Oakland Corruption Trial: FBI Agent Shares Misstep That Tipped Off Investigators
A tip from the Oakland Public Ethics Commission launched the federal investigation into the alleged pay-to-play corruption scheme at the center of former Mayor Sheng Thao’s criminal trial, an FBI agent told the jury in federal court on Monday.
The testimony came amid protests outside the courthouse from anti-public corruption activists and after a former Thao staffer shed light on efforts her staff made in the lead-up to the 2022 mayoral election to distance themselves from negative campaign mailers depicting her opponents. Thao’s former chief of staff Leigh Hanson also doubled down on her testimony last week that Thao called Andy Duong a “playboy” who was going to “ruin her career” as the second week of the trial got underway.
Thao, her longtime romantic partner Andre Jones, recycling executive David Duong and his son, Andy Duong, are facing conspiracy and bribery charges for their alleged involvement in a quid pro quo to elevate the Duongs’ companies in exchange for $300,000 paid to Jones and support for Thao’s 2022 mayoral bid.
Federal Bureau of Investigation Special Agent Katherine Barclay testified Monday that the citizen commission that monitors Oakland city government approached the FBI in February 2023 with a report of possible political corruption from the person hired to print mailers targeting Thao’s mayoral opponents.
Barclay alleged that the FBI’s investigation began in connection with a separate check fraud case by Alameda County District Attorney’s Office against Oakland businessman and political operative Mario Juarez, who was accused of commissioning the mailers but failing to pay for them. The District Attorney’s Office later dropped the case.
Juarez has pleaded guilty to participating in the alleged bribery scheme involving Thao and is expected to serve as a key cooperating witness for the government later in the trial. Each of the defendants has pleaded not guilty.
According to Barclay, Juarez had hired Samari Johnson’s company to print a number of campaign mailers attacking Thao’s opponents just before Election Day but had paid more than $50,000 for the mailers with invalid checks.
Johnson later filed a police report against Juarez, and the Alameda County District Attorney’s Office opened a criminal case against him in January 2024, but dropped the charges after Juarez alleged that then-District Attorney Pamela Price was retaliating against him for refusing to donate to her own campaign. Price was recalled alongside Thao in November 2024.
Barclay testified that Johnson said Juarez made statements to him “about expecting things in return for the mailers from the candidate he was supporting.”
That information led the FBI to obtain a search warrant for Juarez’s Apple iCloud account, where they found a document on the Notes application called “Sheng Thao Deal Points.”
The note, which Juarez later sent to Andy Duong in a WhatsApp message, lays out much of the alleged scheme, including the Duongs’ and Juarez’s promise of the negative mailer campaign and $300,000 in exchange for purchasing housing units from Evolutionary Homes, appointing certain individuals to city administration positions and extending California Waste Solutions’ contract with the city.
Barclay also said that after an altercation between Juarez and the Duongs at California Waste Solutions’ headquarters in May 2024, the Oakland Police Department brought allegations that Juarez made “against” the Duongs and the police department to the FBI. An attorney representing Juarez at the time told the San Francisco Chronicle that he was “severely beaten” in the incident.
Barclay said the FBI first approached Juarez for an interview after that.
Former Thao chief concludes testimony
Before Barclay took the stand late into the day on Monday, Andy Duong’s attorney, Winston Chan, questioned Hanson about statements she made last week regarding his client’s conduct on a trade delegation to Vietnam in the summer of 2023 that Thao and other East Bay officials also attended.
The trade delegation has become a flashpoint in the criminal case, after court records raised questions about who sponsored the high price tag for attendees’ travel, including business class flights, and after allegations surfaced in July that another elected official on the trip engaged in “suspected drug use and activity involving prostitutes.”
On Thursday, Hanson said that after a journalist had approached the mayor’s office with questions about the rumors, Thao became especially angry with Andy Duong, saying of him: “I hate that fucking playboy, he’s always been trouble, he’s going to ruin my career.”
Insinuating Andy Duong’s involvement and alleged child sex trafficking were revelations previously unknown to the public — and went against the court’s pre-established decision that the government would not elicit testimony revealing the alleged involvement of minors.
On Monday, Chan asked Hanson if she was sure her comments weren’t in reference to David Duong. He pointed to a transcript of an interview Hanson gave to the FBI in 2024, in which Hanson reportedly told investigators Thao was in fact angry with David.
Hanson did not back down when Chan pressed her: “She did not mention David Duong, she mentioned Andy,” Hanson told the court.
Hanson did acknowledge that the reporter did not accuse Andy Duong by name.
After Hanson’s testimony, leaders of the 2024 campaigns to recall Thao and Price held a press conference outside the courthouse, demanding an “end to City Hall corruption” in Oakland. Both elected leaders were recalled with more than 60% of voters supporting their removal from office.
“The same political infrastructure that installed and protected Thao continues to control Oakland City Hall,” the recall leaders wrote in a press release.
Taylor mailers hurt or help?
Noah Finneburgh, a former member of Thao’s 2022 mayoral campaign team, also testified Monday, shedding light on the campaign’s response to the controversial mailer campaign Juarez orchestrated.
The mailer includes an altered photo of Thao’s top competitor, Loren Taylor. The image of Taylor, who is Black, appears to have been photoshopped so his mouth tilts down into a frown, the arch of his eyebrows is accentuated, his skin is darker, and there is a red hue cast over the image that makes his pupils appear to have red sparks in them. Taylor has alleged the ad intended to make him look angry, following a racist stereotype against Black men.
Finneburgh said Thao’s staff wanted to minimize the ads, not draw attention to them, since they believed they would hurt the campaign by alienating voters.
“They just didn’t seem credible to me. They seemed like something someone would see and think, ‘just another attack ad,’” Finneburgh said.
Thao’s top campaign staff went back and forth about how to respond and ultimately posted on Twitter denouncing the ads as “incredibly offensive,” saying her campaign “did not and would never send something like this out.”
Barclay will continue to testify Thursday. She’s expected to speak about a number of documents the FBI obtained from various cell phones, tablets and computers that were collected in the raids at the California Waste Solutions office and inside the homes of Thao and Jones, Andy Duong and David Duong in June 2024.
Editor’s Note: This story has been updated to remove a description of signs protestors carried depicting a current councilmember who has not been named in connection to the trial.