San Diego, California - Former San Diego Police Detective Ernesto Encinas pled guilty today to charges that he conspired to commit campaign finance crimes in connection with a series of elections at the local and federal level. At the same hearing, Encinas also pled guilty to charges that he made false statements to the Internal Revenue Service when filing tax returns on behalf of his private security business, Coastline Protection and Investigations Inc.
As part of his plea agreement, Encinas admitted to a range of allegations first brought to light on January 21, 2014, when prosecutors unsealed a complaint against him. Speaking under oath before U.S. Magistrate Judge William V. Gallo, Encinas admitted that he and his co-conspirators agreed to make illegal contributions on behalf of Jose Susumo Azano Matsura, a foreign national who was arrested by FBI agents on related campaign finance charges in February. Foreign nationals cannot lawfully contribute to any campaign at the federal, state, or local level. Also as part of the plea, Encinas confirmed that he and others, including Azano, Ravneet Singh, and Marco Polo Cortes, agreed to make conduit contributions in connection with a federal election, as well as falsify records with the intent to impede a federal investigation—both of which are felonies regardless of whether the source is a citizen or foreign national. (Azano, Singh, and Cortes, who were charged earlier this year, have pleaded not guilty to the charges filed against them.)
Encinas’s plea agreement detailed other aspects of the scheme not previously disclosed in public filings. For example, Encinas admitted to FBI agents that Azano induced a series of individuals to donate directly to Candidate 1, described as a candidate for the office of mayor of San Diego during the 2012 primary election cycle. Encinas stated that Azano provided cash, which the straw donors each used to make the maximum possible donation to Candidate 1.
In addition, as part of his plea agreement, Encinas admitted that during tax years 2011 and 2012, Azano paid Encinas approximately $10,000 in cash “off the books.” Encinas failed to report approximately $147,300 of such cash payments in tax year 2011 and approximately $74,900 in cash payments in tax year 2012, for a total of approximately $222,200 in unreported cash income. This resulted in a tax loss of $69,394.36 over two years, which Encinas agreed to pay back as restitution.
First Assistant United States Attorney Cindy M. Cipriani said, “To secretly inject foreign money into our elections is an affront to the transparency and integrity of our electoral system. In obtaining this guilty plea, we demonstrate our continuing efforts to investigate and prosecute campaign finance crimes in San Diego and beyond.”
FBI Special Agent in Charge Daphne Hearn said, “Illegal campaign contributions from foreign sources undermines our electoral process and ultimately our democracy. The FBI is committed to working with our law enforcement partners to identify and root out public corruption wherever it may be happening.”
Special Agent in Charge of Internal Revenue Service Criminal Investigation (IRS CI) Erick Martinez commented, “Retired San Diego Police Detective Ernesto Encinas intentionally failed to report over $222,000 in cash received by keeping this money ‘off the books.’ Today’s guilty plea should serve as a reminder—all of us have an obligation to file an accurate and truthful tax return. Failure to do so could result in criminal prosecution.”
Encinas’s sentencing hearing has been set for June 9, 2014, at 9 a.m. before United States District Judge Michael M. Anello.
Defendant in Case Number: 14CR0344-MMA
San Diego, California
Summary of Charges and Maximum Penalties
Count one: conspiracy to commit offenses against the United States—18 U.S.C. § 371
Maximum penalties: five years in prison, three years of supervised release, $250,000 fine, and a $100 special assessment
Count two: false tax return—26 U.S.C. § 7206(1): three years in prison, one year of supervised release, $250,000 fine, and a $100 special assessment
Federal Bureau of Investigation
Internal Revenue Service, Criminal Investigation
San Diego Police Department