SAN DIEGO — A Chula Vista City Councilmember and her brother who are accused of defrauding the federal government out of more than $176,000 entered not-guilty pleas Thursday afternoon in downtown San Diego.
Council Member Andrea Cardenas and her brother, Jesus Cardenas, face fraud and money laundering charges. The San Diego County District Attorney’s Office said the two had applied for and received more than $176,000 from the federal government's paycheck protection program in 2021, through their political consulting firm, Grassroots Resources.
Jesus Cardenas had previously worked as chief of staff for San Diego City Councilmember Stephen Whitburn.
CBS 8 asked both Andrea and Jesus Cardenas for comment after Thursday's hearing, but they both declined.
Defense Attorney Pedro Bernal is representing Andrea. He said she would not be stepping down from her seat on the Chula Vista City Council.
"She's represented her constituents for a long time, she's served her community for many years. She plans to continue doing that," he said.
Both defendants are due back in court in January.
According to investigators, on the application, the Cardenas allegedly claimed to have 34 employees working for Grassroots Resources, which according to the District Attorney, was not true.
Instead, the employees listed worked for Harbor Collective, a marijuana dispensary in San Diego: a business that under federal law is illegal.
The charges also claim that Jesus Cardenas did not disclose that Grassroots Resources was a political consulting firm, which would have made the business ineligible for a PPP loan.
Those federal funds, meant for businesses struggling to stay afloat during the pandemic, were then funneled into the personal accounts of Andrea and Jesus Cardenas.
In fact, according to the DA's office, Andrea Cardenas used $33,500 of those federal funds to write a check out to her campaign for Chula Vista City Council in May 20221.
If convicted on all charges, Andrea Cardenas, who faces two additional counts of failing to file tax returns, could spend five years and eight months in state prison. Jesus Cardenas faces a maximum of four years and four months behind bars.
CBS 8 received the following statement from Councilmember Cardenas:
"On Wednesday, November 1, 2023, the District Attorney's Office notified my brother, Jesus Cardenas, and myself, that they had filed a number of serious charges against us. We became aware of many of the details of these allegations through local media outlets, who received a full copy of the complaint before we did.
Our American judicial system is built on the fundamental principle that our citizens are innocent until proven guilty. As someone who has spent more than half of my life working to support and elevate my community, I understand and respect the critical work that our District Attorney's Office does to uphold the law. While the DA's Office is tasked with the responsibility to protect our community and prosecute abusers of the law, as defendants, we are afforded the right to prove our innocence.
My intent has never been to harm or disappoint those who believed in me, both in life and at the ballot box. Many conversations are taking place around me about me and what others think is the best way for me to move forward. I would like to make one thing very clear - my commitment to my community continues. As we move forward in this process, I hope to be given an opportunity by the media, folks in political circles, and, most importantly, my constituents to defend myself."
The arraignment is set to start Thursday afternoon at the San Diego County Courthouse.
CBS 8 spoke to longtime criminal defense attorney Gretchen von Helms about this case. She is not associated with it.
"[Andrea Cardenas] doesn't have to prove she's innocent. The state has to prove beyond a reasonable doubt she's guilty," said von Helms.
She said it's possible however, Councilmember Cardenas will have to resign from her city council seat to focus on the criminal case.
"The amount of time and energy it's going to take her to address the criminal charges may take away from her ability to represent her constituents," said von Helms.
The Chula Vista Charter explains the regulations around vacancies:
(A) When a Vacancy Occurs. A City Councilmember or Mayor shall be deemed to have vacated their office on the date such office holder:
(1) is absent from four consecutively scheduled and held regular meetings of the City Council without permission or excuse approved by the City Council;
(2) is convicted of a felony or a crime involving moral turpitude;
(3) resigns from office;
(4) is sworn in to another office or position requiring the surrender of the City office;
(5) is removed from office by judicial procedure or other state law proceeding;
(6) forfeits the office under any provisions of this Charter;
(7) no longer meets the qualifications necessary to hold the position;
(8) is judicially-determined to be an incompetent;
(9) is permanently so disabled as to be unable to perform the duties of the position. A finding of disability shall require the affirmative vote of at least two-thirds of the members of the Council after considering competent medical evidence bearing on the physical or mental capability of the officer; or
(10) dies.