Document Illuminates Official’s Ties to Gemcoin Founder

John Wuo. - File Photo by Terry Miller

John Wuo. – File Photo by Terry Miller

Mansionization Debate Continues to Dominate Discussion at Arcadia Council

By Joe Taglieri

An Arcadia resident presented a document at the Arcadia City Council meeting Tuesday that shows a current business relationship between Councilmember John Wuo and the founder of Gemcoin, a controversial “cryptocurrency” investment product. Meanwhile, the debate among council members and residents over mansionization continued to build intensity.

Highlands neighborhood resident David Arvizu provided council members with a form from the California Secretary of State showing that Wuo and Gemcoin founder Steve Chen are principals in 24 HD Surveillance, a limited liability corporation based in Arcadia.

According to the “statement of information” document filed in January 2014 and approved by the state in March of last year, the company’s address is 135 E. Live Oak Ave. This is the same address as Chen’s companies affiliated with Gemcoin – USFIA Inc. and Alliance Financial Group.

The secretary of state’s website indicates 24 HD Surveillance is an “active” company.

After Arcadia Weekly in July revealed Wuo’s prolific presence in Gemcoin marketing material that emphasized his mayoral title and endorsement of the cryptocurrency, the councilman – in addition to denying the accuracy of the glowing product endorsements attributed to him – downplayed his connections to Chen, Gemcoin, and the entrepreneur’s numerous business ventures based on Live Oak Avenue.

Council Member Tom Beck said in an interview that Wuo did not attend the council meeting Tuesday because he was in Arizona for an event pertaining to Farmers Insurance Group. Wuo’s bio on the city’s website describes him as a member of the Board of Governors for Farmers Insurance Exchange.

Wuo did not respond to requests for comment Wednesday.

The longstanding councilman, who in April completed a third term as mayor, has previously stated that he did real estate consulting for Chen and claimed his current affiliation with Gemcoin was “ceremonial” in the capacity of a sitting mayor encouraging a local business. Until now, however, his apparently non-ceremonial affiliation with an active company tied to Chen and others affiliated with organizations connected to Gemcoin was not publicly known.

In addition to Wuo and Chen, the state document lists “Solomon Sakurada,” who also goes by the name Solomon Yang, as a 24 HD Surveillance executive. Yang, Chen, and Wuo are members of the U.S. China Consultation Association, or UCCA, which is headquartered at 135 E. Live Oak Ave. and was described in Gemcoin marketing material as a firm closely associated with the investment product.

The document also lists George Klau and Fei Li as 24 HD Surveillance executives and states “surveillance cameras” are the “type of business” the company conducts.

“I have asked the City Council to take a stand on this, make a statement, draw a line somewhere in the sand to show where you are,” Arvizu told the council. “So far you haven’t done that.”

Arvizu said he will soon file a complaint against Wuo with the Fair Political Practices Commission.

Epoch Times, a Chinese-language publication, last week reported on a group of protesters that gathered on Aug. 28 at a Gemcoin event in Ontario levying fraud allegations against Chen and USFIA.

Arvizu said he intends to invite this group to an upcoming council meeting.

- Photo by Terry Miller

– Photo by Terry Miller

A familiar discussion topic at Arcadia City Council forums this year has been the hot-button issue of mansionization, and the most recent public session on Tuesday was no exception.

A number of residents criticized the council majority for ignoring residents’ demand for limits on the size of new homes, while a smaller contingent voiced approval for safeguarding the rights of land owners and real estate professionals to maximize profits from home sales.

Mayor Pro Tem Roger Chandler shared his concern with a proposed ballot initiative that seeks to establish limits on a newly built home’s overall square footage.

“It’s a very draconian document that indeed does slice each and everybody’s property value significantly,” Chandler said, estimating the proposed home size limits would reduce land values by 40 percent.

“That means that a builder that wants to build a house on your property, because of these restrictions can build 40 percent less,” Chandler explained. “And quite frankly, builders continually say ‘you tell us what the new laws are, we’ll build to them. … We’ll just pay $500,000 less for the lot, and our profit margin will stay the same.'”

The Mayor Pro Tem then emphasized that homeowners would bear the brunt of the loss resulting from square-footage restrictions.

“I currently support the current zoning, I plead with you to not change it [because] if you do it would devastate the value of my property,” said local homeowner John Chow. “There are a lot of people right now who are very fearful of any action because it would devastate their home values.”

Thanh Lim, a member of the Santa Anita Village Homeowner Association, spoke in favor of limiting square footage and chastised council members for too often siding with real estate developers instead of residents.

In an email Wednesday Lim questioned Chandler’s assertion of the proposed ballot initiative and his remarks about the threat size limitations may pose to property values.

“He claims that the housing value will drop by 40 percent,” Lim said. “The [HOA’s architectural review board] has been approving houses at around 35-38 percent [of the total lot size] in the Village area. … The new regulations will keep it about that number. Those houses have been selling over $2 million, and a tidy profit has been made.

“It is unlikely that the new regulations that state 35 percent for two-story and 40 percent for single-story will adversely affect the housing value as it’s about the same numbers that we currently build,” Lim deduced. “There is no ‘drop in value.’ A drop of 40 percent would put housing prices in Arcadia into the realm of the lower end of Temple City and parts of Rosemead.”

Mayor Gary Kovacic failed to gain a third vote in addition to Beck’s to direct city staff to analyze the recently proposed ballot initiative, which is in the very early stages of approval procedures and needs more than 3,000 signatures from Arcadia’s pool of registered voters to qualify for the April election.

The mayor explained his intention was to allow for a more fact-based, formal public forum on the matter.

“I would have thought it would be premature to be talking about the substance of a ballot measure that hasn’t even been on the ballot,” Kovacic said. “My feeling is I don’t know what to think about the ballot measure yet, but it’s a logical result of filling a void when we’ve collectively as a city council decided to bring our residential zoning code update to a complete halt.”

Kovacic was referring to the council’s 3-2 vote to suspend a revamp of construction rules pending the outcome of a lawsuit filed in March by Arvizu and a group of Highlands residents that aims to block two proposed residential construction projects that will replace smaller homes built in the mid-20th century with significantly larger houses.

September 2, 2015

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