Ex-San Francisco 49ers exec charged in alleged $1.4M taxpayer kickback scheme

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A former San Francisco 49ers executive and his friend allegedly turned taxpayer-funded construction projects into a $1.4 million kickback scheme — until unpaid businesses started asking questions.

San Mateo County District Attorney Steve Wagstaffe told The California Post that a grand jury was “incensed” as they reviewed the evidence over two weeks, calling the alleged scheme an “extraordinarily serious” example of white-collar crime.

Former 49ers exec James Cunningham Mercurio, 55, of Vacaville, is facing numerous criminal charges.

Mercurio, who worked nearly 30 years for the 49ers in stadium operations and rose to become an executive vice president and general manager for the club, allegedly steered contracts to McLennan, who returned portions of the payments to his longtime friend rather than using all the money for construction, according to prosecutors.

The county Event Center hired Mercurio in 2024 to oversee three construction projects, each supported by $1 million in county tax dollars. Alleged kickbacks to Mercurio totaled about $1.4 million, prosecutors said.

“We’re only talking about a year and a half and $1.4 million, but for San Mateo County that’s big,” Wagstaffe said. 

“Maybe for the federal government looking into corruption in L.A. or something, that’s petty ante. But for us, it’s a very serious offense.”

The indictment last week charged both men with two counts of misappropriating public money, one count of embezzlement and 20 counts each of commercial bribery. McLennan also faces a felony forgery charge involving an allegedly fabricated performance bond.

Prosecutors included aggravated white-collar crime allegations involving a pattern of related felonies and the taking of more than $500,000.

Both men pleaded not guilty at their Oct. 8 arraignment, and court records show Mercurio posted a $750,000 bond.

The charges against the former NFL exec come just two months after 49ers owner Jed York was arrested in August in an Ohio prostitution sting. York pleaded no contest to misdemeanor disorderly conduct and possessing criminal tools after prosecutors reduced the prostitution charge. He was later suspended by the NFL and fined $500,000.

The investigation into the San Mateo County scheme started after McLennan fell behind on payments to subcontractors, Wagstaffe said. One subcontractor asked to inspect the performance bond, prompting county attorneys to examine the document.

One big problem — the bond was fake, according to authorities.

Corruption investigators then worked to document the alleged payments and transactions before prosecutors presented evidence to a grand jury.

Wagstaffe said the case required painstaking legwork rather than untangling a sophisticated operation with numerous participants.

His “dogged” investigator, he said, typically “peels that onion right down to the core.”

“He didn’t have too many peels to take off on this one,” Wagstaffe said.

Mercurio’s attorney, Brian Getz, did not respond to The Post’s requests for comment but defended his client in comments to Bay City News, pointing to his decades with the football team and community ties.

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“James Mercurio has a solid record of community service and was a successful executive with the San Francisco 49ers for 30 years,” Getz said.

“I have every confidence in James Mercurio as a person and as a litigant.”

Michael Guingona, an attorney for McLennan, declined comment Tuesday, telling The Post he has not received discovery and is still working to get his client released from custody.

Wagstaffe said the allegations underscore the danger of relying on personal relationships or professional reputations without checking how money is being handled.

“There’s got to be a check and balance. There’s got to be oversight,” he said.

The DA cited another case involving Clarise Blanchard, 79, who was named San Mateo County’s 2008 Woman of the Year. She was sentenced in August to six months in jail for embezzling more than $813,000 from the mental health nonprofit StarVista, according to Bay City News.

The lesson, Wagstaffe said, is that the government must “trust but verify” whenever taxpayer money is being used.

“You have to have people who are double-checking people’s words,” he said.

“I remember my father saying that he thought the world of law and business went down the drain when you couldn’t rely on a handshake anymore. And the answer is, it’s certainly true. You can’t do that. You’d be a fool to do that anymore.”