Prosecutors Claim Democratic Congressman Steered Federal, Charitable Funds to Illegal Loan

Chaka Fattah
Chaka Fattah / AP

U.S. prosecutors accused Rep. Chaka Fattah (D., Pa.) Monday of routing hundreds of thousands of dollars in federal funds and charity donations to pay back an illegal $1 million loan that went toward his failed mayoral candidacy.

The trial arrived three weeks after Fattah lost his reelection bid in the Philadelphia primary, bringing an end to the congressman’s 20-year service in the House.

Fattah was indicted last year on 29 counts of corruption charges that included participating in a racketeering conspiracy, bribery, and bank fraud.

"The congressman stole from federal agencies, from taxpayers, from nonprofit groups he created to pay his political debts," assistant U.S. Attorney Paul Gray said, according to the Associated Press. "He even stole from his own campaign."

Fattah, a senior member of the Appropriations Committee, allegedly used his position to funnel $600,000 to help refinance his off-the-books loan for his 2007 Philadelphia mayoral campaign. The Associated Press noted that the loan exceeded donor limits in place at the time.

The Philadelphia Democrat was also indicted for using a nonprofit to steer federal grants to Fattah’s family and allies.

Four of Fattah’s associates are also on trial for corruption charges, two of whom pled guilty to the allegations. Fattah’s attorneys said that two campaign consultants who provided testimony acted alone.

"The government's case rests on the word of those two convicted felons," said one of Fattah’s lawyers, Mark Lee.

Fattah received the $1 million loan from his friend and former Sallie Mae CEO Al Lord. Lord demanded a loan repayment after Fattah lost his reelection bid in April, leading the congressman to dip into federal grants for cash.

The trial is predicted to last roughly eight weeks.