LA Sheriff's Department Probes Ties to Convicted Swindler

The Los Angeles County Sheriff’s Department is reviewing its partnerships with a charity founded by Daniel L. Gordon, a convicted Wall Street swindler, after admitting the agency was unaware of his criminal history and substantial tax liabilities. Gordon, who was sentenced to 3 1/2 years in prison for embezzling $43 million from Merrill Lynch, also owes New York State nearly $60 million in unpaid taxes.

The department has stated it is assessing its relationship with Gordon Philanthropies and is attempting to gather more information by contacting former personnel who might have relevant knowledge. This review is ongoing.

Gordon was banned for life in 2003 from serving as an officer or director of a public company by the Securities and Exchange Commission as part of a settlement related to the Merrill Lynch theft and other alleged misconduct. Despite these sanctions and his tax debt, Gordon has maintained a public profile in California through his philanthropic work.

Gordon Philanthropies has supported various initiatives within the Los Angeles County Sheriff’s Department, including programs aimed at improving custody conditions, supporting employee wellness, and providing safety equipment for deputies. The charity has also funded projects such as a children's library at the Men's Central Jail. Sheriff Robert Luna has participated in public events with Gordon, including a ribbon-cutting ceremony for the library in September 2023.

The Sheriff's Department has indicated that while it has policies and procedures to ensure partnerships are conducted lawfully and appropriately, it is now evaluating its processes in light of this situation. Individuals granted access to custody facilities are subject to security screenings and are escorted by personnel. The department has not specified when the partnership began or who initially approved it.

The California Department of Corrections and Rehabilitation has also previously partnered with Gordon Philanthropies to establish educational centers at fire camps. Gordon's significant tax delinquency, reportedly over $59 million to New York State, stems from his past financial crimes, as ill-gotten gains are considered taxable income. He resides in a $5 million estate in Rancho Mirage, California.

Fresh allegations of financial misconduct have also surfaced in a pending civil lawsuit in Manhattan, which claims Gordon secretly controlled Sagaliam Acquisition Corp., a Nasdaq-listed special purpose acquisition company, in violation of his SEC ban. The suit alleges he used Alan Ginsburg, a Florida real estate developer, as a front man. Representatives for Gordon and Gordon Philanthropies did not immediately respond to requests for comment. Newsom's office has also not responded to inquiries regarding Gordon's past.