State Investigating Disclosure Complaints Against OC Supervisor Candidate Sergio Contreras

JULIE LEOPO, Voice of OC

Sergio Contreras at the OC Board of Supervisors District 1 debate on Thursday, Feb. 20, 2020.

State authorities have an ongoing investigation into Orange County supervisor candidate and Westminster Councilman Sergio Contreras, in response to complaints alleging he failed to disclose income, gifts, online ads and fundraising for a city monument.

A series of complaints to the California Fair Political Practices Commission accused Contreras of failing to disclose income from his employer, Orange County United Way, not reporting alleged gifts from dinners he attended, and not disclosing fundraising for a city monument honoring the Mendez v. Westminster court case that desegregated schools in California in the 1940s.

Staff at the FPPC launched an investigation and combined the multiple complaints into one case, according to complaint and response records first obtained by Voice of OC on Monday.

In an interview Monday evening, Contreras said the complaints are false and political retribution by his election opponent, OC Supervisor Andrew Do.

“Clearly it’s all revenge from him trying to load up all these baseless accusations,” Contreras said. “This is just him trying to get revenge and distract from his behavior of residency fraud, money laundering, and countless other issues he had.”

Do didn’t return a message seeking comment.

An FPPC spokesman said the case involving Contreras remains under investigation.

The complaints under investigation were filed either anonymously or by a person named Ana Morales, who couldn’t be reached for comment because her contact information was blacked out. Contreras alleged, without elaborating, that Morales is connected to Do’s office staff.

Contreras, a Democrat, ran in the Nov. 4 election against Do, the incumbent Republican, who is on track in election results to defeat Contreras and win re-election.

One of the allegations in the complaints is that Contreras had a conflict of interest because he was receiving income from his United Way job when he and the rest of the City Council were notified that city staff had approved a fee waiver for an event co-hosted by Assemblyman Tyler Diep, Do and the United Way.

“Since 2013, Sergio Contreras has been employed by United Way of Orange County, yet he has failed to disclose any income from the entity on any Form 700 Statement of Economic Interest reports,” the complaint states.

“United Way of OC has done business within the jurisdictional boundaries of the City of Westminster; thereby meeting the FPPC requirements for disclosure of income.”

The complaint alleges a conflict of interest with making a government contract, among the most serious conflict of interest laws in California.

Contreras said those allegations are false because Westminster has no contracts with the nonprofit.

United Way has “no contractual agreement whatsoever with the city of Westminster. At all,” Contreras said, while declining to say why he didn’t report income from his job at United Way.

The council action in question in the complaint was a March 13, 2019 notification to the City Council of a fee waiver city staff had authorized for a free tax preparation event hosted by the California Franchise Tax Board, Diep, Do and the United Way, according to the complaint and city council minutes. The city council “received and filed” the information at their public meeting, according to the minutes.

The complaint alleges Contreras was required to disclose his income from United Way on his state-mandated disclosure forms, including because United Way is a county contractor and because the nonprofit made a grant to Westminster-based organizations.

One of the complaints also alleges a conflict of interest from a United Way employee being a volunteer and internship coordinator with Contreras’ 2018 campaign for Midway City Sanitary Board.

“Non-profit resources could be used to subsidize campaign aides for Contreras’ political campaigns, reinforcing the need for [financial interest] disclosure” by Contreras, the complaint states.

Orange County United Way’s chief executive disputed those claims Monday, saying the employee didn’t start working at United Way until 2019.

“We are not aware of any conflicts,” said Sue Parks, president and CEO of Orange County United Way, in an email to Voice of OC on Monday. The employee started working at the nonprofit in Feb. 2019, Parks wrote.

“As far as we know, [the employee’ has not used any [United Way] resources for Sergio’s campaign.”

The complaints also point to a series of social media posts by Contreras showing him at various dinners, including the Westminster Prayer Breakfast and OC Hispanic Chamber Dinner, saying the posts show he failed to report “numerous potentially reportable gifts.”

Contreras disputed that, saying they were “not dinner gifts.”

“Again, he’s alleging all these things with no facts. He has no evidence of any of it. He’s just making all kinds of allegations,” Contreras said.

The complaints also allege Contreras failed to file a required disclosure – known as a “behested payment” form – for money he solicited to fundraise for a City of Westminster monument honoring Gonzalo and Felicitas Mendez, who were the lead plaintiffs in the civil rights lawsuit that desegregated California schools.

“I request that the Fair Political Practices Commission investigate Westminster City Councilman Sergio Contreras for failure to file a behested payment disclosure form for solicitations related to a statue honoring a campaign contributor,” the complaint states.

“Contreras has repeatedly and publicly represented himself as the organizer of efforts to establish a trail and monument in honor of his campaign contributor Sylvia Mendez of Fullerton. Mendez has contributed $1,950.00 to Sergio Contreras campaign for County Supervisor.”

Asked about it, Contreras defended his efforts to fundraise for the monument.

“Shame on [Do] for trying to muddy a historic moment in our city over acknowledging the Mendez v. Westminster case for the first time in Westminster history,” Contreras said, adding the case “made it possible to desegregate schools in California as a precursor to Brown v. Board of Education.”

“His allegations are just that – allegations – just completely to distract from his corruption, fraud and failure,” Contreras said, without addressing whether he should have filed the disclosure form.

The complaints were among a flurry of complaints lodged against both Contreras and Do in recent months. The first complaint against Contreras was filed in August by Orange County Republican Party Chairman Fred Whitaker, and was rejected by the FPPC. Whitaker didn’t return a phone message seeking comment.

More recently, FPPC officials opened – and then closed – a money laundering investigation into Do and the county Republican Party with no enforcement action, finding “insufficient evidence” of any violations. Do denied the allegations as false and politically motivated.

On Monday, FPPC officials confirmed they had an ongoing investigation of Do for the last several months, related to campaign ads and radio appearances.

Nick Gerda covers county government for Voice of OC. You can contact him at [email protected].