A Beverly Hills developer was sentenced Thursday to four years in prison for bribing a Los Angeles County official in what prosecutors said was one of the biggest corruption cases in LA history.
Arman Gabaee, 61, admitted making dozens of cash payouts to a county official in clandestine meetings in cars, restaurants and men’s restrooms in exchange for lucrative real estate leases.
The developer also offered to buy Officer Thomas J. Shepos a $1 million home in exchange for the county spending $45 million to lease office space on a lot in Gabaee in Hawthorne .
U.S. District Judge George H. Wu denied the government’s request for a nine-year sentence, but agreed with the recommendation of a $1.1 million fine that Gabaee must pay by the end of March. Wu called the case an example of “systemic” public corruption.
“There’s so much going around,” the judge said.
The developer, also known as Gabay, told Wu that his payouts to Shepos were “an isolated situation that I am very, very ashamed of and very embarrassed about.”
“I understand I did something wrong and I beg your indulgence,” he said.
Gabaee was a co-founder and co-CEO of The Charles Co., a Hollywood development company. He pleaded guilty to bribery in May.
“This is one of the largest corruption cases in the history of this district,” said Assistant US Atty. Lindsey Greer Dotson told Wu when she spoke out in favor of a tougher sentence on Thursday.
Citing FBI wiretapping devices that point to Gabaee’s potentially corrupt dealings with other officials, she said, “This was just a tiny sampling of how this defendant is conducting business.”
“I don’t know if I can go that far,” Wu replied.
From 2010 to 2017, Gabaee paid Shepos $1,000 a month in exchange for land leases, attractive lease terms, non-public information, and other benefits.
As a senior official in the county’s real estate department, Shepos negotiated leases between property owners and the county. The rental agreements were approved by the Supervisory Board.
In December 2016, Shepos began working with the FBI, who soon recorded him accepting more bribes from Gabaee. Shepos pleaded guilty in 2018 to making false statements about bribes to the FBI and signing a false 2014 tax return.
Gabaee was recorded offering Shepos a million-dollar home in Northern California’s wine country in exchange for a 10-year lease that would make LA County the anchor tenant of his Hawthorne Mall property.
Gabaee quickly moved to sell the property, saying the $45 million long-term lease from a reliable tenant has boosted the property’s market value from $17 million to $500 million overnight, according to the government.
“His seven-year streak of monthly bribes, culminating in a massive million-dollar bribe, wasn’t [born] of financial or emotional despair—but immense, willful, and almost unfathomable greed,” Greer Dotson and Assistant US Atty. Thomas F. Rybarczyk wrote in a memo to the court. “He had everything, and yet it was never enough.”
Several dozen family members and friends of Gabaee attended the sentencing hearing. Some of them sobbed loudly after Gabaee was sentenced to four years in prison. According to Robert Shapiro, his attorney, about 150 backers wrote letters to the judge asking leniency for Gabaee, including some thanking the developer for the charitable donations.
Shapiro asked for 18 months of house arrest and no jail time for Gabaee. He urged Wu to give credit to Gabaee for his redevelopment of properties in impoverished parts of South LA
“Arman deeply regrets his stupid and self-destructive decision to make illegal payments to Tom Shepos,” Shapiro and other attorneys for Gabaee said in a memo to Wu.
“His sincere hope is that the court will weigh this error against his remarkable track record of investing downtown and providing prime real estate for rent to the community as a whole.”