East Bay City Council Member Caught Up in Federal Investigation That Targeted Sheng Thao

Federal prosecutors have charged San Leandro City Councilmember Bryan Azevedo, alleging he agreed to use his power as an elected official to benefit a company in exchange for his own personal financial gain.

In a document filed in federal court on Tuesday, Azevedo is charged with one count of conspiracy to commit honest services wire fraud and one count of making false statements to a government agency.

The charges come after months of speculation about the extent of Azevedo’s connection to an ongoing FBI corruption investigation that saw the indictment of former Oakland Mayor Sheng Thao, her partner Andre Jones, and David and Andy Duong in January.

U.S. attorneys allege in the filing that Azevedo and two unnamed individuals conspired to obtain a contract from the city of San Leandro for a housing company in exchange for cash and kickback payments to Azevedo.

They also accuse Azevedo of creating an LLC in his wife’s name and opening a bank account for the purpose of receiving illegal payments.

In a meeting with reporters Tuesday afternoon, San Leandro Mayor Juan Gonzalez said he had not yet spoken with Azevedo and that, as of now, he is not requesting that the council member step down.

“If he pleads guilty to a felony, the (San Leandro City) Charter makes clear how we proceed. Namely, he may not be a felon and be a member of the city council,” Gonzalez said. “But if he were to plead to something else that did not rise to the level of felony, then we will cross that bridge when we get there. And of course he might be exonerated by a jury of his peers.”

Gonzalez declined to comment on whether he had been interviewed by the FBI, saying only that the city of San Leandro cooperates with all investigations. He also referred to the situation as a “private matter” between Azevedo and the U.S. Department of Justice.

According to the filing, Azevedo attended a 2023 trip to Vietnam sponsored by a business association. Upon returning from the trip, prosecutors allege, Azevedo agreed to use his power as a San Leandro city council member to help obtain a contract for an Oakland-based housing company that aimed to manufacture modular homes made from shipping containers. In exchange, Azevedo would receive a percentage of the sales from units the city purchased, the filing alleges.

Azevedo has acknowledged his participation in a 2023 Vietnam trip that Thao and other East Bay officials also attended. The trip was sponsored by the Vietnamese American Business Association, led by David Duong.

The housing company described in the court filing is not explicitly named.

A lawsuit filed by former San Leandro City Manager Francis Robustelli in June alleges Azevedo and fellow San Leandro City Councilmember Victor Aguilar invited her to the Oakland showroom of Evolutionary Homes in 2023. The visit was part of an effort by members of the Duong family, which owned the company, to lobby San Francisco Bay Area politicians to promote the establishment of tiny home developments in the area, Robustelli alleges.

Robustelli’s lawsuit claims a representative of Evolutionary Homes pitched an emergency homelessness ordinance to San Leandro officials that would allow the city to more quickly purchase homes like the ones the company aimed to sell. It was never enacted.

According to the document filed Tuesday, during the fall of 2023 and spring of 2024, Azevedo advocated for an emergency shelter ordinance that would benefit the unnamed housing company, advocated for the city to purchase units from the company and took San Leandro city officials to tour the company’s model units.

In November, prosecutors allege, one of the unnamed co-conspirators gave Azevedo $2,000 in cash at a dinner in Alameda in exchange for using his position as an elected official to benefit the housing company. Several days later, he allegedly deposited the money into the recently opened bank account.

San Leandro City Councilmember Victor Aguilar, reached by phone on Tuesday, declined to comment on the charges against Azevedo.

In January, FBI agents raided Azevedo’s San Leandro home, two days before Thao, Jones, and Andy and David Duong were charged with conspiracy, bribery and fraud.

In May, officials with the U.S. Attorney’s Office notified Azevedo via a target letter that he, too, was the subject of a federal investigation.

The document filed Tuesday alleges federal investigators in January asked Azevedo whether he had received cash payments from one of the co-conspirators in November 2023 and that Azevedo responded that he had not. Agents also allegedly asked Azevedo whether the co-conspirator’s family had business interests before the city of San Leandro, and he responded that it did not.

“These statements AZEVEDO made to the agents were false and AZEVEDO knew they were false,” the document reads.