree to a pay-to-play system to benefit themselves."  

Former confidante and Thao's ex-chief of staff Renia Webb told CBS News Bay Area that Thao and her boyfriend were involved in pay-to-play schemes after she was elected to office.

"I have done nothing wrong"

In her first public comments days after the raid, Thao offered a blanket denial of wrongdoing. When CBS News Bay Area interviewed Thao last summer, she maintained those denials and dismissed claims that her boyfriend Jones had any involvement in her administration   

"I am not the subject of an investigation. I have done nothing wrong," she said at the time. 

Robbins said Thao and the others named in the indictment were due to appear in an Oakland district court Friday morning at 10:30 a.m.

On Thursday when the news broke, Thao did not respond to a request for comment by CBS News Bay Area. 

A special election to replace Thao is scheduled to be held April 15. Former Congresswoman Barbara Lee announced her plan to run for the office last week, joining a growing field of candidates that includes Webb, former candidate for Oakland mayor Loren Taylor, who formally announced his candidacy in the special election Thursday.     

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