Law Enforcement

FOR IMMEDIATE RELEASE
January 23, 2009
Contact: Christine Gasparac(916) 324-5500

Attorney General Brown Files Criminal Charges in $52 Million Ponzi Scheme

ORANGE COUNTY – Attorney General Edmund G. Brown Jr. yesterday filed 89 criminal charges against 6 men who “callously conned” more than a thousand people, including retired senior citizens, out of $52 million through sham real estate projects, using the investors’ money to buy planes, expensive cars and lavish vacations.

“These six men callously conned hundreds of people into investing $52 million into a company that they treated as their personal bank account,” Attorney General Brown said. “They fraudulently took investors’ money and spent it on an array of luxury items, relying on a Ponzi scheme to keep investors at bay.”

From 2001 to February 2006, Irvine-based Carolina Development Company peddled $52 million worth of stock to more than a thousand investors. The company claimed the proceeds would be used to buy and develop luxury resorts and upscale communities adjacent to golf courses designed by Arnold Palmer, Jack Nicklaus, and Greg Norman. Investors bought anywhere from $15,000 to $1 million in stock, including senior citizens who invested their retirement funds. The company bought some land, but did nothing to develop it, despite its claim that 85% of the $52 million invested would be used for land acquisition and development.

To persuade investors to buy shares of Carolina Development Company, the defendants claimed that Arnold Palmer had partnered with them. The defendants promised that investors would reap huge dividends and assured those who invested a minimum of $100,000 that their investment would be secured by deeds to specific parcels of land. None of these claims were true.

The defendants diverted more than $24 million for extravagant bonuses, personal medical bills, airplanes, fancy meals, BMWs, concert tickets and luxury vacations. To keep investors at bay, the defendants engaged in a Ponzi scheme, paying some investors “returns” on their investment using money from the new investors.

Department of Justice agents served arrest warrants against the following six defendants, who were charged with grand theft and securities fraud in Orange County Superior Court:

Lambert Vander Tuig, 50, of Santa Margarita, currently held in the Orange County Sheriff’s Department.

Jonathan Carman, 45, of Laguna Hills, currently held in the Orange County Sheriff’s Department.

Mark Sostak, 50, of Ladera Ranch, currently held in the Orange County Sheriff’s Department. Bail is set at $4.5 million.

Scott Yard, 47, of Costa Mesa, remains at large.

Soren Svendsen, 43, of Coto De Caza, is currently being held in the Orange County Sheriff’s Department. Bail is set at $2.2 million.

Robert Waldman, 48, is scheduled to turn himself in to authorities.

On Wednesday, representatives of the Attorney General’s Office obtained arrest warrants from Orange County Superior Court Judge Selim Franklin.

These criminal charges were preceded by civil actions brought by the U.S. Securities and Exchange Commission (SEC). The SEC in 2007 won a $29.2 million judgment against Lambert Vander Tuig, the president of the company, and a $2.1 million judgment against Jonathan Carman, vice president of the company.

If convicted, defendants Vander Tuig and Carman could receive sentences in excess of 10 years in state prison. The remaining defendants would be subject to lesser prison sentences.

The criminal complaint and affidavit are attached.

EL DORADO COUNTY, CALIF–Attorney General Edmund G. Brown Jr. today announced that local, state and federal law enforcement agencies served 10 search warrants and 5 arrest warrants in El Dorado and Nevada Counties to shut down a “major illegal marijuana-growing operation” operating in northern California.

“Today, we shut down a major illegal marijuana-growing operation,” said Attorney General Brown. “This illegal operation consisted of thousands of marijuana plants worth millions of dollars and protected by handguns, shotguns and rifles. These illegal growing operations are a threat to public safety.”

In the course of today’s crackdown, agents seized approximately 2,100 marijuana plants and 100 pounds of processed marijuana, plus indoor marijuana-growing equipment, such as lights and generators. Agents also found approximately $625,000 in U.S. currency and seized 2 handguns, 3 rifles and 5 shotguns. Several of the weapons seized were loaded.

The 2-month investigation began in September 2008, after agents observed an outdoor marijuana cultivation operation in Pollock Pines. Agents found that in the past 4 years, the suspects had spent millions of dollars on properties in El Dorado, Nevada, Placer, Mendocino, Sacramento, Alameda, and San Francisco Counties. During the investigation into these properties, agents discovered large indoor marijuana cultivations in El Dorado County.

Law enforcement agents detained several individuals. Any individuals arrested today will face federal charges of conspiracy to manufacture/cultivate marijuana.

Today’s arrests were part of a multi-agency operation involving more than 200 law enforcement personnel from the California Department of Justice’s Bureau of Narcotic Enforcement, California Highway Patrol, El Dorado County Sheriff’s Office, Elk Grove Police Department, Mountain and Valley Investigation Team, Nevada County Sheriff’s Office, Placer SIU, Sacramento City Police Department, Sacramento County Sheriff’s Office, SLEDNET, U.S. Forest Service, West Sacramento Police Department, Woodland Police Department, and Yolo County Sheriff’s Office.

SAN FRANCISCO– California Attorney General Edmund G. Brown Jr. today urged the United States Court of Appeals for the Ninth Circuit to reverse a lower court decision requiring California to make a $250 million down-payment on a massive $8 billion prison-construction project, arguing that the decision is in “blatant violation” of federal law.

“This decision is in blatant violation of federal law, which forbids federal judges from ordering states to build new state prisons,” Attorney General Brown said. “This is particularly unacceptable at a time when California is facing a $25 billion deficit,” Brown added.

Brown also called on the Federal appeals court to order the release of hundreds of pages of secret documents that are contained in an earlier version of the Receiver’s plan.

While Federal Prison Receiver Clark Kelso has acknowledged that his project “will result in the construction of 7 million square feet of new medical facilities—the equivalent of 70 Wal-Mart stores,” he has released to the public only one version of his plans. An earlier version -- which describes in graphic detail important elements of the $8 billion construction program -- has been kept under court seal.

Attorney General’s Filing

In August of this year, the court appointed Receiver filed a motion seeking to compel Governor Arnold Schwarzenegger and Controller John Chiang to allocate $8 billion from the California Treasury over the next 5 years, including $3 billion in this fiscal year, for prison healthcare facility construction. Attorney General Brown has argued that the federal court does not have the legal authority to mandate state prison construction, nor has the Receiver justified the massive sums called for in his plan.

“In ordering the state to fund the Receiver’s massive prison construction program, the district court clearly violated federal law, and its decision must be reversed,” Attorney General Brown wrote in his filing to the U.S. Court of Appeals for the Ninth Circuit.

The Prison Litigation Reform Act (PLRA), approved by Congress in 1996, bars federal courts from ordering states to fund state prison construction.

The Receiver’s $8 billion demand includes construction of 7 new prison healthcare facilities containing 10,000 new beds for prisoners with acute and long-term health needs. The plan would also improve healthcare and mental health facilities at each of the 33 existing state prisons.

The State of California has acknowledged the need to provide constitutionally adequate healthcare. The state, however, argues that the Receiver has not complied with the Prison Litigation Reform Act, which requires that any prison remediation plan that a court orders “is narrowly drawn, extends no further than necessary to correct the violation of the Federal right, and is the least intrusive means necessary to correct the violation of the Federal right.” (18 U.S.C. § 3626(a)(1)(A)).

State Has Made Progress on Health Care

One of the fundamental problems in fulfilling the state’s constitutional healthcare mandate was the lack of qualified medical staff to treat the inmates. According to his own reports, the Receiver will have 90% of nursing and physician positions filled by January 2009, up from 50% when he was appointed.

The Receiver has also begun to change the process by which inmates are assessed and how they are treated, actions which address the deficiencies that led to appointment of the Receiver.

These steps have significantly improved the level of care provided to prisoners.

RICHMOND—California Attorney General Edmund G. Brown Jr. and Richmond Police Chief Chris Magnus today announced the arrests this morning of 18 gang members of the dangerous Deep Central criminal street gang that has been “wantonly terrorizing” Richmond for the last five years.

“This notorious street gang has been wantonly terrorizing the neighborhoods of Richmond with robberies, prostitution, drug trafficking and even murders,” said Attorney General Brown. “Just last year, more than 20 homicides in the city resulted from the gang war between Deep Central and the Project Trojans.”

In response to the 47 homicides in Richmond last year—the highest per-capita murder rate in California—Attorney General Brown authorized the gang investigation that resulted in today’s major gang takedown. Formed in 2003, the Deep Central gang, also known as Deep C, includes an estimated 100 members who claim Richmond as their territory. The gang is one of the largest and most violent criminal street gangs in Richmond, engaging in drug trafficking, robbery, assault and prostitution. Residential neighborhoods are often ground zero for some of the gang’s most violent activity.

At approximately 7 a.m. this morning, more than 200 state, local and federal law enforcement personnel served 40 search warrants and 43 arrest warrants in Alameda County, Contra Costa County, Marin County, and Sacramento County. In addition to the arrests, agents seized substantial quantities of cocaine and marijuana, with an estimated street value of $100,000. Agents also seized 8 firearms, including a fully automatic weapon, a ballistic vest and more than $17,000 in cash. One of the gang associates arrested in today’s operation, Kaisha Hill, was a City of Richmond Parks and Recreation juvenile group counselor who had a stash that included a kilo of cocaine and 3 guns, one of which was a Mac-11 automatic weapon.

The Attorney General’s investigation began after two of the gang’s leaders, Todd Gillard and Rohnell Robinson, attempted to kill a rival gang member in a drive-by shooting at Hilltop Mall in Richmond. Gillard and Robinson instead shot the rival’s 17 year-old girlfriend in the neck, leaving her a quadriplegic. At a grand jury trial, Gillard and Robinson were both indicted for attempted murder and are in custody, awaiting trial. Prior to his arrest, Gillard was identified as the “shooter” in at least two other drive-by shootings with rival gang members in residential neighborhoods in Richmond.

Narcotics agents from the Attorney General’s Office led today’s operation in conjunction with the Richmond Police Department. During the course of the investigation, arrests were made for homicide, assault with a deadly weapon, grand theft, shooting at a vehicle, possession for sale of marijuana, possession for sale and transportation of cocaine, possession of an assault weapon, and prostitution.

Other law enforcement agencies participating in today’s operation include the Contra Costa Sheriff’s Office, Federal Bureau of Investigations, West Contra Costa County Narcotic Enforcement Team, Central Contra Costa County Narcotic Enforcement Team, Napa Special Investigations Bureau, Marin County Narcotic Task Force, Elk Grove Police Department, and Rancho Cordova Police Department.

The Attorney General’s Office assists local law enforcement when severe gang problems cross jurisdictional boundaries. State agents have recently shut down a Norteño street gang and a violent Cambodian street gang in Stockton, a Sureño gang in Atwater and the Varrio Central Poros, a brutal criminal street gang that terrorized the City of Porterville for years. Brown’s special agents have also participated in recent crime crackdowns in East Palo Alto, Oakland, and Compton

YUBA CITY— California Attorney General Edmund G. Brown Jr. announced today that officers from the Attorney General’s Office, Yuba County Sheriff’s Department and Sutter County Gang Task Force conducted “Operation Showdown” and arrested 25 people for gang activity, drug trafficking and illegal gun sales.

“Tragically, gang activity is deeply embedded in many communities and is spreading throughout rural California,” said Attorney General Brown. “Despite the state’s budget crisis, I intend to do everything I can to help local police and sheriffs curb the escalating gang violence plaguing our state.”

During Operation Showdown, undercover officers infiltrated drug-trafficking groups involved in the distribution of drugs and the illegal sale and transfer of firearms. During a three-month period, undercover officers made more than 50 drug buys and 5 gun buys from 42 people, including 8 gang members, 13 gang associates and 5 parolees. The undercover officers purchased more than 300 grams of methamphetamine and were also able to purchase heroin, marijuana and 8 guns, including 2 assault weapons. Three of the guns purchased in the operation were stolen in a burglary in Yuba County.

Operation Showdown led to the arrest of 25 suspects, including 6 gang members and 8 gang associates. Agents seized more than 3,500 grams (almost 6 pounds) of methamphetamine, 18,000 grams (42 pounds) of marijuana, 21 guns, heroin and more than $101,000 in cash. One of the search warrants yielded 186 gigantic marijuana plants capable of producing up to 8 pounds of marijuana buds per plant.

The Attorney General’s Office assists local law enforcement when severe gang problems cross jurisdictional boundaries. State narcotics agents have recently shut down a Norteño street gang and a violent Cambodian street gang in Stockton, a Sureño gang in Atwater and the Varrio Central Poros, a brutal criminal street gang that terrorized the City of Porterville for years. Brown’s special agents have also participated in recent crime crackdowns in East Palo Alto, Oakland, and Compton.

LOS ANGELES—California Attorney General Edmund G. Brown Jr. today announced the arrests of three members of a fraud ring who preyed on desperate Southern California homeowners by falsely promising to renegotiate their home loans, but instead “ripped them off for thousands of dollars” while their homes fell into foreclosure.

“It’s appalling how these scammers took advantage of desperate homeowners and ripped them off for thousands of dollars,” Attorney General Brown said. “Our campaign against mortgage scams masquerading as foreclosure assistance will continue and even intensify.”

California Department of Justice Special Agents of the Bureau of Investigation and Intelligence arrested Rosa Conrado of San Bernardino, Saul Amador of West Covina, and Jesus Flores of Baldwin Park, believed to be members of the fraud ring. Law enforcement officers have issued arrest warrants for Juan Perez of Grand Terrace, and David Giron of Ontario, who are also suspected to be involved in the scheme. The Attorney General’s Office filed a 39-count complaint that includes multiple grand theft, money laundering and conspiracy charges against these suspects.

The arrests came after an investigation into First Gov, also operating as Foreclosure Prevention Services, uncovered that the company was soliciting hundreds of homeowners with mail flyers offering to help them stop the foreclosure process on their homes. The scammers falsely told homeowners that they would renegotiate their mortgages, reduce monthly payments, and transfer any delinquent loan amounts to the renegotiated principle. The company demanded an up-front fee, ranging from $1,500 to $5,000, to participate in the loan-modification program. The company also told the victims to stop any mortgage payments or communications with their lender, claiming they would interfere with the company’s effort to negotiate the loan modification.

When victims complained that they were still receiving delinquency or foreclosure notices from their lenders, fraud-ring members told the victims that the mortgage loans had been renegotiated, but the lenders needed a “good faith” payment to secure the new accounts. Homeowners made payments to accounts under business names such as “Reinstatement Department” or “Resolution Department” that made it appear as if the payment had been applied toward the loan. Bank records indicate that more than $700,000 was stolen from homeowners who fell victim to this scheme.

Typically, the scam initiated with a flyer sent to the homeowner. For example, Eleuteria and Arthur Washington of Redlands responded to a flyer she had received that falsely claimed to offer a way to renegotiate their home loan. On May 16, 2007, a representative of First Gov came to their residence. The Washingtons were asked for two cashier’s checks each for $2,023.58 (totaling $4,046.56), which equaled two times the combined total of the monthly payment on their first and second mortgage.

Although the checks were deposited that same day into the designated Bank of America account, Mrs. Washington continued to receive letters from her lenders that the house would be auctioned. Mrs. Washington’s numerous calls to First Gov went unanswered. Finally, she received a call from First Gov that her lenders had agreed to the loan modification.

The next day, Mrs. Washington received another call from First Gov that the new loan documents would be sent to her to sign. She was told the lender wanted an additional payment and was instructed to make a deposit to Washington Mutual for $2,023.58. After Mrs. Washington made the deposit, she never heard from First Gov again. She later learned from her lender that the loan was never renegotiated, and the lender had never heard of First Gov. As a result of the scam, the Washingtons were cheated out of more than $6,000.

California homeowners should be aware the fraud ring’s flyer is still being circulated. The flyer is printed on goldenrod-colored paper in a yellow envelope. Occasionally, the contact name and number that appear on the bottom are changed. A copy of the flyer and mailing envelope are attached.

“Loan-modification scams are becoming more and more prevalent across the country, particularly in California,” Attorney General Brown said. “California homeowners should be aware of the warning signs of foreclosure scams, so they don’t fall victim to these cynical schemes.”

Today’s arrests are part of the California Attorney General’s ongoing crackdown on predatory lending and mortgage-fraud schemes in the state. In March, the Attorney General’s Office arrested Eric Pony and other members of Lifetime Financial Corporation for leading a similar mortgage-renegotiating scam that stole hundreds of thousands of dollars from California homeowners. Pony led the company in a predatory bait-and-switch loan-modification scam that targeted elderly and non-English speaking homeowners. The case is still pending in Los Angeles Superior Court.

Earlier this month, the California Attorney General’s Office secured $8.6 billion in loan relief for eligible homeowners in a landmark settlement with Countrywide Financial Corporation for engaging in deceptive and predatory lending practices that led many California families to lose their homes.

Homeowners considering paying for foreclosure-assistance services, such as loan modification, should beware of anyone who tells them not to contact their lender or charges an upfront fee. It’s unlawful for companies that promise to help consumers in foreclosure to collect any money from them before they've done what was promised. Also, consumers should remember that they may not transfer title on their property to avoid foreclosure without the consent of their lender.

Copies of the complaint and arrest warrants are attached.

Frequently Asked Questions regarding the foreclosure process and foreclosure scams are also attached.

FOR IMMEDIATE RELEASE
October 31, 2008
Contact: Michelle Gregory (916) 869-0413

SAN DIEGO–California Attorney General Edmund G. Brown, Jr. today announced the arrests of three key gang members from the V-Boys and Tiny Oriental Crip gangs, two violent Southeast Asian street gangs “terrorizing California’s cities and towns.”

“We can never let up in our relentless campaign to crack down on the street gangs that are terrorizing California’s cities and towns,” said Attorney General Brown. “With the takedown of these key members of the V-Boys and Tiny Oriental Crip gangs, we’ve made significant progress in our work to make our streets safer for everyone.”

Starting at 7:00 a.m. yesterday morning, California Department of Justice Gang Suppression and Enforcement Team (GSET) agents joined other state and local law enforcement agencies in serving search warrants in two counties and arresting three leaders of the “V-Boys” and “Tiny Oriental Crip” street gangs. Both gangs have a long history of violence in San Diego County, but several of the gang leaders have relocated and now live in the Temecula Valley area of Riverside County.

The investigation started in November 2006, when GSET agents learned that the San Diego-based street gangs were active in the southwest portion of Riverside County. Prior to yesterday’s takedown, police have already arrested 27 gang members and their associates for murder, robbery, burglary, identity theft and other crimes.

The California Department of Justice (DOJ) and the Riverside County District Attorney’s Office, with the assistance of the San Diego Police Department’s Street Gang Unit and Mid-City Division and the Murrieta Temecula Regional Gang Task Force, served 7 search warrants on the Southeast Asian street gangs. Agents made 3 arrests and seized weapons, including rifles, a sawed-off shotgun, semi-automatic handguns, and a cache of ammunition. Agents also seized a Tech-9 machine pistol with the serial number filed off and night-vision equipment. Agents plan to seek additional arrest warrants for several suspects who were not found during the operation.

The gang demonstrated its potential for violence during a surveillance operation in November 2007. While agents were conducting surveillance on a suspect, Tri Minh Vo, the suspect and his companion, Cao Lam, entered a home in City Heights, a community in San Diego. They shot six people in the home, killing one of them. When the surveillance team and members of the San Diego Police Department’s Gang Suppression Team confronted the suspects, Cao Lam fired at the officers and struck a DOJ agent. Tri Minh Vo was taken into custody at the scene. Cao Lam fled on foot while continuing to fire at the responding officers. During the pursuit, Cao Lam was shot by officers and died of his wounds. The wounded DOJ agent has since recovered from his gunshot wound.

The California Department of Justice GSET program assists local law enforcement with severe gang problems that bleed into neighboring jurisdictions. State agents have recently shut down a Nortenos street gang, a violent Cambodian street gang in Stockton, and a Sureño gang in Atwater. Attorney General Brown’s special agents have also participated in recent crime crackdowns in East Palo Alto, Compton and Oakland.

LOS ANGELES –Attorney General Edmund G. Brown Jr. today announced that California Department of Justice special agents, assisted by the FBI, brought down an illegal gambling ring on Wednesday which took bets on the winning numbers of the California Daily 3, paid out the cash and hoarded the profits.

“The California State Lottery helps to fund education for millions of children in California,” Attorney General Brown said. “It should not be exploited by criminals for their own personal gain. I want to thank the FBI for working with my office to put an end to this illicit scheme.”

The 18-month joint investigation found the organization sold lottery tickets in Los Angeles, Long Beach, San Gabriel, and the San Joaquin Valley. The gambling ring took bets on number combinations based on the “California Daily 3” and would pay all winning bets, and retain the remainder as profit. It is estimated that several thousand people placed bets daily on each game.

The ring is suspected of making a profit of around $500,000 to $1 million dollars per month. Prior law enforcement investigations have shown this type of scheme can generate over $800,000 in illegal profits per month.

Profits from the California State Lottery “California Daily 3” are used to fund education and other programs in the State of California. It is illegal for private groups to collect bets and money based on games from the California State Lottery.

On October 8, 2008, state agents and the FBI concluded the multi-jurisdictional investigation with the assistance of the California State Lottery, Modesto Police Department, and Stockton Police Department. The investigation culminated with the service of seven federal search warrants and four arrest warrants in the Modesto, Stockton, and Los Angeles areas.

Evidence seized from the search warrants included documents, interview statements, and proceeds of the illegal gambling business totaling approximately $65,000 in U.S. currency and $103,000 in cashiers checks.

The following people were arrested as a result of the investigation:

Somachy Ray Keo, 48, of Modesto, CA;

Pang Yean, 66, of Modesto, CA;

Kanary Khin, 55, of Long Beach, CA;

Saret Gul Nosar, 57, of Los Angeles, CA.

The suspects were arrested for violation of Title 18 United States Code 1955 for conducting an illegal gambling business in the eastern and central districts of California, and were turned over to the custody of the U. S. Marshall’s Office.

LOS ANGELES--California Attorney General Edmund G. Brown Jr. today announced a crackdown on rampant prescription drug fraud in California, including the top fifty abusers who average more than 100 doctor and pharmacy visits to collect massive quantities of addictive drugs like Valium, Vicodin, and Oxycontin.

“These prescription drug addicts are abusing the system, draining time and money from hundreds of doctors and pharmacies who are there to help real sick people, not con artists,” said Attorney General Brown. “On my order, California Department of Justice special agents launched a statewide search for the most aggressive prescription drug addicts. We want to end these dangerous cycles of fraud and abuse.”

Launched in June this year, the new crackdown has already led to the arrest of dozens of suspects, including Frankie Greer, 53, who visited 183 doctors and 47 pharmacies to feed a prescription drug habit that included some of the most dangerous painkillers in lethal combinations. In a one-year period, Greer sought out multiple doctors at hospital emergency rooms to prescribe her over 4,830 hydrocodone tablets, 2,210 oxycodone tablets, 156 Oxycotin, along with a variety of additional addictive painkillers.

Greer is not alone. The National Survey on Drug Use and Health estimates that 20 to 30% of the state’s drug abusers primarily use prescription drugs. In addition, the National Institute on Drug Abuse has estimated that 48 million Americans have used prescription drugs for non-medical reasons. A 2005 survey by the Drug Abuse Warning Network estimates the non-medical use of pharmaceuticals accounted for more than 500,000 emergency room visits in California, an enormous drain on the state’s healthcare system.

In addition to costing the state millions each year, prescription drug abuse can have serious public safety consequences, as many of the top abusers hold down regular jobs including truck drivers, transit operators and medical practitioners. The Attorney General has been working in cooperation with the Troy and Alana Pack Foundation, founded by Bob Pack, whose 7 and 10-year old children were killed by a driver who was under the influence of prescription drugs obtained from multiple doctors.

This initiative is part of the Attorney General’s comprehensive plan to address prescription drug abuse in the state and make it easier for doctors to keep track of prescription drug records. Earlier this year, Attorney General Brown unveiled a plan to provide doctors and pharmacies with real-time Internet access to patient prescription drug histories. Under Brown’s proposal, health professionals would have computer access to the drug histories of patients, replacing the current outdated system that required mailing or faxing written requests for information. Each year, more than 60,000 such requests are made to the California Department of Justice.

The state’s database, known as the Controlled Substance Utilization Review and Evaluation System, contains 86 million entries for prescription drugs dispensed in California, giving healthcare professionals the technology they need to fight the prescription drug abuse currently burdening California’s healthcare system.

“Doctors and insurance companies should be on the alert,” added Attorney General Brown. “We are aggressively pursuing the top prescription drug abusers, and we’re also making it easier for doctors to verify health history information provided by new patients. We encourage insurance companies to develop a similar system for protecting themselves against prescription drug fraud.”

SAN FRANCISCO – California Attorney General Edmund G. Brown Jr. today filed a motion in federal court demanding public disclosure of Federal Receiver J. Clark Kelso’s $8 billion prison construction plan.

“If public money is being spent, the public has the right to know how it’s going to be spent,” said Attorney General Brown. “To date, the proposed $8 billion medical upgrade for California’s prisons has not been shared with the public. The people of California are entitled to see for themselves whether or not the plan meets constitutional minimums or instead goes way beyond what the Constitution requires under the Eighth Amendment, prohibiting cruel and unusual punishment.”

The Receiver’s plan for prison facility construction is a 917-page document containing information on the layout, design and amenities of the seven prison healthcare facilities the Receiver seeks to build. The Attorney General contends that only 23 pages of the 917-page document fall within the terms of the protective secrecy order granted by the court earlier in the proceedings.

The court’s protective order, by its terms, only protects confidential medical records or information that may threaten the safety or security of prison personnel. Specifically, the protective order covers “Department of Corrections’ records that identify any inmate or parolee or that are designated by defendants as threatening prison safety and/or security if disclosed without protective conditions, and which are produced by defendants in informal and/or formal discover in this action.”

The Receiver’s 917-page plan forms the basis for his request to seize $8 billion from the State Treasury to build prison facilities. Attorney General Brown’s motion honors the California Constitutional principle that government is accountable to the people. Article I, Section 3 (b) of the California Constitution declares “The people have the right of access to information concerning the conduct of the people’s business…” As the Supreme Court has recognized, “informed public opinion is the most potent of all restraints upon misgovernment,” which is why, as Justice Brandeis so famously said, “Sunlight is said to be the best of disinfectants.”

The Attorney General’s motion is attached.