One mailer tries to tie candidate Magdalena Carrasco to gangs, traffic, smog and Los Angeles politicians.
The flyer violates election law because it comes from a committee that does not exist.
Just last weekend, voters received another mailer showing Carrasco's picture next to the Vietnamese Communist flag.
That flag is considered offensive to many Vietnamese-Americans, who make up about 10 percent of the district.
The San Jose Chamber of Commerce is offering a $5,000 reward for information leading to the people behind them.
"What they've done is a form of identity theft, mail fraud, impersonating a candidate; it's illegal, it's over the line, it's not just unethical, it's against the law," Mayor Chuck Reed said.
The District Attorney's office and state elections officials are investigating the case.