One of the lead undercover FBI agents who assembled the political corruption case against state Sen. Leland Yee and others was removed from the investigation for his own financial improprieties, perhaps including his management of the lavish spending on the clandestine four-year probe, according to court papers a key defendant filed Thursday.

The agent, who posed as an Atlanta businessman in the investigation, was being probed for misconduct in late 2012 and early 2013. He appeared to have been removed from the undercover probe at that time, lawyers for indicted San Francisco political consultant Keith Jackson revealed in the court filing.

Jackson's lawyers argue that the agent's misconduct must be fully disclosed because it may be central to efforts to discredit the government's sprawling investigation.

The agent's financial misconduct is unclear, but court papers say he was key to ensnaring Jackson and later Yee in an investigation that began as a probe into reputed Asian organized crime figure Raymond "Shrimp Boy" Chow.

The agent, court papers say, paid Jackson $37,000 in consulting fees over 16 months as part of the undercover operation, arranged $20,000 in donations to an identified political figure, explored setting up a $200,000 fundraiser for a "senior federal elected official" and set up a meeting with a "prominent former professional athlete" to discuss a hotel project. Lawyers in the case say the probe crossed paths with former San Francisco 49ers quarterback Joe Montana, who has backed a proposed hotel and retail project near Levi's Stadium but has never been linked to any wrongdoing.


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Among other legal arguments, Jackson's lawyers say the government failed to disclose that one of its lead agents was being investigated by his bosses when they sought approval from federal judges for wiretaps against Yee, Jackson and other targets. James Brosnahan, Jackson's attorney, has asked U.S. District Judge Charles Breyer to order the government to turn over internal documents detailing why the agent was reprimanded by the FBI.

"(It) is pertinent to understanding why Mr. Jackson was initially targeted, and then pursued for more than three years, even after the FBI removed its lead undercover agent ... for financial misconduct," court papers say.

The U.S. attorney's office declined to comment on the issue.

Yee and dozens of other defendants face racketeering charges, which allege the now-suspended San Francisco Democratic legislator traded his political influence for bribes to help fund his political aspirations. The racketeering indictment characterizes Yee's political campaigns for secretary of state and San Francisco mayor as racketeering enterprises.

With the case now moving through the pretrial stages, defense lawyers have been expected to begin their attack on the government's case, and Jackson's allegations against the FBI investigators are the first salvo. Defense lawyers are also expected to mount efforts to toss out some of the prosecution's evidence, such as wiretaps and video surveillance, as part of claims the investigation amounted to entrapment.

Yee was repeatedly caught in wiretapped conversations discussing his efforts to trade his political power for campaign money, according to the government's court papers.

Howard Mintz covers legal affairs. Contact him at 408-286-0236 or follow him at Twitter.com/hmintz