LATHROP – Sonny Dhaliwal’s 2010 city council campaign received $17,500 in loans from businesses and community leaders over a 14-month period.

It failed to disclose $4,600 in campaign contributions and deposited them into a personal bank account.

At least that’s what the California Fair Political Practices Commission alleges in a decision and order that was made public Monday when it was placed on the group’s agenda for its next regularly scheduled meeting.

The document – which is legally binding should it be approved – carries with it a fine of $21,000 that will be levied against “Sonny Dhaliwal, Sonny Dhaliwal for Mayor 2010 and Sarbjit Dhaliwal.”

The levy will count against Dhaliwal’s political committee, and will count against any contributions that he receives if he were to solicit them for a run at a second mayoral term in 2014. 

Dhaliwal, who was elected in a contentious battle in 2012 and surrendered the remaining two years of the city council seat he won two years prior, is said to have violated the Political Reform Act – passed in 1974 and policed by the FPPC, which operates like the Federal Election Commission to ensure fair and unbiased elections.

When presented with the opportunity for a probable cause hearing and an administrative hearing under the Political Reform Act, the decision and order states, Dhaliwal and the campaign representatives, under the advice of private counsel, waived all rights and allowed the matter to move forward to a default decision.

“In 2010 I was dealing with a family matter and mistakes were made and when they were brought to my attention, I did everything possible to make sure they were corrected and the necessary amendments were made,” Dhaliwal said. “I fully cooperated with the FPPC and gave them all of the records they requested and now have the help of a professional to do all of my filings so that the same mistakes aren’t repeated. A lot of these filings and rules are very complicated for average persons. 

“But this experience has made me a better person than I was four years ago. I’m fully committed to serve the people of Lathrop – this is the first mistake in all 11 years of serving those people, and I sincerely regret it.”

According to the language in the charge that will be addressed at the meeting on June 19, Dhaliwal is accused of:

• Failing to disclose contributions received: A total of eight campaign contributions were left off of filing statements. All of the donations came during a five-month period from May of 2010 through October of 2010, and, seven of the contributions weren’t listed on campaign contribution disclosure forms until three years after they were made. The campaign donations, totaling $4,600, came from M&J Transportation, Dhoot Bros. Partnership Inc., Ranjit and Meena Chandowalia, Balbir and Jogjinder Bhangal, Sodhi and Jaswinder Sidhu, K S Trucking, Dhaba Indian Cuisine and Balwant Sandhu. Sandhu’s contribution was disclosed in January of 2013 – the earliest of the eight that were listed as problematic. According to the document, he made it Oct. 20, 2010. Sandhu, who was a candidate for city council, made a public declaration that he donated $500 to Dhaliwal’s campaign and the check was cashed but never disclosed. He accused Dhaliwal during a public meeting of “money laundering activity” and told the council that he would be referring the matter to the FPPC for an investigation. The Bulletin obtained a facsimile copy of the check – it was posted to an account on Nov. 8, 2010, but wasn’t disclosed until three months after Sandhu raised the issue in the public forum.

• Failing to disclose economic interests: During a 14-month period from April of 2010 through June of 2011, Dhaliwal allegedly received $17,500 in loans that he never included as sources of income. The loans came in the form of five separate checks – three of them, totaling $7,500, came from Sandhu – and failing to disclose them was a violation of the government code.

According to the report, Dhaliwal’s campaign exhibited a pattern of activity that required investigation and upon further review, revealed glaring inconsistencies and violations that warranted financial penalties.

“Failing to disclose contributions totaling $4,600, which were deposited into a personal bank account, is more egregious than typical non-disclosure violations,” the order reads. “The failure to disclose the contributions, combined with the fact that these contributions were donated into a personal bank account and neither reimbursement nor disclosure occurred until 2013 when the FPPC investigation commenced, warrants higher fines.”

The report goes on to explain that during an interview, Dhaliwal explained that during his 2010 campaign he was under duress due to family illness and didn’t have a dedicated treasurer at the time – relying on friends and family members to take care of the financial details of the case.

Dhaliwal did, the report says, cooperate fully with the investigation – producing personal bank records when asked, hiring a professional treasurer to handle all financial matters moving forward and fixed all past campaign reporting mistakes and errors.

With respect to the loans that he received, the commission found no evidence that he voted on any issue involving the businesses or individuals involved in those transactions.

But the damage, the report said, is in removing the public transparency that the public has come to expect during campaign cycles.

“The public harm inherent in these types of violations, where pertinent information is not disclosed by the committee, is that the public is deprived of a means to discover the identity of contributors, the amount contributed, and the nature of the committee’s campaign expenses,” the commission wrote. “Failure to disclose income on a statement of economic interests deprives the public of knowledge about the economic interests of public officials.”