LOS BANOS, CA (August 18th, 2025) — District 1 City Council candidate Kalid Virriy Sanchez is under new scrutiny after comments she made to a local newspaper about her financial obligations, coupled with a recently filed lawsuit against her in Merced County Superior Court. With the city still recovering from past council decisions that cost taxpayers millions, voters are weighing whether her record reflects the preparedness needed for public office.
Candidate’s Statements
In an August 14 article in the West Side Express, Sanchez acknowledged difficulties keeping her boutique business afloat. “My electricity was over $2,000 for one month,” she said. “So, there was no way to keep up my business. I fell behind on rent.”
She told the paper that although she had signed a seven-year lease, she sublet the space to a support group when she could no longer afford the location. “I have to make up the money from them and [the landlord] added that to my lease,” Sanchez explained.
Asked why those obligations were not disclosed on her legally required Form 700 (Statement of Economic Interests), Sanchez replied: “I didn’t report that on the 700 Form because it’s not money that I received. I didn’t take out a loan. I never got money from them.”
Sanchez also addressed the impact of public scrutiny. “If I do become a city councilmember, I don’t want a lot of people going to my house – for the safety of my kids,” said Sanchez, a mother of five. “With all the lies and a private investigator writing about me … I don’t feel safe.”
Trust Deeds with Developer
Public records from the Merced County Recorder’s Office show that Sanchez and her husband executed two deeds of trust in favor of Sacramento developer Ethan Conrad:
- $19,189 dated July 18, 2023, due March 31, 2027
- $36,000 dated September 13, 2024, due March 31, 2030
A deed of trust is a secured lending instrument enforceable by foreclosure under California Civil Code §§ 2920–2924. Under the Political Reform Act, candidates must disclose any financial liability of $500 or more, including loans from private parties secured by real property. Gov. Code § 87207(b)(2) requires disclosure of “any outstanding loan” and “any creditor to whom $500 or more is owed,” and the FPPC’s own Form 700 instructions specify that “loans from a private lender that total $500 or more and are secured by real property may be reportable.”
A Trustee of the U.S. Bankruptcy Court for the Eastern District of California, who reviewed the documents, said he had never seen a commercial arrangement structured in this way and described the deeds of trust as “extraordinary,” noting that their unusual form could even create complications in bankruptcy. A retired investigator from the Riverside County Political Corruption Bureau, with decades of experience reviewing public officials’ disclosures, also said the omission of these obligations raises serious compliance concerns under California law.
Sanchez has not responded to questions from the Enterprise seeking comment on whether she consulted with any compliance experts regarding the disclosure of these obligations.
Lawsuit in Merced County
In addition to the undisclosed trust deeds, Sanchez is now facing litigation in Merced County Superior Court. Case number 25CV-02596, Midland Credit Management, Inc. v. Kalid V. Sanchez, was filed earlier this year for breach of contract. The complaint alleges that Sanchez defaulted on a financial obligation.
Court records indicate that Sanchez was served but has not filed an answer within the required period. Legal observers note that this makes it likely Midland will obtain a default judgment, which could permit the creditor to place another lien on her home. The case is not related to her dealings with Ethan Conrad but adds another unresolved financial matter to her record. Sanchez was not asked for comment regarding the Midland lawsuit, as she has made it clear she will not speak with the Enterprise.
Concerns About Financial Disclosure
Sanchez has emphasized her experience as a business owner and financial analyst as part of her campaign platform. A review of FPPC statutes, instructions, and advice letters, along with input from compliance experts, indicates her explanations reflect a misunderstanding of disclosure requirements.
The FPPC has consistently held that the key to disclosure is whether there is a legally enforceable obligation. The Commission has stated in advice letters that debts secured by real property, as well as enforceable credit arrangements such as lines of credit, are “loans” for disclosure purposes. By that measure, the deeds of trust executed by Sanchez and her husband qualify as reportable loans.
Similarly, her decision not to file an answer in the Midland lawsuit has raised concerns. Failing to respond almost guarantees a default judgment, a small procedural step that can snowball into larger legal and financial consequences. Ignoring such obligations has long-term implications, and observers say it is the kind of oversight that becomes far more consequential when entrusted with public office.
Potential Slander Concerns
In her comments to the West Side Express, Sanchez referred to “all the lies and a private investigator writing about me.” The reference to a private investigator appears to conflate two separate roles. The Enterprise is a news outlet engaged in investigative reporting; while its CEO also leads a private investigation firm, the two entities are distinct. The Enterprise did not hire or utilize the services of a private investigator in its coverage of Sanchez. All research was conducted under the standards of investigative journalism.
Accusing a newspaper of “lies” raises potential questions of slander. While candidates are free to disagree with coverage, labeling fact-based reporting as dishonest is an assertion of fact, not opinion, and could expose a candidate to liability. Los Banos has already come close to litigation over public officials’ remarks: Councilmember Brett Jones previously made statements on Facebook that nearly resulted in a defamation lawsuit against the city, even though he was not speaking in his official capacity. Critics warn that electing candidates who speak carelessly could put the city at similar risk.
A City Still Recovering
Los Banos voters are particularly sensitive to issues of financial competence. In recent years, the city council rehired former City Manager Josh Pinheiro under terms that led to a $1.8 million payout, sparking lawsuits, a recall election, and widespread criticism of the council’s judgment. While those decisions were not attributed to corruption, they were seen as the product of inexperience and a failure to evaluate risks.
Some residents worry that electing a candidate who does not fully grasp disclosure requirements, fails to respond to litigation, or makes potentially defamatory public statements could set the city up for similar mistakes.
What Voters Will Weigh
For District 1 voters, the decision on August 26 may come down to whether Sanchez’s background and recent legal issues reflect readiness for office.
The record shows that:
- She and her husband signed two trust deeds with a developer that were not reported on required FPPC forms.
- She is being sued in Merced County for breach of contract, has not filed an answer, and risks a default judgment that could result in another lien.
- She has publicly described her obligations in terms that differ from how state law and FPPC rules define indebtedness.
- She has accused the Enterprise of “lies,” raising potential slander concerns.
Sanchez has said she feels unfairly targeted and has emphasized her commitment to her family’s safety. Voters will now decide whether those explanations, paired with her legal and financial record, demonstrate the preparedness needed for a seat on the Los Banos City Council.
