Billionaire Los Angeles real estate magnate and newly minted mayoral candidate Rick Caruso’s business dealings have the potential to create a deluge of conflicts of interests should he pull off his quest to lead the City of Angels, but he says he has a plan to ensure no funny business takes place on his watch.
The Los Angeles Times is reporting that if elected, the 63-year-old plans to remove himself from the day-to-day operation of his eponymously named company, Caruso, by stepping down as its CEO and putting it into a blind trust headed by its chief development officer, Corinne Verdery.
The company, which owns and operates billions of dollars worth of commercial properties in Southern California including The Grove, would then continue to be run by Verdery after Caruso steps out of political life, with Caruso claiming he would would return as its executive chair.
Caruso, who officially joined the race for mayor on Friday, promised he would have no say in the dealings of his business, following the protocols of a blind trust, which are put in place so those walking the tightrope between business and public life avoid conflicts of interests when making decisions.
“She has full authority to operate,” Caruso said of Verdery.
The newspaper reported that Caruso has said his company will not launch any new real estate developments in Los Angeles if he is elected mayor, but company leadership, which will also include Chief Financial and Revenue Officer Jackie Levy, and General Counsel Ben Howell, would expand its range of investments.
It is still typical for leaders who have blind trusts in place to recuse themselves from official matters that involve their company’s holdings.
Business dealings between Los Angeles’ City Hall and developers have been under the microscope recently thanks to a series of corruption scandals, including a “pay to play” probe that resulted in guilty pleas from two real estate consultants, a lobbyist, a council aide and a former city councilmember, according to the newspaper.
A Republican-turned-Independent-turned-Democrat, Caruso will face off against Rep. Karen Bass, City Attorney Mike Feuer and Councilmembers Kevin de León and Joe Buscaino for the party’s nomination in a June 7 primary.
[Los Angeles Times] — Vince DiMiceli