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SF’s chief building inspector named in fraud scandal

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Mayor London Breed says DBI Director Tom Hui must leave in wake of allegations

A midrise building under construction, with rows of glass panels along the facade. Photos by Patricia Chang

The ongoing fraud investigation into the massive and delayed 555 Fulton project in Hayes Valley, prompted by allegations against former SF Public Works leader Mohammed Nuru, has now ensnared Tom Hui, director of the city’s Department of Building Inspection. City Attorney Dennis Herrera has accused Hui of accepting bribes from the building’s developer.

The five-story, 139-unit mixed-use development in Hayes Valley, which broke ground in 2014, remains unfinished. Suspicion of bribery, secret dealmaking, and quid pro quo related to the troubled project attracted the attention of the FBI and now an internal city investigation focused on Nuru, restauranteur Nick Bovis, billionaire developer Zhang Li, and powerful SF permit expediter Walter Wong, all suspected of illegal doings.

Now Hui’s name joins the list.

Who is Tom Hui?

Hui is the head of the Department of Building Inspection (DBI), the city agency that enforces SF’s building and housing codes. He took over the job as acting director in 2012 and then moved into the position full-time in 2013.

Hui began as an engineer in the city’s Public Utilities Commission in 1989—his DBI bio notes that the Loma Prieta Earthquake happened on his second day of work—and moved to a job at DBI in 1996. Before becoming director, he worked as “deputy director of plan review services,” an unexciting-sounding but highly influential job overseeing approval of building permit applications.

That rise to the top was not without controversy: In 2012, the former DBI director Vivian Day resigned, with former Building Inspection Commission member Debra Walker alleging that the resignation was to avoid being ousted at the direction of late Mayor Ed Lee, who felt that Day was too scrupulous about code enforcement.

Lee denied the conspiracy charges. Day arrived in 2008 in the wake of another corruption investigation, one focused on former DBI manager Gus Fallay (eventually acquitted on all charges). The excitement, it seems, never ends.

What are the accusations?

The new allegations are another extension of the ongoing corruption scandal centered on former Public Works head Mohammed Nuru, whom both the FBI and the city attorney accuse of making and accepting bribes to benefit billionaire 555 Fulton developer Zhang Li and powerful development deal-broker Walter Wong.

Herrera now says that Hui is the unnamed person referred to in the FBI’s 79-page complaint against Nuru as “DBI Official 1.” In a preliminary report to Mayor London Breed, which both Herrera and Breed published on Tuesday, the city attorney accuses Hui of accepting bribes in the form of gifts, meals, and personal favors, in exchange for “intentional preferential treatment.”

In one incident, Hui allegedly went to dinner with a cadre of Zhang associates in Chinatown, later telling city lawyers in a February interview that Zhang paid for the meal, his share of which came to about $30. Herrera alleges that although the dinner was probably more expensive, even this modest sum would violate DBI rules.

“I should not have done it,” Hui said in the interview, saying he could not defend his decision to accept a developer’s gift. Since Zhang and Hui had no existing relationship, the Chinatown meeting strongly suggests that Zhang received “special access” to Hui, according to the complaint.

As far back as 2008, Hui gave Wong “unprecedented access” to the inner workings of DBI, according to Herrera, and in exchange Hui bartered Wong’s influence for personal favors, such as helping net City Hall jobs for Hui’s son and his son’s girlfriend. Investigators note that Hui used his private email—and not his city-issued account—to talk with Wong, potentially an indication that he knew the communications were inappropriate.

The FBI investigation is separate from the city’s probe. As with its subpoenas of parties involved with 555 Fulton’s development, the city attorney is commenting publicly on an ongoing inquest in a bid to appear transparent in the face of public interest.

There’s one other potentially interesting complication in all this: Mission Local previously reported that much of the paperwork for 555 Fulton that should have been on file with DBI either never existed or went mysteriously missing (temporarily in some cases).

DBI records are often spotty, and security measures that could catch a lot of potential manipulation aren’t in place. A new online system has been delayed for almost a decade. Hui has pledged to reform the record keeping process in the past, but hitherto it’s never happened.

What happens now?

For the record, the allegations against Hui are not proven and he has been neither arrested nor formally charged with any wrongdoings. Hui has not yet returned requests for comment.

Mayor Breed placed Hui on leave Tuesday, asking the Building Inspection Commission to remove him from his position. She expressed the opinion that “the city attorney’s report shows a number of legal and ethical violations.”

Herrera believes that Hui is likely guilty of fraudulent acts beyond what he’s currently suspected of. The FBI has not as of yet named Hui as a suspect to any crime.

As for 555 Fulton, the building remains in limbo, though sales on condos are ongoing despite a firm move-in date.