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 Fattah, 58, who has represented Philadelphia in the U.S. House of
Representatives for two decades and is one of the senior black
lawmakers in Congress, and the others were indicted by a federal
grand jury on 29 counts in an alleged racketeering conspiracy, the
U.S. Department of Justice said.
Fattah said in a statement that "I have never participated in any
illegal activity or misappropriation of taxpayer dollars as an
elected official." He said he would not resign from the House but he
did step down as the top Democrat on the House subcommittee
overseeing Justice Department spending.
"This will not be a distraction from my service to the people that
elected me, and I am confident that I will be cleared of these
charges," Fattah added.
The charges included bribery, mail fraud, falsification of records,
bank fraud, money laundering, making false statements to a financial
institution and other crimes.
Fattah denounced a "misguided" eight-year Justice Department
campaign "to link my public service career to some form of
wrongdoing."
The others indicted were: lobbyist Herbert Vederman, 69, of Palm
Beach, Florida; Fattah’s congressional district director, Bonnie
Bowser, 59, of Philadelphia; Robert Brand, 69, of Philadelphia; and
Karen Nicholas, 57, of Williamstown, New Jersey.
The indictment said that in Fattah's failed 2007 campaign for mayor
of Philadelphia, the congressman and certain associates borrowed $1
million from a wealthy supporter and disguised the funds as a loan
to a consulting company.
The Justice Department said after losing the election, Fattah
returned $400,000 to the donor and arranged for a non-profit entity
he founded to repay the remaining $600,000 using charitable and
federal grant funds that passed through two other companies.
To conceal the contribution and repayment scheme, the defendants and
others created sham contracts and made false entries in accounting
records, tax returns and campaign finance disclosure statements, the
department said.
The indictment said Fattah, after his mayoral defeat, sought to
erase about $130,000 in campaign debt owed to a political consultant
by agreeing to arrange for the consultant to get federal grant
funds.
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SON'S COLLEGE LOANS
Fattah also was accused of misappropriating funds from mayoral and
congressional campaigns to repay $23,000 toward his son's college
loan debt. Chaka Fattah Jr. was charged in 2014 with fraud related
to loans associated with a business he ran, and is awaiting trial.
The indictment accused the congressman of contacting government
officials to try to get Vederman an ambassadorship or a U.S. Trade
Commission appointment. The indictment accused the defendants of
trying to conceal an $18,000 bribe from Vederman to Fattah by
disguising it as a payment for a car sale that never occurred.
"I can tell you that the conduct that Congressman Fattah engaged in
undermines public faith in government, undermines confidence in
government," Zane David Memeger, U.S. attorney for the eastern
district of Pennsylvania, told a Philadelphia news conference.
House Democratic Leader Nancy Pelosi called the charges "deeply
saddening," saying Fattah had a record of "distinguished service."
Thomas Lindenfeld, a political consultant who advised Fattah,
pleaded guilty last year to participating in a plan to provide
illegal campaign contributions. Gregory Naylor, another aide, also
pleaded guilty last year over campaign finance schemes.
A liberal first elected to the House in 1994, Fattah is a member of
the Congressional Black Caucus and heads the Congressional Urban
Caucus, a bipartisan group of members from U.S. metropolitan
centers.
(Reporting by Will Dunham and Emily Stephenson; editing by Bill
Trott and Grant McCool)
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