San Francisco’s former Public Utilities Commission General Manager Harlan Kelly, mired in fraud charges over the last year, was charged Tuesday with new counts of fraud, including federal charges of bank fraud and conspiracy to commit bank fraud.
According to the indictment, prominent San Francisco real estate investor Victor Makras is facing the same charges as Kelly.
Both Kelly and Makras are also being accused of honest services wire fraud and conspiracy to commit honest services wire fraud.
The charges are all related to a widespread scheme of Kelly’s where he exchanged information for perks and bribes, which he was first charged with in November of 2020.
According to the latest indictment, Kelly engaged in a "long-running bribery scheme and corrupt partnership with an individual identified in the indictment as 'Contractor #1.'"
Kelly took over the role of general manager of the PUC in 2012, and held the position until November 30, 2020, resigning in the face of the federal charges.
The indictment said that Contractor #1 is a San Francisco construction company executive and permit expediting consultant, who oversaw several projects in the city. Kelly allegedly shared internal department information with Contractor #1 to give them an advantage during the bidding process over city contracts. In return, Contractor #1 did several favors for Kelly, including reduced pricing on construction of Kelly’s home and paying for Kelly’s family to take expensive international vacations.
With Makras, Kelly conspired to defraud loan company Quicken Loans, according to the indictment. Kelly’s plan was to acquire a $1.3 million dollar real estate loan using inflated debt that Kelly falsely owed from an existing loan to Makras Investors. Using that, Kelly was able to get a higher loan amount at a lower rate. Kelly and Makras also engaged in other various loan schemes.
The federal investigation into Kelly is related to a larger case, targeting multiple city and county officials in an effort to weed out conspiracy and corruption. So far, 12 individuals including high-ranking city officials and city contractors have been charged for taking or presenting bribes.
Kelly is set to make an appearance in federal court Wednesday morning in response to the new charges.
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