SAN BERNARDINO – An attorney has filed a lawsuit seeking reimbursement for taxpayers of the $102 million settlement made by the San Bernardino County Board of Supervisors in 2006 with Rancho Cucamonga-based developers Colonies Partners LP.

Cory Briggs filed the suit in San Bernardino County Court on Monday on behalf of two non-profit groups, the Inland Oversight Committee and Citizens for Responsible Equitable Environmental Development, and presented it to the county Board of Supervisors during the regular meeting on Tuesday.

“I invited the board to adopt a resolution that the county is going to cooperate in our lawsuit and not fight it,” Briggs said.

“And so now the ball is in the county’s court. Do they want to stand up and defend an illegal contract and screw the taxpayers for $102 million plus interest, or do they want to right the wrong and help us get the money back from the developer and give it back to the taxpayers?”

The lawsuit alleges that because former Board of Supervisors Chairman Bill Postmus pleaded guilty in March to taking bribes while attempting to reach the settlement with the Colonies, he violated California Government Code, Section 1090.

Code 1090 says that public officials “shall not be financially interested in any contract made by them in their official capacity, or by any body or board of which they are members.”

The settlement ended litigation over who was responsible for paying for flood-control improvements at the developer’s 434-acre residential and commercial development in Upland.

“Bill Postmus pleaded guilty of violating Code 1090 and the Supreme Court has said that a violation of Section 1090 required the beneficiary to return all the money,” Briggs said. “So the developer has to give back the $102 million.”

Colonies co-managing partner Jeff Burum, former county Supervisor Paul Biane, Mark Kirk, former chief of staff for Supervisor Gary Ovitt and former Assistant Assessor Jim Erwin were indicted in May on felony conspiracy, bribery and conflict of interest charges.

To read entire story, click here.

BY IMRAN GHORI
STAFF WRITER
ighori@pe.com

Published: 06 January 2012 11:19 AM

Defense attorneys in the Colonies corruption case announced in court Friday morning they are seeking records from an influential union representing public safety employees.

Attorneys are also seeking additional records from the county flood control district concerning its four-year legal battle with Colonies Partners.

They filed subpoenas seeking the documents from the San Bernardino County Safety Employees Benefit Association and the county, but Judge Michael Smith delayed making any decision after attorneys said they are continuing to discuss agreements to get the material.

The documents were sought as part of the Colonies bribery case.

Rancho Cucamonga developer Jeff Burum, former county Supervisor Paul Biane, former Assistant Assessor Jim Erwin, and Mark Kirk, former chief of staff to Supervisor Gary Ovitt, face conspiracy and bribery-related charges.

Prosecutors have alleged that a $102 million settlement the county approved in November 2006 with Burum’s company, Colonies Partners, was a result of bribery and extortion.

Erwin’s attorney, Rajan Maline, filed the motion seeking records from SEBA detailing its involvement in the November 2006 campaign for Measure P, a pay increase and term limit measure that Biane championed.

To read entire story, click here.

SAN BERNARDINO – Defense attorneys in a San Bernardino County corruption case are requesting documents from a public safety labor union they believe will help refute allegations of blackmail against a Rancho Cucamonga developer and the union’s former president.

The attorneys are also seeking from the county’s Flood Control District documents from its nearly five-year legal battle with Rancho Cucamonga-based Colonies Partners LP. Colonies’ co-managing partner Jeff Burum filed a civil lawsuit against the county in March 2002, alleging the county refused to pay for flood control improvements on property owned by Colonies Partners’.

The requests were addressed Friday by lawyers for four defendants in the alleged corruption case – Burum, former county Supervisor Paul Biane, former Assistant Assessor Jim Erwin, and Mark Kirk, former chief of staff for Supervisor Gary Ovitt – during proceedings in San Bernardino Superior Court.

The four men have been charged with multiple felonies, including conspiracy and conflict of interest stemming from the county’s landmark $102 million settlement with Colonies Partners in November 2006.

The documents sought from the Safety Employees Benefit Association, or SEBA, include voter guides and other records that defense attorneys believe show the union’s support for Measure P – a ballot initiative aimed at bringing term limits and pay raises to county supervisors.

Defense lawyers want the SEBA documents so they can refute Grand Jury testimony, which alleged that Burum influenced Biane to support the lawsuit settlement by creating a campaign to oppose Biane’s Measure P initiative.

At the time, Erwin was the president of SEBA. Erwin’s attorney, Rajan Maline, said Friday that SEBA’s support for Measure P was never in question.

“We want those records to show the unwavering support for Measure P,” Maline said later, outside of court.

In Burum’s lawsuit against the county, he alleged the county abandoned its 70-year-old flood control easements on property owned by Colonies Partners’, a consortium of 22 investors who paid into the 434-acre residential and commercial development in Upland. Burum argued that the county forced Colonies to pay for a 67-acre flood control basin that should be the county’s responsiblity.

Prosecutors allege Burum and the three other defendants conspired together for the county to settle the lawsuit for $102 million. They allege the settlement was tainted by blackmail and bribery.

Among the allegations: Burum, in late 2006, bankrolled a campaign against Biane’s Measure P that would limit term limits for supervisors to three and increase their salaries by roughly 50 percent.

To read entire story, click here.

By Mark Gutglueck
Friday, January 6, 2012

Questions continue to dog the second highest ranking member of the county auditor-controller/treasurer-tax collector’s office with regard to the role he and a political action committee he controlled played in illegally passing through and laundering money for those convicted of or charged with participation in a bribery and extortion conspiracy.

At issue is how Matt Brown, a former member of the Republican Central Committee and the one-time chief of staff to former Second District San Bernardino County supervisor Paul Biane, has been able to avoid being criminally charged after he became entangled in a set of circumstances that led to the indictment of Biane, as well as another former member of the board of supervisors, Bill Postmus, together with the chief of staff to another supervisor, a one-time county employee union president and the businessman accused of bribing them.

Brown was moved into the position of assistant county auditor-controller in 2010 by county treasurer/auditor-controller Larry Walker. Brown is also the founder/principal of two political action committees, the San Bernardino County Young Republicans and the San Bernardino County Taxpayers Association.

In 2006, Brown, who was then supervisor Biane’s senior staff member, founded a political action committee (PAC) to assist Biane and other members of Biane’s political circle in distributing money to politicians they supported. That PAC, known as the San Bernardino County Young Republicans, has been alleged by the California Attorney General’s Office and the San Bernardino County District Attorney’s office to have been used as a vehicle to launder bribes and kickbacks to Biane.

During the first year of its existence, the San Bernardino County Young Republicans PAC had raised $7,500. In November 2006, Biane joined with his then-colleagues on the board of supervisors, Bill Postmus and Gary Ovitt, to approve a $102 million payout to Rancho Cucamonga-based Colonies Partners to settle a lawsuit that company had brought against the county over flood control issues at the Colonies at San Antonio residential subdivision and Colonies Crossroads commercial subdivision projects in northeast Upland. Supervisors Josie Gonzales and Dennis Hansberger opposed that settlement.

Campaign finance records show that the San Bernardino County Young Republicans PAC, received a $100,000 check from Colonies Partners, L.P. on June 17, 2007. In two separate indictments, one returned by a criminal grand jury in February 2010 against Postmus and his one time political associate Jim Erwin and in another indictment returned in May 2011 against Biane, Erwin, Colonies Partners managing principal Jeff Burum and the former chief of staff to supervisor Ovitt, Mark Kirk, it was alleged that Biane actually controlled the San Bernardino County Young Republicans PAC through Brown and that the $100,000 donation was a quid pro quo paid in exchange for Biane’s vote to approve the settlement. Also delineated in the February 2010 indictment were five unindicted co-conspirators identified as John Does 1 through 5, who are identifiable through information contained elsewhere in the public record including the superseding May 2011 indictment as Colonies Partners managing principals Burum and Dan Richards; Colonies Partners public relations consultant Patrick O’Reilly; Kirk; and Biane. According to prosecutors, Postmus controlled two political action committees, the Inland Empire PAC and the Conservatives For A Republican Majority PAC, which each received separate $50,000 donations from the Colonies Partners principals which were also bribes. Erwin’s Committee For Effective Government PAC likewise received a $100,000 donation from Burum and Richards that was a bribe, according to prosecutors; and Kirk’s Alliance For Ethical Government PAC received a $100,000 contribution from Burum and Richards that was also a bribe, per the indictment.

Postmus last March pleaded guilty to the five felonies alleged against him in the February 2010 indictment, including conspiracy, one count of accepting a bribe, one count of conflict of interest, and one count of misappropriation of funds.

Postmus in April was the star witness before the second grand jury which indicted Burum, Biane and Kirk and reindicted Erwin. Erwin, who served as assistant assessor under Postmus after the latter was elected to that post in 2006 and took office in 2007, continues to maintain his innocence on the charges stemming from that case, including conspiracy, two counts of corrupt influencing, two counts of offering a bribe, two counts of extortion, one count of misappropriation of public funds and one count of forgery. Biane, Kirk and Burum maintain their innocence. As of yet, no charges have been filed against Richards or O’Reilly.

The indictments allege that Burum in 2006, with the assistance of Erwin and O’Reilly, had brochures prepared which purported that Postmus, who was then the chairman of the board of supervisors as well as chairman of the San Bernardino County Republican Central Committee and was running for county assessor, was a homosexual who was addicted to methamphetamine, and that Biane, who was then the vice chair of both the board of supervisors and the Republican Central Committee and at that time engaged in an election campaign, was teetering on the brink of bankruptcy. Burum’s company, the Colonies Partners, had filed a lawsuit against the county in 2002 over flood control issues at the companies Colonies at San Antonio development in northeast Upland. Ultimately, Burum withheld the mailing of those brochures. It was three weeks after the November 2006 election, in which Postmus and Biane were elected and reelected, that the board of supervisors voted 3-2 to confer the $102 million settlement on the Colonies Partners. The indictments allege that the series of $100,000 donations to the political action committees founded and controlled by Postmus, Brown, Kirk and Erwin were in fact quid pro quos — bribes — paid in exchange for the approval of the settlement. Prosecutors allege that Biane, through Brown, secretly controlled the San Bernardino County Young Republicans PAC.

The Sentinel is informed that a complaint has been filed with the state Fair Political Practices Commission citing a PAC founded by Brown in 2008, the San Bernardino County Taxpayers Association, which is separate from the San Bernardino County Young Republicans PAC alluded to in the indictments. According to well placed sources, both the San Bernardino County Taxpayers Association and the San Bernardino County Young Republicans PAC were involved in the activity now under further investigation.

On March 17, 2008, Brown formed the San Bernardino County Taxpayers Association PAC and named J.M. Olchawa as the PAC’s treasurer. Both Brown and Olchawa are residents of Grand Terrace. Olchawa endowed the PAC with its first operating capital in the form of a $100 contribution. Less than a month later, on April 9, the San Bernardino County Young Republicans PAC contributed $40,000, which had apparently originated with the $100,000 contribution from the Colonies Partners the previous year, to the San Bernardino County Taxpayers Association PAC. The following month, on May 29, 2008, one of the political action committees controlled by Postmus, the Inland Empire PAC, infused the San Bernardino County Taxpayers PAC with $3,000 and the month after that, on June 2, 2008, with another $2,000. That $5,000, too, had apparently been originally provided by the Colonies Partners.

In the less than two month period between the $40,000 contribution from Brown’s own Young Republicans PAC on April 9 and Postmus’ Inland Empire PAC’s $2,000 donation on June 2, the San Bernardino County Taxpayers Association PAC received a substantial amount of money in the form of both contributions and loans, all from other political figures. On April 25, 2008, the Committee to Elect Paul Biane gave the San Bernardino County Taxpayers Association PAC a $15,000 contribution. On April 29, 2008 the Committee to Elect Dick Larsen provided the San Bernardino County Taxpayers Association PAC with a $10,000 loan. Larsen was then the county treasurer. On May 5, 2008 the Committee to Elect Gary C. Ovitt made a $15,000 contribution to Brown’s San Bernardino County Taxpayers Association PAC. That money may have originated with the Colonies Partners before being provided to Kirk’s Alliance For Ethical Government PAC and then being provided to Ovitt. On May 9, 2008, the Josie Gonzales for Supervisor campaign provided a $15,000 contribution to the San Bernardino County Taxpayers PAC. On May 16, 2008, Bill Emmerson for Assembly 2008 made a $5,000 contribution to Brown’s recently formed PAC. The same day, the San Bernardino Public Employees Association PAC provided Brown’s PAC with a $10,000 contribution. On May 23, 2008, the Committee to Elect Gary C. Ovitt provided Brown’s PAC with a $10,000 loan. On May 27, 2008, the Hansberger for Supervisor Committee made a $25,000 contribution to the San Bernardino County Taxpayers Association PAC. The next day, May 28, the Paul Cook for Assembly 2008 Committee provided Brown’s PAC with a $5,000 loan. The same day, the Committee to Elect Paul Biane

made a $10,000 loan to Brown’s PAC. On May 29, Bill Emmerson for Assembly 2008 made a $5,000 contribution to the PAC and on June 2, 2008, the Hansberger for Supervisor Committee made a $15,000 contribution to the San Bernardino County Taxpayers Association PAC.

The lion’s share of the money Brown’s PAC took in was used to fund Hansberger’s effort to be reelected as county Third District supervisor that year. According to campaign disclosure documents, the San Bernardino County Taxpayers Association PAC on May 18 provided the Hansberger for Supervisor Committee with $57,030.70 and on June 30, 2008, more than three weeks after Hansberger had lost the election to Neil Derry on June 3, Brown’s PAC gave the Hansberger for Supervisor Committee $100,920.29.

The Fair Political Practices Commission is now investigating the lack of any subsequent accounting for the $35, 000.00 in loans made to the San Bernardino County Taxpayers Association PAC by the Larsen, Ovitt, Cook and Biane campaign committees. All references to those loans disappeared from subsequent campaign filing statements made on behalf of the PAC by Olchawa. The loans in question appear to be outstanding. No explicit reference to repayments to any of the lending parties can be found in any of the San Bernardino County Taxpayers Association PAC’s financial disclosure statements. While the online filing made by the Committee to Elect Gary Ovitt shows an outstanding loan of $10,000 to the San Bernardino County Taxpayers Association PAC committee as of 12/31/2010, online filings for the other lending parties were not immediately available. There is no indication in any available documentation showing any of the loans were repaid.

The lack of repayment, and lack of accounting of the still existent outstanding loans or failure to note the loans were forgiven is alleged to be multiple violations of the Political Reform Act. Moreover, the lack of notation of the loans might suggest that the funds received by the committee during the 2008 electioneering season from the Larsen, Cook and Biane campaigns were being laundered for Hansberger, according to the complaint received by the FPPC.

Another issue in the complaint and the follow-up FPPC investigation is the connection between the PAC and the Hansberger Campaign, which contributed money to the PAC and was also the major beneficiary of the PAC’s expenditures. In this way, money provided to Brown’s PAC is suspected of having been used to attack Derry without adequate disclosure of the origin of that money. Those mailers sent out attacking Derry did not disclose that Hansberger’s campaign was involved in funding them.

Many familiar with Brown’s role in the Colonies matter have questioned why prosecutors did not seek and obtain from the grand jury an indictment of Brown. The indictment itself describes how the political action committee he founded and controlled served as a laundering vehicle through which bribes allegedly provided by Burum were passed, action virtually indistinguishable from that engaged in by the indicted Kirk, another chief of staff to a board member who voted to approve the Colonies settlement.

Brown was one of 45 witnesses who testified before the grand jury this spring before it handed down the indictment naming Burum, Biane, Kirk and Erwin. In that testimony Brown said SEBA, the sheriff’s deputies union that Erwin once headed, had promised to provide, but then failed to come through with, backing for a countywide measure Biane was sponsoring in 2006 to boost the pay for county supervisors. An examination of campaign reporting documents and other material, however, indicates that SEBA in fact did support the Biane-backed proposal, known as Measure P, which passed, resulting in an immediate $22,000 annual increase to supervisors’ salaries. Prosecutors declined to say whether Brown’s misstatement of fact before the grand jury constituted perjury. No charges have been filed against him.

A possible explanation of how it is that Brown has avoided prosecution on several counts is that he has been working as an informant for the district attorney’s office. It is known that beginning in 2009, Brown began wearing a “wire,” that is, a hidden electronic audio device at work while he was serving in the capacity of Biane’s chief of staff. Reportedly, the target of this effort was Biane himself. To date, no incriminating statements by Biane on any of those tapes have surfaced or been produced by the prosecution, despite requests by defense attorneys for their production. Transcripts of some of those conversations have been turned over to defense attorneys.

At some point in the spring of 2010, Biane became aware that his chief-of-staff was seeking to entrap him. There ensued strained relations between the two and Brown was put on paid leave after he filed a claim in which he alleged he was being harassed. Brown was then transferred to the county treasurer/auditor-controller office under Larry Walker.

Walker installed Brown as his second-in-command, i.e. as the assistant auditor-controller. In so doing, Walker ousted his longtime assistant and close associate Betsy Starbuck, who was ignominiously sacked after having served more than twenty years as Walker’s right hand woman, both when Walker was Fourth District supervisor, the position he held before he ran for auditor-controller, and as auditor controller.

The displacement of Starbuck, who after more than eight years in the position of assistant auditor-controller practically ran the division, to accommodate the inexperienced Brown has sparked a widespread belief in the halls of the county that the move was imposed on Walker by county chief executive officer Greg Devereaux and district attorney Mike Ramos as part of an effort to protect a witness seen as crucial to the prosecution of the Colonies settlement criminal case. Collectively and individually, Walker, Brown, Devereaux and Ramos were unwilling to comment on the matter.

By Mark Gutgleuck
Friday, January 6, 2012
Originally Published: Friday, December 30, 2011

As of earlier this week, former state assemblyman Brett Granlund had actively avoided several attempts to serve him with a subpoena relating to the Colonies Settlement case.

Well informed sources have told the Sentinel that lawyers for the defendants in the Colonies case want to question Granlund with regard to his knowledge about several aspects of the criminal prosecution of former county supervisor Paul Biane, former Fourth Supervisorial District chief-of-staff Mark Kirk, former sheriff’s deputy union president Jim Erwin and Rancho Cucamonga-based developer Jeff Burum.

In May, Biane, Erwin, Kirk and Burum were named in a 29-count indictment charging them with conspiracy, bribery and extortion related to what prosecutors allege was an effort to improperly settle for a $102 million payout a lawsuit Burum’s company, Colonies Partners, had brought against the county over flood control issues at its development project in northeast Upland. In November 2006, Biane, who was then the county’s Second District supervisor, Fourth District supervisor Gary Ovitt and then-First District supervisor Bill Postmus voted to approve that settlement in a 3-2 vote opposed by then-supervisor Dennis Hansberger and supervisor Josie Gonzales.

Postmus, who along with Erwin was previously charged with conspiracy and bribery in conjunction with his vote on the $102 million settlement, in March pleaded guilty to soliciting and receiving bribes, conspiracy and conflict of interest, and agreed to turn state’s evidence. In April, he was the star witness before the grand jury that indicted Biane, Burum and Kirk and reindicted Erwin.

Prosecutors’ allege Burum, together with Erwin, who was once the president of the county’s sheriff’s deputies’ union and was then working as a consultant to the Colonies Partners, prior to the November 2006 vote threatened to carry out an informational campaign involving mailers revealing Postmus’ homosexuality and use of illegal drugs and Biane’s insolvency, but ultimately refrained from the distribution of the information. These “threatening, menacing, commanding or coercing” acts, constituted extortion, the prosecution alleges. After the vote, Burum provided two political action committees controlled by former supervisor Bill Postmus with separate $50,000 checks, a political action committee controlled by Erwin with a $100,000 check, a political action committee created by Kirk with a $100,000 check, and a political action committee founded by Biane’s chief-of-staff Matt Brown, but which prosecutors claim was secretly controlled by Biane, with a check for $100,000. Those checks constituted bribes, prosecutors maintain. Prosecutors allege that Kirk influenced Ovitt’s vote. Kirk at that time was Ovitt’s chief of staff.

Defense attorneys, who are now seeking to obtain information to compromise the credibility of Postmus, are interested in obtaining from Granlund documents related to his communication with individuals close to the district attorney as well as the district attorney directly or indirectly and information bearing upon the motivation driving the prosecution. Granlund was once a powerful player in Republican politics in San Bernardino County, as was Postmus. Granlund has close ties to former supervisor Dennis Hansberger, Hansberger’s one-time chief of staff Jim Rissmiller, district attorney Mike Ramos and others within Ramos’s political circle. Reportedly, Granlund served as a go-between in discussions involving the district attorney’s office and Postmus in the months leading up to Postmus’ decision to turn state’s evidence. Both Hansberger and Rissmiller testified before the grand jury that indicted Biane, Burum, Erwin and Kirk.

Sources tell the Sentinel that a private investigator and process server working for one defendant’s legal team has sought to make contact with Granlund to serve him with a subpoena. As of early this week, that effort has not succeeded and in recent days, Granlund has gone to ever more extreme effort to avoid being served, refusing to answer knocks upon his door and using other tactics to evade the process server. Efforts to locate him at Platinum Advisors, the Sacramento-based lobbying firm that employs him, were thwarted when employees claimed that Granlund does not work out of that office.

In conversations he assumed to be confidential with friends and associates in San Bernardino County and the state capitol, Granlund has expressed anger with the defense’s efforts to “drag” him into the matter and he expressed concern that the questions he might be subjected to could raise issues problematic to him personally and professionally.

From left, Mark Kirk, former chief of staff to Supervisor Gary Ovitt, developer Jeff Burum, former assistant assessor Jim Erwin, and former supervisor Paul Biane, at an August court appearance.(STAN LIM/STAFF PHOTOGRAPHER)

BY IMRAN GHORI
STAFF WRITER
ighori@pe.com

Published: 31 December 2011 05:39 PM

A panel of California appellate judges could soon be deciding how, and possibly if, the Colonies corruption case will proceed to trial.

The Fourth District Court of Appeal in Riverside is considering an appeal filed by the San Bernardino County district attorney and state attorney general offices seeking to restore charges that were dismissed in August against Rancho Cucamonga developer Jeff Burum, former Supervisor Paul Biane, former Assistant Assessor Jim Erwin and Mark Kirk, former chief of staff for Supervisor Gary Ovitt.

The court completed briefings from prosecutors and defense attorneys on the appeal last month and also agreed to consider writs of mandate filed by the defense seeking to have more charges dismissed against the four. A decision is expected in the next few months.

The defendants will be returning to San Bernardino County Superior Court on Jan. 6 for a status hearing but the main focus now is at the appellate level. Except for discovery issues, further proceedings in the case have been suspended pending the outcome of the appeal.

Prosecutors have argued that the lower court erred in dismissing five of the seven counts against Burum and one count each against Biane, Erwin and Kirk from the original 29-count indictment that a grand jury returned in May.

The defendants are accused of taking part in a scheme to net Burum’s company, Colonies Partners, a $102 million legal settlement. Prosecutors allege the deal, approved by the Board of Supervisors in November 2006, was a result of extortion and $400,000 in bribes by Burum and intermediaries acting on his behalf. The settlement ended a lengthy legal battle over flood-control improvements on a Colonies’ development in Upland.

To read entire story, click here.

From left to right: Colonies scandal defendants Jeff Burum, Mark Kirk, Jim Erwin, and Paul Biane stand during a motion to delay their arraignment hearing in a San Bernardino Superior Courtroom

Joe Nelson, Staff Writer
Created: 12/30/2011 11:37:49 AM PST

Investigations into corruption in San Bernardino County advanced in fits and starts over the past year.

Prosecutors gained ground when former Supvervisor-turned-Assessor Bill Postmus agreed in March to plead guilty to bribery, conflict of interest and misappropriation of public funds and to cooperate with the ongoing investigation.

His testimony bolstered the case and resulted in charges against Rancho Cucamonga developer Jeff Burum and three other former county officials – former county Supervisor Paul Biane and former supervisorial chiefs of staff Mark Kirk and Jim Erwin – related to the county’s $102 million legal settlement with Colonies Partners LP in 2006.

A few months later, in August, Judge Brian McCarville dealt investigators a major blow when he dismissed five of the seven felony charges filed against Burum, citing insufficient evidence or prosecutorial error.

McCarville also dropped one charge of misappropriation of public funds against each of the other defendants.

Prosecutors have appealed McCarville’s August dismissal of the charges, while Burum’s attorney, Stephen Larson, has appealed McCarville’s upholding of the two remaining charges against Burum.

“Frankly, the last seven months have been very difficult for Jeff Burum and his family,” Larson said. “Jeff’s been accused of crimes he did not commit. We’ve known that from the start, and now it’s becoming increasingly clear to the community as the evidence and prosecution’s tactics come to light.”

State and local prosecutors maintain their case is on solid ground.

“We continue to be confident in the facts of this case, and in order to protect the integrity of the case and each defendant’s right to a fair trial, it would be inappropriate to comment any further,” District Attorney’s officials said in a statement earlier this month.

Just weeks after McCarville dismissed the charges against Burum and the other defendants in the Colonies’ case, FBI and IRS agents served search warrants at the homes and businesses of the four Colonies’ defendants and other figures tied to the investigation, including the Fontana home and business of former state Sen. Jim Brulte and the Riverside office of publicist Patrick O’Reilly.

O’Reilly’s attorney, Bill Lehman, said he was told by the FBI that O’Reilly is a witness, not a suspect, in the investigation.

Federal agents sought evidence of bribery, extortion or fraud, including “cash in an amount or concealed in such a manner as to indicate it is proceeds of criminal activity” according to one of the search warrants.

The momentum of the investigation this year seems to stem from information provided to investigators by Postmus, who pleaded guilty in March to 15 felonies tied to scandals at the Assessor’s Office and the county’s 2006 settlement with Colonies.

The settlement ended nearly five years of heated legal battle over who was responsible for paying for flood control improvements at the developer’s 434-acre Colonies at San Antonio residential and Colonies Crossroads retail center in Upland.

To read entire story, click here.

Friday, December 9, 2011 – 04:30 p.m.

The California Court of Appeal has now entered the fray on the Colonies case.

The 4th District Court of Appeal, Division 2 has accepted Writs of Mandate filed by defendants James Erwin, Mark Kirk and Jeffrey Burum to have additional charges dismissed.

This afternoon the court issued an order to consolidate the writs with the Attorney General’s appeal of Judge Brian McCarville’s previous dismissal of some of the charges.

An order to show cause as to why additional charges against Erwin, Kirk and Burum should not be dismissed has been issued to the Attorney General/District Attorney.

Both have been given 25 days to respond.

Of course the court could always rule in favor of the State. But today’s developments are a good sign for the defense.

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Eyler

Mike Cruz and Joe Nelson, Staff Writers
Posted: 12/09/2011 12:50:39 PM PST

Greg Eyler
SAN BERNARDINO – Gregory Eyler, a former taxpayer advocate for the San Bernardino County Assessor’s Office, pleaded no contest Friday to an allegation that he drew pay from the county for work he never performed.

Under a plea bargain with prosecutors, Eyler, 35, pleaded no contest to one misdemeanor count of presenting a fraudulent claim. He was initially charged in July 2009 with felony grand theft and public officer crimes.

Prosecutors alleged Eyler was given the job, which paid $130,000 annually, by his boyfriend and then newly elected Assessor Bill Postmus. But Eyler seldom showed up for work and when he did, his work product was minimal, they said.

Under the conditions of his plea agreement, Eyler will serve 120 days on a home-monitoring program, to be completed by July, and serve one year of felony probation.

“(Plea) discussions have always been a part of the process as this case has gone on, but it hadn’t gotten to the point of being resolved until today,” prosecutor Lewis Cope said.

Eyler initially faced a maximum of three years in prison.

He was charged in 2009 along with Postmus, who faced greater culpability in the crimes. Postmus faced additional charges of misappropriation of public funds, perjury and drug possession.

Postmus pleaded guilty in March to the charges in the Assessor’s Office case and a separate scandal relating to the county’s $102 million legal settlement with Rancho Cucamonga investor consortium Colonies Partners LP in November 2006. Postmus served as chairman of the Board of Supervisors at the time of the settlement.

Prosecutors allege the county’s settlement with Colonies was tainted by bribery and extortion, and that Colonies’ co-managing partner Jeff Burum offered Postmus $100,000 in exchange for Postmus’ vote in favor of the settlement.

Burum and the other three defendants in the Colonies’ case – former county Supervisor Paul Biane, former Assistant Assessor Jim Erwin and Mark Kirk, former chief of staff for Supervisor Gary Ovitt, deny any wrongdoing and are fighting the charges.

To read entire story, click here.

A defendant in the Colonies corruption case wins the unsealing of comments from a different grand jury

BY IMRAN GHORI
STAFF WRITER
ighori@pe.com

Published: 29 November 2011 09:29 AM

A San Bernardino County judge on Tuesday ordered the grand jury testimony of a former county official unsealed as part of a government corruption case.

Superior Court Judge Michael Smith agreed to release the testimony after a request by defense attorney Stephen Larson, who argued in a motion that it may include evidence helpful to his client, Rancho Cucamonga developer Jeff Burum.

In May, a criminal grand jury indicted Burum, former county Supervisor Paul Biane, former Assistant Assessor Jim Erwin and Mark Kirk, former chief of staff to Supervisor Gary Ovitt, on conspiracy and bribery related charges. They have all pleaded not guilty.

Prosecutors have alleged that a $102 million settlement the county approved in November 2006 with Burum’s company, Colonies Partners, was the result of bribery and extortion.

James Lindley, who worked for the county for five years, most recently as public health director until he was fired in March 2010, testified before a separate civil grand jury in April, at the same time the criminal grand jury convened.

Lindley’s testimony was not presented to the criminal grand jury, but Deputy District Attorney Lewis Cope summarized some of his comments to the panel toward the end of the proceedings — a decision questioned by defense attorneys.

“Mr. Burum is anxious to obtain all of the discovery and all of the grand jury testimony,” Larson said. “We continue to believe once all of the evidence is out in the open it will be clear that Mr. Burum did nothing wrong.”

Prosecutors did not object to the request to unseal the testimony. Cope said under state law only the presiding judge can unseal grand jury testimony so that it’s available to attorneys on both sides. In this case, Smith said Presiding Judge Douglas Elwell relayed to him that he had reviewed the testimony and gave Smith the authority to have it released.

Lindley’s testimony became an issue because of a comment attributed to him by Dennis Wagner, a former county counsel. Wagner testified that Lindley told him he had overhead Burum say he had golfed with one of the judges who heard the Colonies civil case.

To read entire story, click here.

A San Bernardino Superior Court judge on Tuesday ordered that the Grand Jury testimony of a former county official be unsealed.

Judge Michael A. Smith ordered the release of transcripts of testimony given by Jim Lindley, the county’s former public health director and former director of purchasing, before the county’s civil Grand Jury on April 21.

Defense attorney Stephen Larson requested the transcripts. He is defending Rancho Cucamonga developer Jeff Burum in a corruption case.

Burum and three former county officials are accused of conspiring to expedite a legal settlement between the county and Rancho Cucamonga investor group Colonies Partners LP, of which Burum is a co-managing partner, in exchange for bribes.

To read entire story, click here.

Tuesday, November 29, 2011 – 01:30 p.m.

The Sun / Inland Valley Daily Bulletin newspapers has convicted the four defendants in the case surrounding the $120 million Colonies settlement.

The papers ran a story Tuesday titled ‘Prisoner realignment may affect Colonies case’. The article, by reporter Joe Nelson, centers on the impact prison realignment may have on the potential sentences that defendants Jeff Burum, Jim Erwin, Mark Kirk and Paul Biane may face.

Yes, they actually did!

Even though no trial has occurred and no plea bargains have been realized in the case.

The San Bernardino County District Attorney’s Office appears to have gleefully participated in the appalling hypothetical smear story.

All defendants stand accused, not convicted.

Maybe for tomorrow Nelson can pen a story on the defendants violating their parole.

Another par for the course for editor Frank Pine’s newspapers.

Published: 29 November 2011 09:29 AM

A San Bernardino County judged ordered the grand jury testimony of a former county official unsealed as part of a corruption case.

James Lindley, a former legislative affairs and public health director, testified before a grand jury earlier this year. A separate criminal grand jury indicted a developer and three former county officials on conspiracy and bribery-related charges.

Rancho Cucamonga developer Jeff Burum, former county Supervisor Paul Biane, former Assistant Assessor Jim Erwin, and Mark Kirk, former chief of staff to Supervisor Gary Ovitt, face charges in the case.

To read entire story, click here.

A new law meant to reduce California’s prison population raises questions as to whether four defendants in a sweeping San Bernardino County corruption case would serve time in prison if convicted.

Rancho Cucamonga developer Jeff Burum and three former county officials stand charged with conspiracy to commit a crime and other offenses in connection with the county’s $102million settlement with Rancho Cucamonga investor group Colonies Partners LP in 2006. Burum is a co-managing partner of Colonies Partners.

State and local prosecutors allege Burum conspired with the other defendants in a bribery scheme to secure the landmark settlement in Colonies’ favor in exchange for bribes.

Also charged are former county Supervisor Paul Biane, former Assistant Assessor Jim Erwin and Mark Kirk, former chief of staff for Supervisor Gary Ovitt.

All four defendants deny any wrongdoing, and five of seven counts against Burum have already been dismissed.

State and local prosecutors have appealed San Bernardino Superior Court Judge Brian McCarville’s dismissal of the charges. The appeal is pending in a state appellate court in Riverside.

While the Colonies case has been called the “biggest corruption scandal in county history,” there are different schools of thought on how the Public Safety Realignment Plan, or Assembly Bill 109, will factor into whether or not the Colonies defendants, if convicted, would actually serve any time in prison.

Laurie Levenson, a professor of law at Loyola Law School and a former federal prosecutor, said she could not comment specifically on the Colonies case.

In general terms, Levenson said AB 109, while not a get-out-of-jail-free card, will make it less likely for white-collar criminals to spend any appreciable time in custody.

“I think the courts will be reluctant to put the less dangerous defendants into custody,” Levenson said.

The realignment plan, signed into law by Gov. Jerry Brown in April, shifts responsibility for parolee monitoring from the state to county probation departments. The law, which went into effect Oct. 1, also redefined which inmates serve time in prison as opposed to county jail.

Under the realignment plan, nonviolent, non-serious and non-sexual offenders would be eligible to carry out their sentences in a county jail. Judges also have the option of sentencing offenders to home detention and electronic monitoring.

Assistant District Attorney Dennis Christy, who heads the Public Integrity Unit of the District Attorney’s Office, said AB 109 would not change the sentencing scheme for the Colonies defendants.

The state has a lengthy list of criminal offenses that would still qualify for a state prison sentence under the realignment plan. Among the offenses are accepting bribes, misappropriation of public funds and conflict of interest – all offenses the four Colonies’ defendants currently face.

Christy said the Legislature recently expanded its list to include even more government corruption crimes that mandate offenders be sent to state prison rather than serve their sentences in county jails.

To read entire story, click here.

Joe Nelson, Staff Writer
Posted: 11/12/2011 06:12:51 AM PST

The ways money flowed to candidates and political action committees and alleged acts of blackmail are detailed in search warrants in San Bernardino County’s $102 million legal settlement with Rancho Cucamonga developer Colonies Partners LP in November 2006.

The warrants, released last week, also describe what led authorities to suspect a county supervisor’s former chief of staff of criminal activity before he became a witness for the prosecution.

The settlement ended nearly five years of legal battle over flood-control easements at Colonies’ 434-acre residential and commercial development in Upland.

In May, state and local prosecutors charged Colonies co-managing partner Jeff Burum, former county Supervisor Paul Biane, former Assistant Assessor Jim Erwin and Mark Kirk, former chief of staff for Supervisor Gary Ovitt, with criminal conspiracy, conflict of interest and other charges in a corruption case they are calling the biggest in county history.

The four are accused of conspiring to facilitate the historic settlement, in the developer’s favor, in exchange for bribes and political favors. All four deny any wrongdoing.

PAC contributions

Within a year of the settlement, Colonies Partners contributed a total of $400,000 to five political action committees prosecutors say were controlled by the three supervisors who voted in favor of the settlement – Bill Postmus, Biane and Ovitt – or members of their staff.

Three of the political action committees – Alliance for Ethical Government, San Bernardino County Young Republicans and the Committee for Effective Government – each received $100,000 contributions from Colonies. Kirk controlled the Alliance for Ethical Government PAC, Biane’s chief of staff Matt Brown, the San Bernardino County Young Republicans PAC, and Erwin, the Committee for Effective Government PAC, prosecutors allege.

Postmus controlled the Inland Empire PAC and Conservatives for a Republican Majority PAC, each of which received $50,000 contributions from Colonies following the settlement.

In March, Postmus, who is also the former county assessor, pleaded guilty to charges stemming from the Colonies case and a separate case in which he admitted to running a political operation out of the Assessor’s Office at taxpayer expense. As part of a plea bargain, he has agreed to turn state’s evidence in exchange for reduced charges.

Postmus’ longtime aide and protege, Adam Aleman, pleaded no contest in June 2008 to felony charges related to the Assessor’s Office scandal, including falsifying minutes to executive meetings for the Grand Jury and destroying evidence in the investigation, i.e. the hard drive of a county-owned laptop computer.

Aleman has also agreed to testify against defendants in the Colonies’ and Assessor’s Office cases as part of a plea bargain. He approached investigators five months after his arrest saying he had information about the controversial Colonies settlement.

Money trail

Within a year of receiving the contributions from Colonies Partners, money flowed from the PACs to political campaigns and activities directly related to those who controlled the PACs, according to the search warrants.

Brown’s PAC doled out more than $11,000 to Biane’s campaign for supervisor. More than $11,000 was doled out to Brown’s campaign for the Republican Central Committee, and more than $2,600 in expenditures were taken from the PAC for fundraising events and travel and lodging expenses for Brown and his wife, according to the warrants.

Kirk’s Alliance for Ethical Government contributed $10,000 to Gary Ovitt’s campaign for supervisor and $3,200 to Ovitt’s campaign for Republican Central Committee. In addition, five contributions totaling more than $1,700 were made to the campaign of Ovitt’s wife, Sue Ovitt, for a spot on the Republican Central Committee, and 11 contributions totaling more than $7,000 were made to Kirk’s campaign for the Central Committee.

To read entire story, click here.

RIVERSIDE – A federal judge seemed poised to rule that federal agents did not violate the civil rights of Rancho Cucamonga developer Jeff Burum when they served search warrants at his home and office in September.

During a two-hour hearing Thursday in U.S. District Court, Judge S. James Otero heard arguments from Burum’s attorney, Stephen G. Larson, and Assistant U.S. Attorney Jerry A. Behnke over whether federal prosecutors should be able to retain documents and other information seized during the Sept. 15 raid.

There is no deadline or estimated amount of time for Otero to deliver a decision, lawyers said. All they can do is wait for an email alert from the court that a ruling is available.

In the meantime, federal prosecutors are proceeding with their investigation of Burum and other three others in connection with the 2006 lawsuit settlement between San Bernardino County and Colonies Partners.

Former Assistant Assessor Jim Erwin and Mark Kirk, the former chief of staff for county Supervisor Gary Ovitt, also are challenging FBI searches of their property, court records indicate.

Larson alleges the warrants that FBI and IRS agents served at Burum’s home and office were overly broad and vague, and that agents were essentially on a fishing expedition. He also alleges agents acted in callous disregard for Burum’s civil rights, lying in a search warrant affidavit that Larson had condoned a search of his office and had escorted agents during the office walk-through.

Despite a declaration by FBI Agent Jonathan Zeitlin that agents did not search Larson’s office without Larson present, Larson said in a court motion that a surveillance video showed agents entering his office, and one agent went through his desk drawers.

Otero saw things differently.

“This appears to be simple human error,” Otero said during Thursday’s hearing. “A mistake does not become a significant error unless it’s not corrected.”

He based his opinion on declarations made by Zeitlin and FBI Special Agent Anthony Montero, in which Montero admitted that Zeitlin had given him the affidavit for vetting and that Montero signed off on it, overlooking the information indicating that Larson condoned the walk-through of his office and was present during it.

Behnke said the government takes such matters seriously.

“And the government apologizes for the mistake that was made,” Behnke said. He said nothing was seized from Larson’s office and law library, which are housed in the Diversified Pacific building on Civic Center Drive in Rancho Cucamonga. Burum founded Diversified Pacific in the 1990s, and roughly four dozen other businesses that Burum has a vested interest in are housed in the same building.

Larson disputed Otero’s argument that federal officials had appropriately corrected their error.

“Only once they received the video surveillance did they say, `Oh, it was a mistake,”‘ Larson said.

To read entire story, click here.

Joe Nelson, Staff Writer
Posted: 11/09/2011 05:33:36 PM PST

An attorney for Rancho Cucamonga developer Jeff Burum said federal officials on Wednesday returned all materials seized from Burum’s home and office during an FBI raid on Sept. 15.

“I can confirm that, pursuant to the stipulation between the parties and the subsequent order by the federal judge, the FBI has returned all materials that it seized at Mr. Burum’s residence and business offices,” Burum’s attorney Stephen Larson said.

Larson argued in federal court in the days following the raid that agents violated Burum’s civil rights when they erroneously declared in a search warrant affidavit they did a walk-through of Larson’s office, in Larson’s presence and with his consent, during the search.

In response, federal agents admitted to the error, chalking it up to an oversight, but stood by the integrity of their search.

To read entire story, click here.

BY IMRAN GHORI
STAFF WRITER
ighori@pe.com

Published: 08 November 2011 10:05 AM

Search warrants released as part of a San Bernardino County corruption case detail how the four-year investigation grew from reports of political gifts to allegations of a far-reaching conspiracy involving several top county officials and a prominent developer.

The warrants were ordered unsealed by Judge Michael Smith on Friday as part of the criminal proceedings against Rancho Cucamonga developer Jeff Burum, former county Supervisor Paul Biane, former assistant assessor Jim Erwin and Mark Kirk, former chief of staff to Supervisor Gary Ovitt. They face bribery and conspiracy-related charges for their alleged roles in a November 2006 legal settlement between Colonies Partners, Burum’s firm, and the county.

The 11 search warrants, covering the period from December 2008 to October 2010, were provided by prosecutors to defense attorneys last month. Six of the warrants were made available Friday with four more provided Tuesday.

One of the search warrants, from Aug. 4, 2009, remained unavailable. A court clerk said court officials were unable to locate the document as of Tuesday and are continuing to search for it.

The documents provide a glimpse into how the case began as an investigation into political dealings by former Assessor Bill Postmus and gifts Erwin received from Burum. They also describe the crucial role played by Adam Aleman, a longtime confidante of Postmus, as a confidential informant and the different tangents explored by district attorney’s investigators as the case grew.

Aleman, a former assistant assessor, pleaded guilty in July 2009 to vandalism, theft, destroying public documents and filing a false claim as part of a deal with prosecutors. In exchange for his cooperation, those felony charges could be reduced to misdemeanors when he is sentenced.

The first search warrant — from Dec. 2, 2008 — shows that Aleman cooperated with prosecutors as early as November 2008 when he met with Hollis Randles, a senior district attorney’s investigator, three times and told him about gifts Erwin received from Burum.

Erwin faces multiple perjury charges over allegations he failed to report a $12,750 Rolex watch, a private jet trip to New York and Washington, DC, plus dining, lodging and entertainment expenses paid for by Burum during the January 2007 trip.

Aleman told Randles that Burum took Erwin on the trip and gave him the watch as a gift for his help in facilitating the $102million settlement with Colonies, reached after a five-year legal battle over flood control easements at the firm’s Upland housing and commercial development.

Prosecutors contend that that the settlement was a result of bribery and extortion and that Colonies funneled $400,000 to political action committees controlled by Biane, Erwin, Postmus and Kirk as payment for yes votes on the settlement.

A January 2009 search warrant is the first indication that investigators were looking into the settlement and the contributions made to the political action committees. A subsequent search warrant, from March 2009, goes into more detail and is the first to raise the allegations that the contributions were bribes and recommend criminal charges against Burum, Biane, Erwin, Kirk and Postmus.

That March, Erwin was arrested on charges related to the gifts he received. Postmus had been arrested on drug charges in January 2009. It wasn’t until February 2010 that prosecutors charged them with bribery and conspiracy charges related to the settlement.

Aleman is the source of many of the allegations in the search warrants but the criminal charges against him are not mentioned in the first warrant, an omission that Erwin’s attorney, Rajan Maline, called troubling.

“What’s significant to me about the search warrant is the lack of information given to the magistrate,” Maline said.

He said it raises questions about the legality of the search warrants and may be the subject of a future court motion by him and other defense attorneys.

District attorney’s spokesman Chris Lee declined to comment on the issue.

To read entire story, click here.

Joe Nelson, The (San Bernardino County) Sun
Created: 11/07/2011 06:53:01 PM PST

The remaining search warrants served in a sweeping corruption probe involving a legal settlement between the county and a Rancho Cucamonga developer were released Monday.

The warrants were served between Dec. 2, 2008 and Oct. 22, 2010, in an investigation into the county’s landmark $102 million settlement with Rancho Cucamonga developer Colonies Partners LP in November 2006. They detail contributions made by the developer to political action committees following the settlement, as well as land deals involving former Board of Supervisors Chairman Bill Postmus and his business partner, John “Dino” DeFazio, who faces separate criminal charges for allegedly lying to a grand jury.

Former County Assistant Assessor of Support Adam Aleman provided the information to district attorney investigators as part of a plea bargain with prosecutors.

Aleman told investigators that Postmus, while serving as chairman of the Board of Supervisors, conspired with Colonies’ co-managing partners Jeff Burum to steer the settlement the developer’s way in exchange for bribes and political favors.

The settlement ended nearly five years of heated legal battle over flood-control easements at the developer’s 434-acre Colonies at San Antonio residential and Colonies Crossroads commercial development in Upland.

Burum, former county Supervisor Paul Biane; former Assistant Assessor Jim Erwin; and Mark Kirk, former chief of staff for Supervisor Gary Ovitt, are charged with conspiracy to commit a crime and conflict of interest, among other charges. They deny any wrongdoing.

A judge has dismissed five of seven counts against Burum, including bribery.

To read entire story, click here.

Bill Postmus and Jim Erwin

BY IMRAN GHORI AND DUG BEGLEY
STAFF WRITERS
ighori@pe.com | dbegley@pe.com

Published: 04 November 2011 09:59 AM

Search warrants released Friday provide more details of former San Bernardino County assessor and Supervisor Bill Postmus’ struggles with hiding his homosexuality and drug addiction as he was under scrutiny by authorities who suspected him of abusing his public office.

The documents also show that Jim Erwin, former assistant assessor for Postmus, used political action committees to help pay legal bills while he was under investigation. While not illegal, the practice caught the attention of investigators because of potential links to suspected bribery involving a Rancho Cucamonga developer.

Judge Michael A. Smith ordered 11 search warrants from the investigation unsealed Friday, about two weeks after they were provided to defense attorneys in the Colonies Partners corruption case by the district attorney’s office. The documents cover the period from December 2008 to October 2010.

The 264 page of documents include descriptions of what investigators sought and what they found, copies of checks, cell phone and computer records and investigative reports. Only six of the warrants were available Friday from the court clerk’s office; the rest are expected to be available Tuesday.

The district attorney’s office first began investigating Postmus in November 2007, looking into allegations he was using the assessor’s office for political purposes. He was arrested in January 2009 on drug charges and subsequently resigned. He initially faced charges of misuse of public office, but a year later the case was broadened to include charges of bribery related to the county’s $102 million lawsuit settlement in November 2006 with Colonies Partners. Postmus voted for the settlement while he was a county supervisor.

In May, a grand jury indicted Erwin, Colonies co-managing partner Jeff Burum, former county Supervisor Paul Biane, and Mark Kirk, former chief of staff to Supervisor Gary Ovitt, on bribery and conspiracy-related charges for their alleged role in the Colonies case. Among other allegations, prosecutors contend Colonies Partners funneled $400,000 to political action committees controlled by Biane, Erwin, Postmus and Kirk as payment for yes votes on the settlement.

The search warrants released Friday focus mainly on Postmus and Erwin during the early stages of the corruption investigation.

Postmus was among 45 witnesses who appeared before the grand jury, testifying that as chairman of the Board of Supervisors, he voted for the settlement because of promises from Burum to support him financially for the rest of his life and threats to expose him if he didn’t back the deal. He said he feared that Erwin, acting on behalf of Burum, would reveal that he was battling a methamphetamine addiction and was secretly gay.

The court documents include several pages of text messages and Internet chat records from a cell phone, Blackberry and computers seized from Postmus by investigators.

The night before his arrest at the court hearing, Postmus anticipated he could face further conspiracy charges, according to text messages. In the exchange with someone identified as “Jim,” Postmus speculates over recent developments in the criminal case.

“If they charge me, they better charge Jeff,” Postmus wrote the night before the hearing, alluding to Burum.

Other text messages and Internet chat records show numerous discussions – often explicit – of apparent attempts to arrange sexual trysts in exchange for money and to purchase drugs.

Postmus’ attorney, Stephen Levine, said prosecutors included those details to “malign his character,” noting that Smith ruled the evidence was inadmissible during Postmus’ preliminary hearing.

PACS Pay

The search warrants relating to Erwin focus primarily on financial records and a trip to New York he took with Burum in January 2007. As a result of that trip, prosecutors indicted Erwin on several felony perjury charges, accusing him of failing to report a $12,750 gold Rolex watch and other gifts on statement of economic interest forms government employees are required to fill out.

Patrick O’Reilly, who served as a consultant to Burum during the Colonies litigation and accompanied Burum and Erwin on the New York trip, has been named by prosecutors as an unindicted co-conspirator in the case.

To read entire story, click here.

Joe Nelson and Mike Cruz, The (San Bernardino County) Sun
Created: 11/04/2011 10:56:54 AM PDT

SAN BERNARDINO – Eleven search warrants served over a two-year period in a sweeping corruption probe tied to a legal settlement between the county and a Rancho Cucamonga developer were ordered released Friday by a Superior Court judge.

Read the documents: 1 | 2

(Disclaimers: Document #1 contains explicit language; pages containing private information have been removed from Document #2)

Judge Michael A. Smith ordered the search warrants released Friday after defense attorneys did not appear in court to object to their release or request redactions be made to the documents.

Six of the 11 warrants, which span from Dec. 2, 2008, to Oct. 22, 2010, were released. The remaining five are expected to be released early next week.

The documents provide a glimpse into the private life of former county assessor and former Board of Supervisors Chairman Bill Postmus.

A laptop computer, mobile phone and Blackberry seized from Postmus during searches by district attorney investigators turned up explicit communications between Postmus and men he met online, where Postmus solicited drugs and sex, according to the search warrants. On one occasion, Postmus, on the gay dating website Adam4Adam, allegedly offered a man $500 to spend the night with him.

Prosecutors have alleged that Rancho Cucamonga developer Jeff Burum was on the verge of using lurid details about Postmus’ private life against him in order to win a favorable settlement.

Investigators also turned up information showing that former Assistant Assessor Jim Erwin allegedly used at least three
political action committees to pay for legal expenses to Temecula-based attorney Alan Mohill.

One of the political action committees Erwin allegedly used to pay his legal expenses included the Committee for Effective Government, which prosecutors allege was used to funnel a $100,000 bribe to Erwin from Burum.

Erwin, Burum, former county Supervisor Paul Biane and Mark Kirk, former chief of staff for Supervisor Gary Ovitt, have been charged with conspiracy and conflict of interest, among other charges, in connection with the county’s Nov. 28, 2006, legal settlement with Rancho Cucamonga-based investor group Colonies Partners, LP, of which Burum is a co-managing partner.

State and local prosecutors allege the settlement was tainted by bribery and conspiracy. The FBI has since launched a separate investigation into the settlement.

In August, a Superior Court judge dismissed five of seven charges against Burum, including all bribery counts.

In March, Postmus struck a plea bargain with prosecutors and pleaded guilty to accepting a $100,000 bribe from Burum, in the form of two $50,000 contributions to political action committees he secretly controlled, in exchange for reduced charges.

To read entire story, click here.

Mike Cruz, Staff Writer
Created: 11/01/2011 06:25:06 PM PDT

In a rare move, federal prosecutors have agreed to return materials to a Rancho Cucamonga developer that were seized in September as part of an investigation into alleged corruption surrounding the $102 million lawsuit settlement between Colonies Partners LP and San Bernardino County.

The materials were seized by FBI agents serving search warrants at the offices and home of developer Jeff Burum, Colonies co-managing partner, and looking into alleged bribery and conspiracy related to the landmark 2006 settlement.

Stephen Larson, Burum’s attorney and a former federal judge, argued in the days after the Sept. 15 search that agents erred by taking documents and other materials not covered under the warrant.

The materials now will be returned as part of a written stipulation, or legal agreement, between Larson and federal prosecutors. The stipulation was signed Monday by U.S. District Judge S. James Otero.

Larson declined to comment.

The stipulation comes about three weeks after prosecutors admitted to providing incorrect information to a federal judge about the search of Larson’s office at the Diversified Pacific building in Rancho Cucamonga.

FBI agents erroneously told Judge Oswald Parada that they did a walk-through of Larson’s office, with Larson’s consent and in his presence, on Sept. 15. In a motion filed Oct. 11 in U.S. District Court in Riverside, prosecutors and agents admitted the information was incorrect.

On Tuesday, the U.S. Attorney’s Office said nothing in the agreement reached with Burum’s attorneys indicates the search was not properly conducted.

“We continue to maintain that the search was constitutional,” said Thom Mrozek, a spokesman for the U.S. Attorney’s Office in Los Angeles. “There’s nothing in the stipulation that suggests that the government is admitting, in any way, that the search was improper.”

Prosecutors will continue to oppose Burum’s motions in relation to the search warrant, Mrozek said.

To read entire story, click here.

Published: 01 November 2011 09:35 PM

The U.S. Attorney’s office will return materials seized in mid-September from Rancho Cucamonga developer Jeff Burum during an FBI search at his home and business, according to an order approved by a federal judge Monday.

The order – a result of a stipulated agreement between the U.S. Attorney’s office and Burum’s attorney – represents a reversal by federal officials who in court documents had defended the search as proper and initially rejected requests for Burum’s property to be returned.

As part of the order, the U.S. Attorney’s office also agreed to allow for the appointment of a special master to review material that Burum’s attorney believes is protected by attorney-client privilege and should not have been taken.

“The government’s unprecedented concessions constitute a tacit admission that its warrants are fatally flawed and its agents’ conduct was egregious,” Burum’s attorney, Stephen Larson, stated in a court motion, seeking to bar officials from using copies of the material seized during the searches.

That issue will be heard in U.S. District Court in Riverside on Nov. 10.

Federal agents stated in court papers that they had a separate team of attorneys to ensure that that no privileged material was taken, a procedure commonly followed in federal investigations.

Thom Mrozek, spokesman for the U.S. Attorney’s office, said the stipulation represents a compromise.

“It’s an agreement to advance the ball in litigation,” he said. “We continue to maintain the search was constitutional.”

To read entire story, click here.

Mike Cruz, Staff Writer
Posted: 10/24/2011 06:24:03 PM PDT

Nearly a dozen search warrants and their affidavits served by investigators probing the Colonies Partners LP $102million settlement with San Bernardino County were ordered unsealed Monday for defense lawyers.

Lawyers for Jeff Burum, co-managing partner of Colonies Partners LP, have been trying to secure release of the warrants since June as part of their effort to fight the criminal charges against their client.

Those charges are part of a sweeping criminal probe of alleged county corruption.

Judge Michael A. Smith granted the request Monday to unseal the warrants and affidavits to the defense lawyers at a hearing in San Bernardino Superior Court.

Prosecutors told the court they had copies of the 11 search warrants and their affidavits, dated from Dec. 2, 2008, to Oct. 22, 2010, for the defense at the District Attorney’s Office.

“These were some of the very early searches done in the investigation,” Deputy District Attorney Lewis Cope explained later outside of court.

He would not reveal the locations where the warrants were served.

When the judge initially unsealed the warrants and affidavits, Burum’s lawyer, Stephen Larson, expressed concern about their contents, saying they could include privileged or confidential matter.

Smith gave the defense until Nov. 4 to review the documents and prepare any motions to redact or argue against their release. If no opposition is heard that day, the warrants will be released publicly, Smith said.

Contacted later Monday, Larson had no comment about the judge’s ruling to release the warrants.

On May 9, the San Bernardino County criminal Grand Jury indicted Burum, former county Supervisor Paul Biane, former Assistant Assessor Jim Erwin and Mark Kirk, former chief of staff for Supervisor Gary Ovitt, as part of the county’s investigation into the landmark settlement.

The four defendants, who deny any wrongdoing, are accused of conspiring to secure the settlement in the developer’s favor in exchange for bribes and political favors.

Burum’s lawyers sought the warrants as part of a continued challenge of what they have previously described as the prosecution’s one-sided case.

To read entire story, click here.

A judge on Monday declined to bar more than 2,700 pages of Grand Jury transcripts in a criminal corruption probe from being used in a civil case involving San Bernardino County and three other public entities.

Attorneys representing the county filed a motion with the court in September attempting to block defendants in an indemnity lawsuit from using the transcripts in its defense.

The county sued San Bernardino Associated Governments (SanBag), Caltrans and the city of Upland in 2004, seeking to recover any damages that could arise from a separate land-rights lawsuit it was engaged in with Rancho Cucamonga developer Colonies Partners LP.

Colonies Partners sued the county in 2002, arguing the county abandoned its flood-control easements and refused to pay for flood-control improvements on its 434-acre residential and commercial development in Upland.

The county ultimately settled with the developer in November 2006 for $102million, a settlement prosecutors say was tainted by bribery and conspiracy.

Defendants in the indemnity case argue they are not liable for the damages, and that the county should be trying to recoup the $102million from Colonies Partners now that prosecutors allege the settlement was the result of corrupt influence.

The county, however, is pushing ahead in its efforts to get a court ruling on who was responsible for the design and construction of an Upland storm drain that diverted floodwater onto Colonies’ property adjacent the 210 Freeway, damaging it.

Presiding Judge Douglas Elwell ruled Monday in San Bernardino that an order in August by San Bernardino Superior Court Judge Michael A. Smith barring the release of privileged attorney-client information from third parties did not apply to the Grand Jury transcripts.

“(Smith’s) order simply said nothing about Grand Jury materials,” Elwell said.

To read entire story, click here.

Published: 24 October 2011 12:23 PM

A San Bernardino County Superior Court judge ruled Monday that he will not prevent about 2,700 pages of grand jury testimony in a corruption case from being used in a related civil case.

Judge Douglas Elwell said the question of whether the documents, which were unsealed in July, can be used in another court case is a decision for the civil case judge.

Elwell made the ruling during a court appearance by Rancho Cucamonga developer Jeff Burum, former county Supervisor Paul Biane, former Assistant Assessor Jim Erwin, and Mark Kirk, former chief of staff to Supervisor Gary Ovitt.

The grand jury heard four weeks of testimony from 45 witnesses and in May returned a 29-count indictment on conspiracy and bribery-related charges against Burum, Biane, Erwin and Kirk. Prosecutors have alleged that a $102 million settlement the county approved in November 2006 with Burum’s company, Colonies Partners, was a result of bribery and extortion.

The defendants have pleaded not guilty.

In a separate civil case, the county is suing the San Bernardino Associated Governments, Upland and Caltrans, alleging they had a role in causing flood basin problems at Colonies’ Upland housing and commercial development that led the company to sue the county. That case is being heard in San Diego County Superior Court and is tentatively scheduled to go to trial next April.

Last month, San Bernardino County lawyers asked for clarification as to whether the grand jury transcript and related exhibits can be barred from the civil trial. The county waived attorney-client privilege and allowed its attorneys to speak to the grand jury with the belief that the testimony could not be used beyond the criminal case, lawyer Jerome Friedberg said last month.

As part of the civil case, the county is defending the Colonies settlement, but during the criminal grand jury testimony several of its attorneys testified that they opposed the deal.

To read entire story, click here.

BY IMRAN GHORI
STAFF WRITER
ighori@pe.com

Published: 21 October 2011 07:10 PM

Prosecutors are arguing that a San Bernardino County Superior Court judge erred in tossing out some corruption charges against developer Jeff Burum and three former county officials, stating that they should be allowed to prove the allegations at trial.

In a motion filed Thursday with the state Fourth District Court of Appeal, the district attorney and state attorney general offices sought to restore the charges that were dismissed in August against Burum, former Supervisor Paul Biane, former Assistant Assessor Jim Erwin and Mark Kirk, former chief of staff for Supervisor Gary Ovitt.

A grand jury returned a 29-count indictment against the four in May, accusing them of taking part in a scheme to net Burum’s company, Colonies Partners, a $102 million legal settlement.

Prosecutors contend the deal, approved by the Board of Supervisors in November 2006, was a result of extortion and $400,000 in bribes by Burum and intermediaries acting on his behalf. The settlement ended a lengthy legal battle over flood-control improvements on a Colonies’ development in Upland.

Burum, Biane, Erwin and Kirk have pleaded not guilty.

In August, Judge Brian McCarville dismissed five of the seven counts against Burum and one count each against Biane, Erwin and Kirk after the defendants filed a demurrer, accusing prosecutors of overreaching and charging them with counts that should not apply to them.

Among the charges dismissed against Burum were four counts of aiding and abetting bribery after his attorney Stephen Larson argued that state law does not allow for the alleged briber to also be charged with aiding and abetting bribery.

But Deputy Attorney General Melissa Mandel stated in the prosecution brief that the law doesn’t necessarily exempt an accused briber of also being charged with aiding and abetting that crime, which she argued is a separate crime. In Burum’s case, he is accused of doing more than just offering and giving bribes, Mandel said.

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Joe Nelson, Staff Writer
Posted: 10/20/2011 03:12:49 PM PDT

The attorney representing Rancho Cucamonga developer Jeff Burum is asking a state appeals court to dismiss the remaining criminal charges against his client, who prosecutors charged in a sweeping county corruption probe.

In a petition filed with the Fourth District Court of Appeal in Riverside Tuesday, attorney Stephen Larson argued that San Bernardino Superior Court Judge Brian McCarville should have dismissed conspiracy and conflict-of-interest charges against Burum, in addition to five other charges that he did dismiss, during an Aug. 19 hearing.

McCarville also dismissed one felony count of misappropriation of public funds against three former county officials in a sweeping corruption case in which prosecutors allege the county’s $102 million legal settlement in November 2006 with Burum’s development consortium, Colonies Partners LLP., was tainted by bribery and blackmail.

On May 9, a criminal Grand Jury indicted Burum; former county Supervisor Paul Biane; former Assistant Assessor Jim Erwin; and Mark Kirk, former chief of staff for Supervisor Gary Ovitt, on charges of conspiracy and conflict of interest, among other charges.

Attorneys for Erwin and Kirk also filed petitions for writs of mandate Tuesday in the Riverside appellate court seeking dismissal of some of the charges against their clients. They did not return phone calls seeking comment.

Biane’s attorney did not file a petition, according to online court records.

Larson declined to comment Thursday.

The defense attorneys’ actions come amid an appeal by state and local prosecutors of McCarville’s Aug. 19 rulings.

Prosecutors are seeking the reinstatement of the dismissed charges, while defense attorneys are seeking more dismissals.

On Thursday, prosecutors filed an opening brief on their appeal, court records show.

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Joe Nelson, The (San Bernardino County) Sun
Created: 10/17/2011 02:10:43 PM PDT

Jim Erwin
The attorney defending former San Bernardino County Assistant Assessor Jim Erwin in a sweeping corruption probe is alleging that an FBI search of Erwin’s home was flawed and that Erwin’s civil rights were violated.

A motion filed by attorney Rajan Maline in U.S. District Court in Riverside on Oct. 11 is the second to be filed in the last three weeks challenging the strength of the Sept. 15 FBI raid in connection with an investigation into the county’s $102 million legal settlement with Rancho Cucamonga developer Colonies Partners LP in November 2006.

On Oct. 3, attorney Stephen Larson, who represents Colonies’ co-managing partner Jeff Burum, filed a motion with the court alleging Burum’s civil rights were violated and FBI agents essentially lied to him and in an official court document, tainting the search altogether.

Federal prosecutors dispute Larson’s claims. They argue in a motion filed in response to Larson’s that the search was conducted above-board and that an error in a court document was a mere oversight and unintentional.

Erwin, Burum, former county Supervisor Paul Biane and Mark Kirk, former chief of staff for Supervisor Gary Ovitt, face criminal charges in a joint prosecution by the state Attorney General’s Office and the District Attorney’s Office.

State and county prosecutors allege the four conspired to steer the landmark settlement in Colonies’ favor in exchange for bribes and political favors.

The settlement ended nearly five years of legal battle over flood-control improvements at Colonies’ 434-acre residential and commercial development in Upland, Colonies at San Antonio and Colonies Crossroads, respectively.

All four defendants deny any wrongdoing.

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Joe Nelson, Staff Writer
Created: 10/08/2011 08:36:40 PM PDT

Grand Jury testimony given by Rancho Cucamonga developer Jeff Burum in 2009 could prove beneficial to his defense and should have been provided to a criminal grand jury in April, according to Burum’s attorney.

The transcripts, released last week, detail Burum’s March 2009 testimony before the county’s civil Grand Jury in which he described how attorneys for his firm, Colonies Partners LP, impeached nearly every witness called by San Bernardino County’s lawyers in the months leading up to the county’s decision to settle with Colonies.

In testimony, Burum said attorneys representing the county were giving the Board of Supervisors bad advice and telling them they were winning in court despite evidence to the contrary, according to the 130-page transcript.

“It is fundamentally unfair and, in our view, contrary to the law, that the grand jury was not provided with copies of Mr. Burum’s testimony prior to being asked to return the indictment,” Burum’s attorney, Stephen Larson, said in a telephone interview.

None of Burum’s 2009 testimony was provided to a special criminal grand jury, which indicted Burum and three former county officials, including former Colonies consultant Jim Erwin, in May on charges of conspiracy, bribery and conflict of interest, among other charges. Prosecutors allege the county’s landmark $102 million settlement with Colonies Partners in November 2006 was tainted by bribery and extortion. A federal investigation is under way as well.

Five of the seven charges against Burum, including all bribery-related charges, were subsequently dismissed after a judge determined the criminal statutes used to charge Burum were either erroneously applied or the statute of limitations had lapsed for charging Burum with such crimes. Judge Brian McCarville also dismissed one felony count of misappropriation of public funds against the other three defendants – former county Supervisor Paul Biane, former assistant assessor and union boss Erwin and Mark Kirk, former chief of staff for Supervisor Gary Ovitt.

During his 2009 testimony, Burum laid out his interpretation of the nearly five-year legal battle over who was responsible for flood-control improvements at Colonies’ Upland development, which resulted in two Superior Court rulings in the developer’s favor.

“I’m going, `Are they in the same courtroom I’m in, because they’re getting killed every day?”‘ Burum said during his testimony.

He said Colonies made strong headway during the 2006 trial, and the county resorted to having a witness go on the stand and attack his character.

Burum said what made him angriest – when he broke off communication with county supervisors – was when the county forced him to build a flood control basin on Colonies’ property with enough storage capacity to protect residents from a 100-year flood, then reversed its position after the trial court ruled the basin’s construction was the county’s responsibility.

On appeal, the county unsuccessfully argued that the basin was not needed, and that its existing earthen berm easement was sufficient. The county requested construction on Colonies’ property be halted until the conclusion of litigation, a move Burum said was an attempt to bankrupt Colonies and force and end to the lawsuit.

The judge denied the county’s motion for a stay on the construction of the basin, allowing Colonies to proceed with the second phase of its residential development, Colonies at San Antonio.

Settlement encouraged

As the trial moved forward, so did settlement talks between the county and Colonies’ attorneys. Burum said during his testimony that he pushed to settle the lawsuit for a discounted value, despite what he said could have been upwards of a $750 million judgment that could have bankrupted the county had it lost to in court.

Though initial damage estimates by Burum’s camp ranged between $250 million to more than $300 million, efforts were under way in 2006 to change state law so that when the government abused a private property owner the government was held to the same standards as the private sector. As to damages, that would mean three times the amount of whatever the jury awarded.

“So … if we continued down the road at ($250 million), the verdict against the county could be a $750 million verdict against the county, which would bankrupt the county,” Burum said during his testimony. “Everyone in political circles also knew this. This was a hotly contested issue.”

Holiday in New York

Much of Burum’s testimony was spent justifying his relationship with Erwin and a January 2007 trip to New York City, where Burum treated Erwin and Riverside publicist Patrick O’Reilly, whom Burum also referred to as his best friend, to a night on the town. Prosecutor Lewis Cope referred to the trip as a “holiday in New York.”

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