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Governor Brown’s Office Counsel, FPPC Collude To Cover Up Violations Committed By Deputy Legislative Counsel Martha Guzman-Aceves

Cover-up is a result of the Hews Media Group-Community News’ August 4 expose and FPPC formal complaint. Meanwhile Brown vetoes several ethics bills.




By Brian Hews

California Governor Jerry Brown, members of his administration, and the Fair Political Practice Commission (FPPC) are frantically working behind-the-scene to neutralize an expose by Hews Media Group-Community Newspaper that outlined how one of Brown’s top aids intentionally broke over forty government codes.

On August 4, HMG-CN published in print and online a very detailed investigative report documenting how Deputy Legislative Counsel Martha Guzman-Aceves, a key member of Governor Jerry Brown’s senior staff, intentionally and repeatedly filed false Statements of Economic Interests (FPPC Form 700’s) to conceal hundreds of thousands of dollars, filed false and incomplete tax returns, failed to report receipt of payments from a political committee during her appointment, and omitted third-party relationships that directly conflict with her position and duties in the Office of Governor Jerry Brown.

See August 4 story, click here.

After a tepid reaction from the Governor’s Office (GO), HMG-CN filed a comprehensive formal complaint with the FPPC that requested an immediate inquiry and investigation into the activities of Guzman-Aceves.

The complaint outlined over 40 violations in four major categories and alleged that Guzman-Aceves knew or should have known of these filing requirements and willfully failed to make the required disclosures.

See complaint, click here.

The over 40 violations in four major categories included:

• Guzman–Aceves failed to file a complete and accurate Form 700 Assuming Office Statement and Annual Statements for 2011, 2012        and 2013.

• She failed to disclose sources of income on her 700’s.

• She failed to disclose business positions and third-party relationships.

• She made or participated in governmental decisions that financially benefitted organizations where she was an officer or director.

All tolled, Guzman-Aceves violated four Government Codes: 87202, 87207, 87209, and 87100.

The FPPC complaint also contends that the GO, which is responsible for assuring that appointive officials have accurate reports, intentionally and repeatedly failed its watchdog responsibility.

The Aug. 4 Guzman-Aceves expose included the publishing of several key documents, state disclosure records, e-mails, social media posts, and other facts obtained from outside sources in HMG-CN’s article that took nearly five months to complete.

Hidden Governor’s Office Letter

On August 27, the FPPC answered the month’s long investigation and eleven-page HMG-CN complaint with a terse one-page letter.

The FPPC letter was based on a response from the Governor’s own Deputy Legal Affairs Secretary Daniel J. Powell, who apparently defended Guzman-Aceves on the matter.

That letter would have never been found had HMG-CN not requested all FPPC documents related to the Guzman-Aceves-FPPC investigation via a public records request.

In the two-page letter, the GO and Powell failed to respond to a majority of the complaints, made indefensible and weak arguments for the complaints it chose to include, all while repeatedly assuring the FPPC throughout the letter that opening an inquiry into Guzman-Aceves “was unnecessary.”

FPPC’s Chief of Enforcement, Gary Winuk then basically “cut and pasted” the GO letter and delivered it to HMG-CN, calling the allegations and overwhelming evidence “without merit and insufficient.”

Click on image below to view letters.




Winuk first argued that Guzman-Aceves, was not, according to the list below, a “designated employee” under the Governor’s Conflict of Interest Code, (COIC).



He argued that since she was not a “designated employee,” the GO was not required to forward the 700’s to the FPPC, rather, the 700’s are “retained by the Office of the Governor and made available for public inspection upon request.”

Nowhere was it mentioned that Guzman-Aceves lied on her 700’s.

Winuk also argued that Guzman-Aceves was:

  1. Not required to disclose the information about her conflicts because she received no compensation from the organizations identified in the August HMG-CN article;
  2. The organizations were non-profit organizations consequently Guzman-Aceves was exempt from any reporting requirements;
  3. All amounts paid to her from those organizations were less than the limit required for reporting.

Internet Search Shows Guzman-Aceves is a Designated Employee

The assertion that Guzman-Aceves was not a designated employee was easily disproven by a simple Internet search.

According to the Sacramento Bee’s State Worker Salary Database, Guzman-Aceves held the position of Assistant to the Governor from 2011 to 2012 and Senior Assistant to the Governor in 2013.



Those positions qualified her as a  “designated employee” under the COIC, a fact that the GO and FPPC somehow “overlooked;” an attempted cover-up of the true facts pertaining to Guzman-Aceves and her reporting requirements.





Specific Reporting Requirements for Designated Employees

The code states that designated employees must report “all investments, sources of income, interest in real property, and any business entity in which the designated employee is a director, officer, partner, trustee, employee, or holds any position of management.”

There are two separate and distinct statements in the COIC.

One statement is (the designated employee must) “report all investments, sources of income, {and} interest in real property.”

Unreported Sources of Income

HMG-CN had shown in its Aug. 4 article, and the GO and FPPC could have easily accessed these documents online, that Guzman-Aceves failed to report on her 700’s that she was CEO and a fiduciary officer of Communities for a New California-Education Fund (CNCEF) that reported it lobbied and spent $1,774 on lobbying.

In addition, Guzman-Aceves did not report over $5,700 in “occupancy costs” of CNCEF.

CNCEF was operated out of a residence owned by Guzman-Aceves. The address was the same as the address given for her voter registration, and CNCEF reported on its tax return that it paid $5,732 in “occupancy costs.”



It was also shown that she was a director for the board of Pesticide Action Network North America (PANNA), an entity that paid Communities for a New California (CNC), a non-profit controlled by Guzman-Aceves and her partner in Cultivo Consulting Jennifer Hernandez, for services CNC rendered under Guzman’s direct control. Hernandez was CEO of CNC.





FPPC filings of the political committee Communities for a New California-Fresno Committee (CNCF) reveal that Guzman made cumulative year-to-date reimbursable expenditures on behalf of the committee of at least $656.85 during 2010, was paid back $218.95 of the total on November 5, 2010, but failed to report that the balance of $437.90 was carried forward to 2011 as an accrued debt of the committee to Guzman.

The committee reported in 2011 that it owed a pre-existing debt of $437.90 to Guzman. Guzman-Aceves failed to report any transactions involving her receipt of money and loan to the committee on her “assuming office” FPPC 700’s, once again violating the two-year assuming office disclosure law.




But the GO and the FPPC somehow disregarded the overwhelming evidence that showed Guzman-Aceves’ titles, fiduciary role, monetary receipts, and responsibilities in conflicting entities. They also disregarded payments that were greater than the cap limits.

In addition, all the foregoing violations were subject to disclosure under the GO’s own COCI policy, GC 81000.




Second Statement in COIC

The other separate statement in the COIC is (the designated employee must report) “any business entity in which the designated employee is a director, officer, partner, trustee, employee, or holds any position of management.”

As outlined above, and in HMG-CN’s Aug. 4 article and complaint, Guzman Aceves failed to report on her 700’s the CEO position in Communities for a New California-Education Fund (CNCEF), her other director positions (PANNA), and the ownership/partnership in Cultivo Consulting.

But the GO and FPPC countered that argument citing Section 82005 of the Code.

They said that although the COIC 82005 states “any business entity,” it only applies to “any entity operated for-profit.”

Winuk Contradicts Himself

But that argument directly contradicts the FPPC’ s position and pleadings in its own high profile 2012 lawsuit, FPPC v. Americans for Responsible Leadership (ARL).

ARL, a non-profit organization, had given large contributions to the Small Business Action Committee, which opposed Gov. Jerry Brown’s Prop. 30 tax increase initiative in the 2012 elections.

The FPPC sued and won the fast-tracked case for an audit of ARL. They argued that GC 82005-with the court agreeing with the FPPC’s position-that the Act “must be liberally construed to include non-profit corporations that make political contributions in order to accomplish its purpose.”

The California Legislature even responded to the loophole by quickly passing AB 800 and SB 27 that essentially removed non-profits from protection under 82005.

Former FPPC Chairwoman Ann Ravel said, “The FPPC is aggressively litigating to get disclosure and working on laws and regulations to put a stop to these practices in California.”

As a result of the case, both of Guzman-Aceves’ two non-profits, CNCEF and Communities for a New California (CNC) fall under the ARL case law—therefore the Conflict of Interest Code would reasonably apply to them the same as if they were for-profit entities.

Apparently not under the GO or FPPC Chief Gary Winuk.

In their response letter to HMG-CN, the GO and the FPPC argued that Guzman-Aceves companies were exempt under 82005 and therefore she did not need to report them on her 700’s.

Their argument to HMG-CN (and the FPPC complaint) stands exactly opposite to the stance argued by FPPC lawyers in FPPC v. ARL case.

Documents show that there are glaring errors in the GO’s and Winuk’s arguments and further suggest an attempted cover-up by the GO.

The GO is ignoring voluminous amount of evidence in the HMG-CN August 4 article; ignoring monies paid to Guzman that were well above the non-reportable cap amount; and ignoring that the California Legislature has made non-profits subject to conflict-of-interest disclosures.

Further, as evidenced by the Guzman-Aceves 700’s, the GO and the FPPC are not investigating the 700’s for accuracy and is in violation of its own COIC.

Cultivo Consulting Never Dissolved

Another indefensible argument by the GO and FPPC was that Guzman-Aceves was no longer founder/owner/CEO and is not receiving compensation from the previously mentioned for–profit partnership, Cultivo Consulting.

In the documents obtained from the FPPC via a public records request related to the Guzman-Aceves investigation, no paperwork was found to demonstrate the dissolution of Cultivo.

It is apparent that Winuk, after receiving Powell’s letter, did not ask him to produce dissolution documents, and Powell did not volunteer any evidence to support the statement his letter.

A California partnership exists until one partner passes away or it is dissolved.

Yet the FPPC argued that Guzman-Aceves did not violate the code because she “resigned her position as partner (at Cultivo) when she began work at the Governor’s Office in June 2011.”

Once again, the GO and FPPC disregard the overwhelming evidence and state “no further investigation is necessary.”

The August HMG-CN article showed that in January 2013, Ms. Guzman-Aceves provided her biography to Latino Journal prior to receiving the Spirit of Latina Award.  In the published biography, Ms. Guzman-Aceves described herself as “co-founder of Cultivo Consulting (as well as CNC).



Guzman-Aceves was also was prominently listed on the Cultivo website until at least July 2014.

More documents show Cultivo existed in Nov. 2011 and Jan 20, 2014




All the above documents were obtained by a simple Internet search.


Used Her Official Position for Financial Gain

The last argument claimed that Guzman-Aceves did not violate the COIC as it relates to using her official position to influence government decisions for her organizations or her personal financial benefit.

HMG-CN established in this article and its Aug. 4  article that Guzman-Aceves was a director of Pesticide Action Network North America (PANNA) until at least Sept. 7, 2011.

Cultivo website documents described Guzman as a director of PANNA until April 28, 2012.




Communities for a New California Education Fund (CNCEF), of which Guzman-Aceves was the CEO, was a member of the Steering Committee of a PANNA program, Californians for Pesticide Reform (CPR), until at least April 2014.

In April 2014, PANNA published a school children pesticide safety position paper, “Protecting Their Potential” naming CNCEF as one of CPR’s steering-committee members.




Guzman-Aceves’ partner executed the contract while Guzman was handling regulatory and legislative matters for the Governor on agriculture, pesticides, water, and the environment, matters that directly related to PANNA’s advocacy interests.

The tax returns of PANNA and CNC showed that CNC’s Chief Executive Officer and Guzman’s Cultivo partner, Jennifer Hernandez, executed a contract between the two organizations to “conduct public outreach and education pertaining to food and agriculture, grassroots lobbying and voter outreach” on PANNA’s behalf at the same time as the Executive Director of both CNC and CNCEF, Pablo Rodriguez, reported to Guzman as well as Hernandez.



In addition, as Executive Director of CNCEF, Rodriguez signed a PANNA public comment letter and sent it to the Director of the Department of Pesticide Regulations arguing in favor of a specific partisan action in an open pesticide regulatory decision.

Once again, the GO and FPPC disregarded overwhelming evidence as documented in the HMG-CN complaint and its Aug. 4 article and ignored Guzman-Aceves’ egregious conflicts of interest that were never disclosed in her statements of economic interests FPPC 700’s.

Additional Violations

The negotiated public outreach contract between CNC and PANNA and the subsequent compensation places both firms in the position of engaging in activities clearly in conflict with Guzman-Aceves’ duties as a Senior Assistant to the Governor and prohibited by statute.

By compensating CNC, PANNA likely expected to enjoy the influence of the State and governor’s authority for its gain and to further its already conflicting relationship with Guzman-Aceves as a PANNA director.

Further, in accepting compensation from PANNA, CNC entered into an obvious conflicting relationship, conducting business with Guzman-Aceves and her subordinates.

Yet the GO and FPPC argued that Guzman-Aceves had no financial interest in these entities while the documents clearly show that the arrangement had obvious potential to influence Guzman-Aceves in her official duties.

They also may show a “reward” given to Guzman-Aceves for executing official actions favorable to PANNA on legislative and regulatory matters.

In the face of all the preceding overwhelming evidence, the FPPC and Winuk appear willing to accept the Office of the Governor’s assurances at face value and conduct no investigation nor sanction Guzman-Aceves for her violations.

The Office of the Governor’s counsel is equally guilty for failing to respond to other complaints, answering with a blanket “no further investigation into the matter is warranted.”

Winuk’s biography on the FPPC website states, “…the Enforcement Division’s responsibilities include…investigating allegations of violations …by public officials and referring allegations of criminal misconduct to the appropriate criminal investigative and prosecuting agencies, i.e., Attorney General, District Attorney, FBI, IRS, and the U.S. Attorney…..

Given the facts of this article, an additional complaint was  filed on Sept. 23  with the FPPC asking them to reconsider opening an investigation of Guzman.

Several calls into Guzman and the Office of the Governor for comment were not returned.