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Utility Consumers' Action Network (UCAN), a prominent watchdog operation, has received a subpoena to testify before a federal grand jury. In a document that I have seen, the U.S. Attorney's office wants all records relating to UCAN and a related organization, Privacy Rights Clearinghouse (PRCH); former San Diego political candidate Peter Navarro and his wife Leslie W. Lebon; Death by China Productions LLC, a group set up for making a movie of a book by the same name Navarro co-authored; Dan DiMicco, chief executive of steelmaker Nucor; Patrick McFadden, head of Nucor's public affairs, and Red Rock Partners, which presumably is Red Rock Energy Partners, a fund set up to make energy investments. Some UCAN insiders suspect that the non-profit group lost money investing funds in Red Rock.

My column of August 24, 2011, showed how North Carolina-based Nucor put $1 million into production of the China-bashing movie, but the money went first to UCAN. McFadden explained to me at the time that Navarro wanted the $1 million sent to UCAN, so the company didn't argue.

The grand jury wants financial records, contracts, consulting agreements, invoices, receipts, phone logs, written and electronic correspondence, investment promotional materials, investment statements, and documentary production reports from UCAN. In addition, the U.S. Attorney's office wants records of "all payments to Michael Shames [UCAN's chief executive], including salary and bonuses and travel/expense reimbursements." A previous Reader article showed that Shames was claiming to be a lawyer and filing for intervenor payments from the California Public Utilities Commission (CPUC) as an attorney, although he was not a member of the State Bar. He has since rejoined the bar.

The grand jury also requests "All financial reviews or audits performed on UCAN or PRCH books; and identification of all financial institution accounts used by or held for the benefit of UCAN or PRCH."

As stated previously in the Reader, a group of whistleblowers within UCAN has protested conditions there and has been especially concerned about what they suspected to have been financial irregularities.

Pictured: Michael Shames

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Comments

Don Bauder Feb. 27, 2012 @ 3:30 p.m.

UCAN TO COOPERATE: Employees of UCAN were told today that the nonprofit watchdog would cooperate with the federal investigators, but that staff people should not comment. Best, Don Bauder

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Visduh Feb. 27, 2012 @ 3:55 p.m.

Just when we need UCAN functioning at its best and strongest in this current liability rip-off hearing, it is being investigated. Something tells me that it has been diverted into other activities and efforts that principally benefit Shames and his cabal. This should not, I repeat, NOT be happening to an organization with UCAN's mission. It must be always above reproach.

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Don Bauder Feb. 27, 2012 @ 6:14 p.m.

I agree 100%, Visduh. But as you probably know I have done a couple of columns and several blog items on suspicious activities at UCAN. There are several whistleblowers inside the organization who question much of what is going on. One of them may have gone to the FBI and/or US Attorney and this investigation resulted. Best, Don Bauder

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Don Bauder Feb. 28, 2012 @ 9:48 a.m.

PROBABLY NOT RED ROCK ENERGY PARTNERS. In the above post I stated that the U.S. Attorney may be looking at UCAN investments in Red Rock Energy Partners. I believe that may be wrong. I think the investments were in Red Rock Capital Fund. One Matt Davio was a managing partner of this fund. Davio and Peter Navarro worked closely together, making weekly stock market analyses in the 2005-2006 period. Navarro also did work for UCAN and he and Shames have been close friends. There is controversy about how much UCAN put into the fund, and, presumably, lost. I have not been able to determine what happened to the fund. There is still one by that name but I could not reach the person who heads it, and it appears to be a one-person operation. Davio is now employed elsewhere (still in the investment world), but he did not respond to a phone call or an email. Best, Don Bauder

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