Business
L.A. ethics panel rejects proposed $11,250 fine for Leslie Moonves as too low
The Los Angeles City Ethics Commission on Wednesday unanimously rejected a proposed settlement between the city and former CBS Chief Executive Leslie Moonves, saying a tougher penalty was warranted for the executive, who had been accused of interfering with a police investigation into sexual assault allegations against him.
Moonves had agreed to pay an $11,250 fine to settle a City Ethics Commission complaint that accused him of inducing a government official to violate laws so that Moonves would have a tactical advantage in a police complaint against him.
Ethics Commission staff worked with Moonves on the proposed fine, but it still needed approval by the volunteer panel that oversees the department.
Jeffrey Daar, president of the Ethics Commission, acknowledged it was “somewhat unusual” for the panel to reject a proposed fine.
The commissioners felt that the “extremely egregious nature of the allegations” warranted a stronger penalty, Daar said.
Each count carried a maximum penalty of $5,000, or $15,000 for the three counts.
A Moonves representative declined to comment on Wednesday’s action.
The matter dates back to November 2017, when former Los Angeles Police Cmdr. Cory Palka began working with Moonves and other CBS executives to allegedly bury an LAPD complaint made by a woman who had accused Moonves of sexual assault in the 1980s.
Palka, who has since retired, was then head of the Los Angeles Police Department’s Hollywood station. He’d known Moonves for nearly a decade because he had been part of Moonves’ security detail for the Grammy Awards for several years.
Moonves’ career as head of CBS collapsed amid a widening sex scandal that came to light as part of the #MeToo movement. Moonves, who stepped down from CBS in September 2018, has denied harassing or assaulting women.
The ethics complaint detailed how, on Nov. 10, 2017, a former colleague, Phyllis Golden-Gottlieb, was inspired to speak out about her allegations of past dealings with the then-powerful TV executive.
She drove to the Hollywood station to file a report against Moonves. Later that night, Palka called CBS officials and alerted them to the existence of Golden-Gottlieb’s report.
Over the next few weeks, Palka, Moonves and one of Moonves’ underlings discussed strategies to thwart Golden-Gottlieb’s report and worked to make sure it didn’t gain traction within the Police Department or the L.A. County district attorney’s office, according to records in the case, which came to light in late 2022 as part of a report by New York Atty. Gen. Letitia James.
James had accused Moonves and CBS of misleading investors about the scope of the sexual harassment uncovered at CBS — information that was damaging to the company’s stock.
The former CBS chief was accused of three violations of the city’s Government Ethics Ordinance, which governs the conduct of city employees and forbids them from misusing or disclosing confidential information acquired through their work.
Under terms of the proposed settlement, Moonves had agreed to pay a $11,250 settlement and acknowledged that he violated city laws by “aiding and abetting the disclosure and misuse of confidential information.”
He also admitted to inducing “a city official to misuse his position to attempt to create a private advantage for Moonves.”
The ethics complaint also had accused Moonves of violating the city ordinance by inducing Palka “to create for Moonves the private advantages of access to confidential information from an LAPD investigation.”
The ethics board also on Wednesday rejected a proposed $2,500 settlement with Ian Metrose, the former senior vice president of talent relations and special events at CBS. Metrose admitted he violated city law by aiding and abetting the disclosure and misuse of confidential information.
Daar said the cases remain with the enforcement division at the Ethics Commission.
The City Charter lays out maximum fines for penalties, but the fines haven’t been updated in decades. The Ethics Commission is seeking to increase the penalties, Daar said.
“Five thousand dollars doesn’t make sense today, particularly when you have very egregious allegations,” Daar said.
Business
Read Nick Bilton’s Letter to Scott Pelley
Dear Mr. Pelley:
I meant what I said in my letter last week to the 60 Minutes team: joining 60 Minutes is the honor of my career and I am grateful to be working alongside the people who have contributed to the most important television journalism brand this country has ever produced. While I’m new to 60 Minutes, I’ve devoted my career to investigative journalism and storytelling. I started this job excited to collaborate and to benefit from the wisdom and experience of the 60 Minutes veterans, with you among them. For that reason, one of the first things I did in my new role was call you to talk and invite you to dinner. It is a profound disappointment that you rejected that overture and chose ambush instead. Yesterday, you hijacked my first meeting with staff to disparage me, my qualifications, and my intentions with remarkable incivility and contempt. I welcome a diversity of viewpoints and respectful debate among the team, but this was nothing of the sort. Yesterday’s performative display of hostility enacted in front of the staff instead of in a civil, private conversation-demonstrated that you have no interest in contributing to the future success of the show, or approaching my new tenure with a mind open to collaboration and progress. I am here to deliver first-in-class news programming, not to make headlines about newsroom drama. I am eager to work alongside those who share this goal.
Despite yesterday’s misconduct, I had hoped that in sitting down with you today we could find a path forward together. You made clear that you are not interested in such a path.
Your antipathy to the future of the show has come through loud and clear. And I have heard you. I therefore write on behalf of CBS News, Inc. (“CBS”) to inform you that your employment with CBS is terminated for cause effective immediately. Enclosed is your formal termination letter.
Sincerely,
Nick Bilton
Executive Producer, 60 Minutes
Business
Aspiration co-founder sentenced to 14 years for fraud
The co-founder of Aspiration, Joseph Sanberg, was sentenced to 14 years in prison on Monday after defrauding investors and lenders of over $248 million.
The startup, an eco-friendly digital banking company boasting fossil fuel-free investments, carbon offsets for gas purchases, and a debit card with cash-back benefits for shopping at clean companies, was founded by Sanberg and Andrei Cherny. Cherny left the company in 2022 and has not been charged.
Sanberg, an Orange County native, pleaded guilty to wire fraud in October after being arrested in March last year. Aspiration subsequently filed for bankruptcy and liquidated all of its assets by July.
Sanberg and venture capitalist Ibrahim AlHusseini, who also faces charges, together forged a series of bank statements in order to obtain loans. From 2020 to 2021, the pair forged AlHusseini’s bank statements to show millions of dollars in assets in order to obtain millions of dollars from lenders.
Additionally, they forged a letter from their audit committee stating that $250 million in funds were available, when in reality Aspiration had less than $1 million. The amount of loans defrauded exceeded $248 million.
In 2021, Sanberg artificially inflated Aspiration’s 2021 revenue by $44 million by recruiting 27 fake customers to sign letters of intent pledging tens of thousands of dollars per month for tree planting services. Sanberg himself funded the contracts and used the inflated revenue numbers to obtain more loans.
The charges sparked an NBA investigation into salary cap allegations due to Aspiration’s connections with Clippers owner Steve Ballmer.
Ballmer personally invested $60 million in Aspiration, all of which was lost. He is now the target of a civil lawsuit alleging his participation in the scheme. Ballmer denies the allegations.
The team announced a $300-million sponsorship deal with Aspiration, and Clippers player Kawhi Leonard signed a four-year, $28-million marketing contract with the company, which reportedly performed no duties. The issue has raised concerns about how players are circumventing the NBA’s salary cap.
The team lost the $300-million sponsorship deal and an additional $20 million paid for carbon offset purchases.
Business
Monterey Park takes landmark vote on banning data centers
Residents in the city of Monterey Park will be the first in the nation to vote on a permanent ban on data centers Tuesday.
If approved, Measure NDC would prohibit data centers within the city limits and could only be overturned by another vote.
Yard signs saying “No Data Center” in English and Chinese with images of dragons line sidewalks in the San Gabriel Valley city.
As a wave of data center opposition sweeps the country, numerous towns and counties across the U.S. have instituted temporary moratoria and other restrictions on the facilities. But only a handful have instituted indefinite bans, and just four other towns have sent related matters to the ballot.
Supporters are hoping the vote will set a precedent for the rest of the region, where residents are fighting proposals in Vernon and City of Industry.
“This is about as permanent a ban as we can get,” said Steven Kung, co-founder of the group No Data Center Monterey Park. “Winning Measure NDC would send a huge message to the rest of the San Gabriel Valley about how residents don’t want data centers.”
The ballot measure emerged from the fight against a 247,000-square-foot center proposed in 2024 by the Australian-owned investment firm HMC StratCap for a residential area in Monterey Park.
The facility would have sat less than 500 feet away from the nearest home and used three times the electricity of the 60,000-person, predominantly Asian American city.
While the developer touted the potential for jobs and tax revenue, residents expressed concerns about noise and air pollution, rising electricity rates and a potential to lower property values.
The company pulled its plans in late March following public outcry and a March 4 city council vote to extend a temporary data center moratorium and place a ban on Tuesday’s ballot.
In a letter to the city council, HMC StratCap said it would pursue a different use for the land and would not engage in a ballot measure fight.
The city council later banned data centers indefinitely, the first in California to do so, said Mayor Elizabeth Yang. But she’s still been out campaigning for the measure with all four other council members.
“If a council puts in an ordinance, a future council can reverse it too,” said Yang. “With the ballot measure, unbanning it is a lot harder because you need the entire city to vote on it.”
The measure proposes the ban “to protect air quality, drinking water resources, and public health” and “prevent impacts to electricity and water rates.”
While California places third in the country for existing data centers with about 300 facilities, it hasn’t been a hot spot in the recent AI-driven data center boom. High electricity rates, expensive land and regulatory hurdles mean that fewer, and smaller, facilities are currently planned than in Virginia, Texas, Georgia, Illinois or Arizona.
“Most of California’s data centers are small by today’s standards,” said Shaolei Ren, an engineering professor at UC Riverside who studies how to reduce the environmental impacts of data centers. “Ten years ago, they would be medium-sized, but the power demand for new AI data centers has increased a lot.”
The average operating data center demands 45 megawatts, according to the Washington Post, while the average planned one would draw 430 MW. The one proposed for Monterey Park would have required about 50 MW at peak demand.
As proposals crop up in SoCal, they’re met with fierce opposition. Montebello, El Monte and Baldwin Park have all enacted temporary moratoria, and Alhambra recently banned data centers as part of a zoning code update. City of Industry, Vernon, City of Commerce and Santa Fe Springs are moving in the other direction, trying to court developers and streamline data center approvals. Community groups are fighting that.
Outside the San Gabriel Valley, residents of Coachella and Imperial County are showing up in droves to protest local proposals.
Matthew Shaw, a volunteer with the Coalition for Responsible Data Center Development, who recently published a report on opposition to AI data centers, said a vote to ban them in Monterey Park “would lead to copycats, partially because so many groups are just opposed to any data center development at all.”
While there is no formal opposition to Measure NDC, some building trades like Ironworker Local 433 supported the Monterey Park data center when it was still live before city council. Those in the data center industry are lamenting the state of public opinion.
“These are multi-billion-dollar assets that are built by multi-trillion-dollar companies. These things will get done,” said Mehdi Paryavi, chairman of the International Data Center Authority. “My biggest problem is that our industry does not invest enough in community engagement.”
Paryavi said towns that seek to limit data centers are missing out on thousands of jobs generated by data center construction, operations and customers, as well as faster artificial intelligence speeds and better performance.
Kung said local community organizers are “looking at the empirical evidence” and seeing a ban as a win.
“We’ve never seen a city that embraces a data center and is like, ‘Look how our quality of life has increased, look how all the revenue has gone into citywide improvements,’” he said. “That just doesn’t exist.”
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