CA: Alleged Cannabis Bribery Attempt In Oakland Prompts Investigation

Photo Credit: Carlos Avila Gonzalez

A man who Oakland City Council President Larry Reid says tried to bribe him to help obtain a cannabis dispensary permit also allegedly offered two businessmen assistance in getting a dispensary license in exchange for bags of cash, The Chronicle has learned.

The man, local developer Dorian Gray, tried last month to give Reid an envelope he said had $10,000 in it, Reid said. Gray then approached the city official who oversees Oakland’s cannabis permit office and offered him a free trip to Spain to tour cannabis lounges there.

City Administrator Sabrina Landreth has referred Reid’s allegation to the Alameda County district attorney’s office, officials said Friday. The city’s Public Ethics Commission has opened its own investigation.

Gray, who said he was seeking a dispensary permit himself and also working on behalf of another applicant, acknowledged that he offered the Spain trip to licensing official Greg Minor, but said it was not a bribe. On Friday, he denied the allegations made by Reid and the two businessmen.

“It’s very unfair and not true,” Gray said. “I didn’t do anything.”

Reid’s allegation came to light this week after he reported it to Landreth. The alleged bribery incident, however, occurred several weeks ago, Reid said. He did not explain why he had waited to report it. No city ethics law requires someone report another person’s wrongdoing. Reid also did not mention the alleged bribe attempt in an interview with The Chronicle two weeks ago, when he first acknowledged having met with Gray.

He mentioned the meeting at that time in response to questions about the allegations raised by the two permit applicants who said they’d also been approached by Gray. The men said Gray told them he worked with Reid and Councilwoman Desley Brooks.

The two men spoke to The Chronicle on the condition their names not be used because they were concerned about their ability to get a license in the future. They said they decided to tell their story after two people identifying themselves as federal agents stopped one of them outside their place of business last month and began asking questions about their experiences with the city’s permit process.

The men said a mutual acquaintance set up a meeting between them and Gray in October. The men said they had never seen Gray before and didn’t know his surname. Shown a photo of Gray, both confirmed he was the man they had met.

At the meeting, they said, Gray gave them only his first name, Dorian, and told them that they needed to give him three brown paper bags filled with cash — one for him, one for Reid and one for Brooks — and that he would take care of the rest.

As proof of his connection, they said, Gray held up his iPhone to show Brooks’ and Reid’s names on his favorites screen and offered to call them on the spot.

Both Reid and Brooks said they knew Gray, but said they had no involvement with his actions.

“I know Dorian, but he is not a friend of mine. He is an acquaintance,” Brooks said. “If he’s dropping my name, it wouldn’t be the first time someone’s done it.”

Reid and Gray met years ago in East Oakland, where Gray was building single-family homes, Reid said. “Anybody can throw my name around,” Reid said. “That doesn’t mean anything.”

The businessmen said Gray had told them he made a similar arrangement with another group called the Plug, which was trying to open an Oakland dispensary. The Plug’s website says it was founded by growers who had opened a cannabis club in Barcelona.

The Ethics Commission sent a letter this week to Gray and Aidan Sciandra, the Plug’s CEO, informing them of its investigation. Sciandra did not respond to requests for comment.

It’s not clear what an Oakland City Council member could have done to influence the permit process. The city allotted eight dispensary authorizations this week, using a lottery for some qualifying applicants and a point-based system for others. Council members were not on the panel of city staff that awarded those points. More than 100 people had applied for permits.

Two weeks after their October meeting with Gray, the businessmen said, he asked to talk again. But the two said they haven’t met with him since the first encounter.

The men said their concerns grew after one of them was stopped last month outside their warehouse by a man and woman who flashed Justice Department badges. That businessman said they asked him whether anyone had approached him with anything “unsavory” in relation to his permit application. They also asked whether he was connected to people at City Hall and what it was like working with Brooks, the businessman said.

He said he told the agents he’d never met Brooks, but said he did not reveal the October meeting with Gray because he was uncomfortable with the questioning and wanted his attorney present.

A spokesman for the Justice Department’s Northern California field office said he couldn’t confirm or deny the existence of an investigation, and a spokeswoman for the Washington headquarters declined to comment.

Brooks said she’s had no involvement in cannabis permit decision-making and had no knowledge of any offers Gray may have made to permit applicants. She said Gray had called her to set up a meeting about cannabis, but she didn’t take it. She said the last time she met with Gray was more than two years ago.

Reid said Gray called him repeatedly to set up a meeting before they finally spoke for about 10 minutes in his City Hall office several weeks ago. There, Reid said, “he just opened up his coat, and there was an envelope in the inside pocket. … I said, ‘Hey man, I don’t work that way.’” Gray said there was $10,000 “with your name on it,” according to Reid, who said he didn’t actually view the cash.

As Gray was leaving the office, Reid said, he asked whether he was sure. Reid said he had rebuffed him a second time.

Reid did not explain why he had waited weeks to tell Landreth about the meeting. He said he did tell his council colleague Lynette Gibson McElhaney about the incident soon after it happened because Gray lives in her West Oakland district, and that’s where Gray was trying to open a dispensary. He said he had warned her against meeting with Gray.

Gray said he had applied for a dispensary permit himself — he wasn’t among this year’s winners — but denied doing anything improper. He acknowledged offering Minor a trip to Spain.

“That was an opportunity to help the city of Oakland out to be exposed to what’s going on,” he said of the proposed trip. “You got another country that’s already been doing this a lot longer, and to be able to get it right would be the most profound thing that one can do.”

Minor said the proposal, about a month ago, was so out of the ordinary that he reported the encounter to his supervisor, City Administrator Landreth. Neither he nor Landreth clarified when the report was made.