A developer accused of misappropriating up to $20 million from a failed solar project in eastern Los Angeles County allegedly pilfered more than $5 million of the taxpayer money to avoid foreclosure on a La Jolla mansion, pay off old debts to his longtime attorney and finance his daughter’s multimillion-dollar wedding in the French Riviera that featured a $360,000 performance by Italian opera singer Andrea Bocelli, according to new court filings.
In September, the Los Angeles County District Attorney’s Office charged the developer, William Barkett of La Jolla, with embezzlement, grand theft, money laundering and misappropriation of public funds. Prosecutors allege more than $8 million given to Barkett to develop the solar farm on behalf of the City of Industry was instead spent on “personal items.”
Until now, there have been few details on where those funds may have gone.
A new court filing by Industry, in its separate civil case against Barkett, alleges he used at least $5.3 million from the project to maintain his family’s extravagant lifestyle and to cover money he owed from other failed projects. The city sent out a series of demand letters to Barkett’s wife, son and daughter, as well as his long-time attorney, David Gilmore, requesting they turn over documents and return any funds they purportedly received from two companies tied to Barkett, San Gabriel Valley Water and Power LLC and BMF Limited LLC.
The city alleges it was the only source of revenue for the two entities.
The rolling hills and grassy land of Tres Hermanos Ranch, a 2,450-acre preserve owned by City of Industry, between Diamond Bar and Chino Hills on Jan. 28, 2019. (Photo by Watchara Phomicinda, The Press-Enterprise/SCNG)
“We’ve reviewed thousands of pages of documents and they indicate there was a misuse of funds that were supposed to go to the preparation of studies and analyses for the solar project,” said Jamie Casso, Industry’s city attorney. “But, instead, they went to support a lifestyle.”
Industry entered into an agreement with SGVWP in 2016 to develop a 450-megawatt solar farm on land known as Tres Hermanos Ranch straddling Diamond Bar and Chino Hills at the intersections of Los Angeles, San Bernardino and Orange counties. At the time, Barkett owed more than $50 million from past defaults. Yet, Industry gave SGVWP more than $20 million over two years with little oversight. Two subcontractors would later allege SGVWP altered their invoices and inflated billings.
Industry sued to try to get its money back. SGVWP counter-sued, arguing the city had violated the lease agreement by not allowing the project to continue.
“It is probably the strategy of the city to somehow divert attention away from their wrongdoing, their breach of contract, their actions …”
— Bill Seki, criminal attorney for William Barkett
Bill Seki, who represents Barkett in the criminal case, said the city’s allegations are false. His client complied with the terms of the lease agreement with the city, Seki said.
“It is probably the strategy of the city to somehow divert attention away from their wrongdoing, their breach of contract, their actions which would have put them in liability to Mr. Barkett and all of the other entities they’re trying to sue,” Seki said.
In a statement, San Gabriel Valley Water and Power, through a letter provided by Gilmore, indicated its project — which it described as a 165 megawatt solar microgrid — would have benefited the region, but that Industry made “demands that betrayed the basis of the project’s economic and environmental intent.” The city lodged erroneous allegations against Barkett, his family and the company in the aftermath, the company alleged.
“Mr. Barkett categorically denies the legal validity of those allegations,” the letter states. Once county prosecutors “come to understand the totality of the facts, those facts will vindicate Mr. Barkett’s good name, and everyone will come to understand the terrible consequences to the environment and local economic development that this instance of government chicanery caused,” according to the statement.
The French wedding
Industry asserts the misused funds from the solar project include $1,916,546 that the companies spent on Barkett’s daughter, Jacqueline Chervak, from 2016 to 2020, according to a letter from the city to Chervak. Most of the money — roughly $1.7 million — purportedly covered expenses for Chervak’s October 2017 wedding in Antibes, France.
An exterior view of luxury Hotel du Cap Eden Roc in Antibes, southern France. (AFP via Getty Images)
The wedding was held at the luxurious Hotel du Cap-Eden-Roc on the shores of south France near Italy’s border. The hotel is world famous for serving as a “home away from home” for artists like F. Scott Fitzgerald, Picasso and John Lennon, as well as a retreat for political leaders, including John F. Kennedy and Winston Churchill, according to Town and Country magazine.
From the two business accounts connected to the solar project, Barkett allegedly paid $14,000 for a private jet, $44,000 for photography, $386,000 to the hotel, $650,000 for floral arrangements and event production, and $356,269 directly to Bocelli, among other costs, according to a list of expenses attached to the demand letter sent to Chervak.
In 2015, Business Insider described the wedding planner hired by Barkett as “one of the most sought after wedding planners for the richest people in the world,” with clients including Fortune 500 businessmen, princesses and pop stars.
A video produced for the wedding shows an aerial shot of Barkett walking his daughter down the aisle to a sun-drenched ceremony along the Mediterranean Sea, guests partying among wall-to-wall floral arrangements and flashing lights while multiple bands perform, and, very briefly, Bocelli, the opera singer, crooning on the couple’s big day.
Jeffrey Mitchell, an attorney for Chervak, denied any wrongdoing on the part of his client. The city’s demand for recompense is “not supported by the law,” he said.
“She never worked for her father, she never had anything to do with his businesses, she knows nothing about any of this,” Mitchell said in an interview. “People are trying to drag her into this simply because she is her father’s daughter.”
Wedding cited in other suits
Industry isn’t alone making allegations that Barkett funded the wedding from his companies’ accounts.
George Stephan, the brother-in-law of Barkett’s wife, socialite and former USC Trustee Lisa Barkett, separately sued the couple in 2019 for failing to make payments on more than $4.2 million in loans and interest. In the lawsuit, Stephan’s attorneys alleged Barkett had promised a big payday once the solar project was finished and even wrote a $75,000 check to the Stephans from one of SGVWP’s accounts in 2017.
The loan agreement bound not only Barkett, but his current and future companies, to cover the debt, according to Jerome Friedberg, an attorney for the Stephans.
“He’s spending all of this money on his daughter’s lavish wedding at a time when he owes his family — his brother-in-law — a large amount of money that he wasn’t paying back,” Friedberg said.
The Stephans later brought Chervak into their case as well, alleging she and other siblings “acted in concert and aided and abetted William and Lisa Barkett to hide William and Lisa’s ownership of the assets and defraud William and Lisa Barkett’s creditors.”
A court ruling on a motion to quash a summons of Chervak, who lives in New York, in the Stephan case indicates that “the parties do not dispute that William Barkett signed and wrote the checks and deposited the checks into Defendant Chervak’s account.”
“During her deposition, Jacqueline Chervak admitted that she was aware of her father making these deposits in California into her account,” the court filing states. It also alleges Chervak “admitted during her deposition that she had a role in selecting the wedding photographer” whom Barkett paid $44,000 with checks from the SGVWP account.
The City of Industry alleges a developer spent $1.7 million meant for a solar project on his daughter’s wedding at the Hotel du Cap Eden Roc in Antibes, France, pictured here in an Instagram post by the event producer. (Via Instagram)
The full deposition was unavailable because it is sealed.
Asked about the ruling, Mitchell restated that Chervak “denies she did anything wrong.”
“I think this is a real reach to go after the daughter of somebody like this,” he said.
Chervak was featured on the first episode of MTV’s “My Super Sweet 16,” in which she and a friend dreamed of hiring Beyonce (the singer ended up wanting $500,000) or the Red Hot Chili Peppers to play at their birthday bash. They ended up with the punk band “Unwritten Law” and posed for pictures with actor Pauly Shore at a packed party at the Hard Rock Cafe. In the episode, Chervak — then Jacqueline Barkett — stated she didn’t believe the party would cost more than $100,000.
In 2006, CNN reported that Chervak landed an internship in the office of Sen. Harry Reid, D-Nevada, after her father donated $41,700 to Democratic campaign committees. Chervak went on to work for the U.S. Department of State in Italy, attended Fordham University in New York and earned her law degree. She went to work for the U.S. Attorney’s Office in Washington, D.C., the Federal Reserve Bank of New York’s Financial Crimes Unit and, most recently, as a clerk in the Southern District of New York, according to a declaration in the Stephan case.
Besides assisting his daughter, Barkett is alleged to have used $2.1 million of Industry’s funds to avoid foreclosure of the La Jolla mansion he lives in.
In November 2017, roughly a month after Chervak’s wedding, Industry made three payments totaling $1,985,945 to SGVWP to cover invoices and advance requests related to the solar project.
The city alleges Barkett transferred $860,601 from a SGVWP account and $900,000 from BMF Limited to Chase Bank within two days of Industry’s final payment on Nov. 28. The next month, Chase rescinded a 4-year-old notice of default on Barkett’s mortgage. A notice related to the foreclosure process indicated Barkett and his wife had an unpaid balance of $6.3 million eight months earlier.
Other check and wire transfers, totaling $404,743 “traceable to the city,” were used to make additional mortgage payments, according to a demand letter sent to Lisa Barkett. She could not be reached comment.
Property records indicate Barkett and his wife transferred the deed for the mansion to Silverado Street LLC in January 2014. Barkett registered the LLC less than six months earlier and is listed as the initial agent. Today, however, the company is registered to a Kuwaiti man, Amr J. Al-Jassim, who has been brought into various lawsuits as the sole member of other companies tied to Barkett, court records showed.
Barkett also is accused of giving $543,250 to his son and $760,648 to the law firm of Gilmore Magness Janisse from the two companies’ accounts.
Industry alleged the payments to attorney Gilmore were unrelated to the solar project and covered his past representations, including in a lawsuit where a company received a $43.5 million judgment against Barkett and his companies. In that case, Barkett allegedly said during a debtor’s examination that he had no income or assets in his name, and that he had transferred his home to a limited liability company owned by a friend in Kuwait and furniture and artwork to others, according to appellate court records.
Reached by phone, Gilmore, who represents BMF Limited in Industry’s civil suit and Barkett’s family members in other cases, said the letter sent to him is “not accurate.”
He declined to comment further, or to speak on BMF’s behalf.
“When Bill Barkett has money, everybody knows it. He doesn’t pay the people he owes, he starts spending it.”
– Howard Justus, a Barkett creditor
One of the creditors on Barkett’s home is a company owned by Anthony Bouza, an attorney whom Industry hired to negotiate the solar project deal. Bouza, along with former Industry City Manager Paul Philips and former state Sen. Frank Hill, also have been charged by the District Attorney’s Office for their roles in the project. All four men are expected to be arraigned within the next month.
City officials previously said Bouza did not disclose the potential conflict. The deal negotiated by Bouza on behalf of Industry was largely in Barkett’s favor and required his companies to pay back Industry’s loans only if the project broke ground. It never did.
Howard Justus is the president of an investment firm that has sought to collect on millions owed by Barkett for nearly a decade. Justus said his firm took note of the sudden change in Barkett’s financial status at the end of 2017, when the home’s notice of default was removed and Chervak’s wedding took place.
“We were seeing that all of a sudden he was flush, and we couldn’t figure out from where,” Justus said. “When Bill Barkett has money, everybody knows it. He doesn’t pay the people he owes, he starts spending it.”