The dispute over Arcadia Councilwoman Sharon Kwan’s unpaid board seat at a Texas oil company centers on what the available evidence establishes about its ownership and her role. At Tuesday’s meeting, council members questioned Kwan about the position, but took no formal action. The discussion came weeks before she faces voters in District 2 and as the city continues to deal with the fallout from former Mayor Eileen Wang’s guilty plea in a case involving work on behalf of China.
Kwan told colleagues she receives nothing from the company, no shares, payroll or consulting fees, and that she covers her own travel costs tied to the role. “I receive nothing. Zero. Not even a penny,” she said, according to heysocal.com. She described the firm as 50% owned by Chinese investors and 50% by American investors, and argued there was no conflict of interest because, in her words, the firm does not do business in Arcadia.
Shandong Xinchao Energy Corp. explores, develops and sells oil and natural gas, with assets that include low-sulfur light crude oil and associated natural gas, the Los Angeles Daily News reported. The company operates in Texas’ Permian Basin and employs roughly 300 American workers, according to the paper. Kwan said former real estate investment partners nominated her to the board and described her duties as monitoring shareholder profits and making business recommendations.
Fu and Han Push Back on the Ownership Story
Mayor Pro Tem David Fu questioned whether Kwan had submitted documents to support her account, according to heysocal.com’s report of the meeting. He said lawyers’ statements conflicted with her description of partial U.S. ownership and that court filings indicated the company was fully owned by Chinese entities. Fu also challenged the evidence Kwan offered about ethical foreign relationships and her experience in the oil and energy sector, the Daily News reported.
Councilman John Han, appointed in June to replace Wang and now running for reelection in District 3, presented an ownership chain that he said showed Yutai, based in Inner Mongolia, owns 50.1% of Beijing-based Xingtao Energy. Han argued that Chinese company law connects such firms to the Chinese Communist Party and a national security framework. Fu also cited Chinese law in arguing that people in roles at these companies have duties to the party, according to the Daily News.
Kwan rejected suggestions that she has political loyalties to China. “I have no ties to the Chinese Communist Party or any foreign government,” she said in a statement reported by heysocal.com. The Daily News reported that she cited her son’s work as a consultant for the U.S. Defense Department and his CIA security clearance as evidence, in her view, that her foreign relationships were proper. Kwan also said the lawsuit raised in the dispute concerned a transaction in which a Chinese entity exclusively purchased the Chinese-owned portion of the company. She said she had not disclosed the relationship earlier because she understood required economic-interest filings to cover only financial interests within Arcadia. She has argued that the company’s net worth dwarfs Arcadia’s annual budget, which is less than one percent of it, and that her board seat poses no threat to the city.
A City Still Reeling From a Mayor's Guilty Plea
Wang resigned as mayor less than a year and a half ago and later pleaded guilty to acting as an illegal agent of the Chinese government, a felony the U.S. Department of Justice says carries a maximum penalty of 10 years in prison. Wang, elected to the council in November 2022, admitted to secretly and illegally promoting China’s interests before her election, according to the New York Times. The Daily News reported that her federal sentencing was postponed from October 6 to January 12. Wang’s former fiancé and campaign manager, Mike Sun, is serving a four-year sentence after pleading guilty to the same charge.
Arcadia said a review of Wang’s communications found no evidence that city systems, equipment or resources facilitated the conduct described in the federal case, the Daily News reported. The city has begun developing protocols intended to guard against foreign influence, including greater scrutiny of ceremonial requests from foreign organizations or governments and training for officials to recognize influence efforts, the Los Angeles Times reported. The newspaper also reported that federal investigations into public corruption and foreign influence have expanded across Southern California since Wang’s plea.
What the Record Establishes
The Justice Department said Wang’s plea agreement described her and Mike Sun working at the direction and control of PRC officials from late 2020 through 2022 to promote PRC interests in the United States. That federal case concerns Wang and Sun; it does not establish anything about Kwan, according to the Justice Department.
That broader pattern has touched other San Gabriel Valley figures. FBI agents served search warrants in July 2026 at the West Covina home and business of James Su, founder and president of EDI Media Inc., which describes itself as the largest Chinese-American multimedia company in the United States. Su, an American citizen who donated to Wang's 2022 council campaign, was not charged with any crime, according to the Southern California News Group. A separate FBI operation also included warrant searches at the homes and offices of Inland Empire officials, including Curt Hagman, Alan Wapner and Frank Lizarraga, per the Daily News.
Kwan's Own History With the Council
Kwan's standing with her colleagues has been contentious before. The Daily News reported that the council censured her in 2025, though it allowed her to retain her duties and powers as mayor pending a further vote. Kwan has said she proposed a council discussion about whether Wang should step down, only to have her colleagues vote it down, and that she twice proposed an independent review of all council members' financial and foreign ties, both of which she said were blocked.
Kwan, a UC Riverside graduate with four children, served 10 years as president of the Rancho Santa Anita Property Owners Association and has sat on the boards of the USC Arcadia Foundation and the Downtown Arcadia Improvement Association. She has said her board membership at Shandong Xinchao Energy is not a concern to Arcadia residents and that she welcomes scrutiny from both the council and the public. “I was fighting for transparency,” she has said, according to the Daily News, framing the questioning as consistent with, not contrary to, her broader push for accountability at City Hall.
Three Council Seats, One Trust Problem
Kwan's District 2 seat is one of three on the November ballot, along with those held by John Han and Michael Cao, the Daily News reported. Burton Brink is challenging Kwan, and has said public trust in the city declined after the FBI raids and federal charges; he has pledged to support an independent forensic audit of city records, emails and money, along with stronger ethics rules, clearer disclosure and regular public reports. In District 3, Han faces challengers Grace Arabella Lee and Cynthia Ng Monje, with Lee cautioning that accountability should not excuse hostility, suspicion or judgment. Steve Rhee, running against Cao in District 5, has said he wants policies that would prevent a foreign-government agent from being elected and becoming mayor again.
Not everyone in Arcadia sees a need for sweeping new rules. Domenico Tallerico, an Arcadia accountant, has said the city had not needed a formal code of conduct before the current group of council members took office, suggesting the current controversy is as much about personalities as policy. For now, the council took no official action following Tuesday's discussion of Kwan's ties to Shandong Xinchao Energy, leaving the questions over her board role, and the broader push for foreign-influence safeguards, unresolved heading into the election.
