Mohammed Nuru
former Director of Public Works Mohammed Nuru. Photo by Lola M. Chavez

Contractor Balmore Hernandez to join restaurateur Nick Bovis, permit expediter Walter Wong in cooperating with feds’ case vs. Mohammed Nuru

Also: Woman charged with lying about gifting Nuru gold Rolex worth nearly $40,000 set to plead guilty

The United States Department of Justice today unsealed charges against Alan Varela and William Gilmartin, alleging that the Oakland-based contractors participated in bribing ousted Public Works boss Mohammed Nuru with a $40,000 John Deere tractor.

Fellow contractor and former Public Works employee Balmore Hernandez has agreed to plead guilty to this and other charges, and agreed to cooperate in the ongoing case against his one-time boss. All three contractors have been charged with a scheme to ply Nuru with gifts and/or discounted work in order to gain access to city contracts.

In a related case, Florence Kong, who owns a construction company and construction-debris recycling company with city contracts, has agreed to plead guilty to charges that she lied to investigators about gifting Nuru cash, costly meals, a gate for his Colusa County “ranch,” and a Rolex watch worth nearly $40,000. Unlike Hernandez, she has not agreed to cooperate in the case against Nuru.

Nuru was arrested by FBI agents in January, and faces up to 25 years in prison for an alleged bribery scheme as well as charges he lied to FBI agents. The Department of Justice also outlined a number of additional “schemes” for which it was not seeking punishment; rather these were included to “show state of mind.”

Contractor and permit expediter Walter Wong, right, pictured here in 2018 with ex-Public Works boss Mohammed Nuru. Photo by Susana Bates for Drew Alitzer Photography.

Germane to today’s announcements, in one of those “schemes,” Nuru was charged with reciprocating favors for contractors who performed hundreds of thousands of dollars’ worth of free or discounted labor on his ranch in Colusa County, while also bribing him with a John Deere tractor valued at more than $40,000.

Hernandez, who was charged in June, has since been revealed to be “CONTRACTOR 1” in the feds’ charging documents. Piecing together the allegations, it appears that Varela is “CONTRACTOR 3” while Gilmartin is “CONTRACTOR 4.”

Varela is the president of ProVen Management in Oakland, a civil engineering and construction firm he founded in 1991. Gilmartin is the vice president. Along with Hernandez, who founded AzulWorks in 2000 after leaving Public Works, Varela and Gilmartin are charged with bribing Nuru in a long-running attempt to gain control over an asphalt plant that was slated to operate on Port of San Francisco land at Pier 94.

Citing intercepted communications and financial transactions, the feds allege these bribes took not only the form of work on Nuru’s “ranch” — “built from scratch by contractors largely from San Francisco or the Bay Area” — and the now-infamous tractor, but “extravagant dinners for Nuru and Hernandez,” paid for on Gilmartin’s company card.

In the affidavit unsealed today, FBI Special Agent James Folger estimates Hernandez sunk more than $250,000 into work on Nuru’s dacha while Gilmartin paid more than $20,000 on meals.

Folger further charges that the tractor, valued in excess of $40,000, “was financed through one of Varela’s and Gilmartin’s companies along with other construction equipment, thereby indicating a business purpose rather than a personal one.”

The three contractors are purportedly delivered Nuru his tractor, telling him they listed the contact for delivery not under Nuru’s name, but under the first name of his girlfriend — Sandra — a purported attempt to conceal the nature of this gift.

Hernandez, Varela, and Gilmartin appear to have literally spelled out the nature of their plans with regard to leveraging Hernandez’s relationship with Nuru to land the asphalt plant deal.

With today’s announcement and this June document, we can piece together the identities of the contractors referred to obliquely.

On May 16, 2013, Gilmartin wrote an appreciative email to Hernandez, stating “I have used you to help negotiate this deal because of your ability to understand and present our proposal without making the other side nervous. For this you are entitled to ownership.”

In February of that year, Gilmartin wrote in an email that an $812.10 charge at Morton’s steakhouse was for “dinner with Mohammad [sic] head of DPW and Balmore Hernandez discussing asphalt plant deal.”

While Nuru was named in this communique, the affidavit says he was more commonly referred to as “our friend” by the three contractors. Going back to 2013, written communications between them and their friend indicate Nuru, then the head of the Department of Public Works, “was providing inside information on how DPW and the Port of San Francisco (“Port”) were approaching a Request for Qualifications/Proposals (RFQ-P or RFP) for the asphalt plant on Port land.”

As a result, the contractors had insight into both the city’s desires and the offerings made by would-be competitors. They also purportedly leveraged their relationship with Nuru to address requirements they felt to be onerous or disadvantageous.

Gilmartin also appears to have, again literally, spelled out that he understood the illicit nature of the arrangement with Nuru. From a May, 2014, email:

the back channels of negotiating are in full swing for the candlestick phase 2. I need to send a PDF file of the asphalt plant and concrete plant to [redacted well-known business person]. This will be done through back channels from Mohammad. [sic] Could you send again to me for the 10th time our proposal for the plants, a PDF file excluding the financial performas. [sic] This will be forwarded through various ways to get to him this am.

Just so you know there was a a [sic] meeting last night that figured out the left hand needs to work with the right hand and two hands are better the one!!! Please keep this information between you and me. All deals can blow up. Loose lips sink ships.

It’s not a done deal, keep your figures crossed this could be great for us

The affidavit alleges that Hernandez and Nuru coached Gilmartin on how to respond to questions prior to his appearance before a panel weighing the bids for the asphalt plant — even while, in communications between Varela and Gilmartin, they admitted that they did not have the qualifications or experience to run an asphalt plant, and were, to boot, short on funds.

And yet, by 2016, the Port Commission had formally adopted an exclusive negotiation agreement with Varela and Gilmartin’s joint venture; as Gilmartin had prophetically emailed one year earlier, “don’t worry … this is set up for us to win.”

Negotiations regarding the plant, however, stretched on for years. As did work on Nuru’s ranch. Lavish monthly or bi-monthly dinners at a San Mateo restaurant during which terms and conditions for the elusive asphalt plant were allegedly discussed and smoothed out continued “through at least early 2019 and likely later.”

20200917 Varela Gilmartin C… by Joe Eskenazi

The affidavit unsealed today also reveals that Varela was in contact with longtime city contractor and permit expeditor Walter Wong, who in June pleaded guilty to charges of fraud and conspiracy to commit money laundering. Wong — aka “CONTRACTOR 2” — is now cooperating in the case against Nuru.

Varela traveled to Chile in 2018, along with Wong, Nuru and Nuru’s girlfriend, Sandra Zuniga, on a trip the feds allege was “heavily subsidized” by Wong. Zuniga, who worked in the mayor’s office, was charged with money-laundering in June.

In February, 2019, the tractor was delivered to Nuru in Colusa by Hernandez and Varela, per today’s affidavit. Varela purportedly signed the invoice and told John Deere employees he was in a rush to get it delivered. It appears Varela also bought a cheaper tractor and had it delivered to his own residence in Napa.

Varela and Gilmartin are charged with bribery of a local official. The maximum sentence calls for 10 years imprisonment and a $250,000 fine.

Following Nuru’s January 2020 arrest, incidentally, Public Works and the Port scrapped their years-long plans for the asphalt plant.

We promise to keep you informed. Keep us reporting by supportingMission Local today.

Follow Us

Managing Editor/Columnist. Joe was born in San Francisco, raised in the Bay Area, and attended U.C. Berkeley. He never left.

“Your humble narrator” was a writer and columnist for SF Weekly from 2007 to 2015, and a senior editor at San Francisco Magazine from 2015 to 2017. You may also have read his work in the Guardian (U.S. and U.K.); San Francisco Public Press; San Francisco Chronicle; San Francisco Examiner; Dallas Morning News; and elsewhere.

He resides in the Excelsior with his wife and three (!) kids, 4.3 miles from his birthplace and 5,474 from hers.

The Northern California branch of the Society of Professional Journalists named Eskenazi the 2019 Journalist of the Year.

Join the Conversation


Please keep your comments short and civil. Do not leave multiple comments under multiple names on one article. We will zap comments that fail to adhere to these short and very easy-to-follow rules.

Your email address will not be published. Required fields are marked *

  1. ProVen Management has a long and sordid history with Dennis Herrera, particularly their washing of campaign funds through ProVen’s employees. It was exposed in 2011 by Matier and Ross at the Chronicle, but left to wilt and be forgotten. Hardly news and not surprising.
    Why Gilmartin and Varela were so interested in getting cozy with the City Attorney?
    ProVen employees wrote checks for $500 to Herrera’s campaign and were then reimbursed by Varela. With never having to pay any sort of price for this, Varela learned that there was no down side for breaking laws when it came to City of San Francisco officials.

  2. Thanks for the article, thanks for the work. Some people don’t realize how hard it was to compete against a stacked deck. They may seem like small fish nationally but for people trying to do work in SF they presented a huge roadblock.

    1. Al, The Article is just a cut and past from the Government Press Release. I bet you work for the Government and you never had to compete against any contract. We all know it is still stacked if favor of the Big players these other low level contractors are just sacrificial lambs. From your comments I bet you had something to do with setting up the “little fish” makes you feel justified sending the little pep’s up the river.

  3. Great journalism! The Feds ain’t playing and there’s too many trails for them and the IRS to track. Stay tuned they are just getting started ????

  4. Good article Joe. Looks like a lot of birds are singing right now, trying to cop deals. I can only surmise that this will go even higher in the City power structure.

    On a different note, how arrogant and blatant these people were, to include such obviously incriminating details in unsecured emails. They all thought they were untouchable. It’s good to see them getting slapped around.

  5. President Trump has now weaponized the DOJ to go after all Democrat controlled cities. By Trump appointing the new Prosecutor for northern district of California they are told to find any little infraction i.e…. casual corruption (friends helping friends) which SF has found to be working for a 100 years. The way it works is the FBI comes in and sets up small fish to get to the big fish. Feeds the media spin chum to cause infighting with progressives. They all eat each other while Trump out played us all in a 3 level chess game. As a big picture overview Trump blames or throws counter accusations at us for using the FBI during the 2016 election while he weaponized the Justice Dept. to go after the Democrat run Cities. He will do anything to destroy and divide our great city of SF so don’t be fooled by this trumped up corruption case.

    1. Jim, you and the rest of your liberal friends will blame Trump for any and everything. This city has been corrupt for years, and this piece of garbage, Nuru, and his collection of idiots need to be in prison.

      London “Broil” Breed, is the next clown that will be ousted. Her connection with Nuru is going to come to a boil soon. Her ass was saved by the Pandemic in the beginning and the only reason she’s not loosing the purse strings on things now is to keep her ass off the fire as long as she can.

      One would think people would welcome a crack down on local, city government corruption. Hell, the liberals have been looking for everything under the sun to get Trump out of office.

      1. Terry guess you have been watching a lot of Fox news. You may have missed something even you should be worried about. Also I noticed Mission Local seems to get the story before the Fed’s official news release hope they are not playing you and your federal government commentators.

        Worry about this
        President Donald J. Trump Announces Seventeenth Wave of United States Attorney Nominees and Twelfth Wave of United States Marshal Nominees
        On August 16, 2018, President Donald Trump announced his intent to nominate Anderson to be the U.S. Attorney for the Northern District of California. On August 27, 2018, his nomination was sent to the United States Senate. On January 2, 2019, his nomination was confirmed by voice vote.
        Please look into what is really going on Anderson comes in on January 2019 and in 1 year shakes our city with a bunch of weak trumped up casual corruption cases. Next step is take out the mayor, city administrator, and maybe he can connect the dotes up all the way to the Governor ? Every Democratic run city has a new Trump appointed US attorneys.
        Anyway the press and the local government will continue to bad mouth and attack each other about exaggerated corruption cases while Trump and his newly appointed Army of US Attorneys, Marshals, and Judges will be masterminding the take over.

  6. This indictment comes as no surprise to me. ProVen Management (as a company) and their management team are absolutely sleazy. When you hear people talk about sleazy low-bid government contractors, ProVen fits the bill. I once heard Bill Gilmartin say that he owns his own company and so he has no boss and can do whatever he wants. Well, Alan and Bill have a new boss, his name is Dave Anderson. Hey Dave, Alan and Bill need a little disciplining. Throw the book at them and get the maximum penalty. Or, maybe, give 6 months off if they cooperate and start naming all the other sleazy government employees that accepted bribes and gifts, and very expensive meals. That must have been some good meat and potatoes served up with some expensive alcohol. No wonder the ProVen overhead rate is so high! Government agencies should get a rebate on some of the exorbitant change orders they paid to ProVen.

    Joe, thanks for writing a detailed, fact-filled article. You are the only one in SF that is doing this. Journalism at it’s finest.

    1. I believe if he’s convicted of a felony related to work, he loses his pension. Not completely sure, but pretty confident.