Ex-Congressman Jailed After Being Found Guilty on 23 Counts

FILE – In this Jan. 3, 2013, file photo, Rep. Steve Stockman, R-Texas, right, participates in a mock swearing-in ceremony in Washington. A federal jury has convicted the former Texas congressman of fraud and conspiracy for misusing charitable donations to pay for personal and political expenses. (AP Photo/Evan Vucci, File)

HOUSTON (CN) – A federal jury convicted former Texas Congressman Steve Stockman on 23 out of 24 criminal counts in his corruption trial on Thursday, and he was immediately taken into custody amid fears he is a flight risk.

Stockman, 61, rested his head on his fist and sat stoically at the defense table as U.S. District Judge Lee Rosenthal read the verdict at the Houston federal courthouse Thursday afternoon.

The verdict came after a four-week trial in which prosecutors pulled from their trove of 142,000 pages of discovery, and painstakingly presented their case with numerous bank records, emails, text messages and check stubs.

They called to the stand two of Stockman’s congressional staffers, who corroborated the paper trail backing the government’s claims that Stockman defrauded two Republican businessmen of $1.2 million in charitable donations.

Federal agents arrested Stockman on March 15, 2017, while he was boarding a plane at Bush Intercontinental Airport in Houston on his way to the United Arab Emirates, the culmination of an FBI investigation that started in 2014 after news reports surfaced that Stockman’s 2012 campaign for Congress had received $15,000 in illegal donations.

Stockman was released on a $25,000 unsecured bond shortly after his arrest, and remained free until Thursday.

The Republican represented southeast Texas districts in the U.S. House of Representatives from 1995 to 1997 and 2013 to 2015.

A federal grand jury returned a superseding indictment in March 2017, charging Stockman with 24 counts, including mail and wire fraud, money laundering and making false statements to the Federal Election Commission.

After the jury convicted Stockman on each count except one wire fraud charge, federal prosecutor Robert Heberle requested that his bond be revoked.

“Stockman is facing a long sentence. That was not true before today,” Heberle said. “He has extensive foreign contacts in a number of places where it may be hard to find him. He has dealings in cyrptocurrency and we don’t know the state of his finances. And he sent [longtime staffer] Jason Posey to Egypt for two years to thwart the FBI’s investigation.”

Stockman’s defense attorney Sean Buckley lobbied for him to stay free on bond until his sentencing hearing.

“He’s been on bond since his arrest and made all his court appearances,” Buckley said.

But Judge Rosenthal disagreed.

“I don’t share your confidence, Mr. Buckley … The trial testimony made clear the deep nature of Stockman’s international contacts, including people who may assist him. I share the government’s concerns about the difficulty in detecting him in and extraditing him from these countries,” she said.

The government charged Stockman, an accountant, with using several shell bank accounts of bogus nonprofit charities formed in his name to launder $1.2 million donated by two prolific donors to Republican political causes: Richard Uihlein, a Chicago businessman, and Stanford Rothschild, a Baltimore investment manager who died last year at age 91.

They said Stockman got Uihlein to donate $350,000 in January 2013 with a slick pitch in which the lawmaker said the funds would go towards the purchase and renovation of Washington townhouse that would be used as a dorm and meeting place for young conservatives.

Stockman made a run for the seat of U.S. Senator John Cornyn, R-Texas, but placed second behind Cornyn in the March 2014 Republican primary.

Uihlein donated $450,000 in 2014 to the Center for the American Future, a nonprofit that was supposed to be independent of Stockman’s campaign committee, to fund the printing and distribution of a mailer, made to look like a newspaper, touting Stockman as more conservative than Cornyn.

But prosecutors presented evidence showing Stockman himself had helped his staff solicit Uihlein’s donation, in violation of federal campaign laws that limit such “coordinated expenditure contributions” to a federal candidate or their campaign committee to no more than $25,000 in a calendar year.

Rothschild, meanwhile, donated $450,000 to Stockman’s nonprofits from 2010 to 2012 with instructions for Stockman to spend it on voter education.

But prosecutors said Stockman helped himself to Uihlein’s and Rothschild’s donations.

They called FBI forensic accountant Showlatha Johnson to the stand on March 28.

Johnson testified that she had traced how Stockman moved $150,000 of Rothschild’s donations through seven bank accounts before spending it on trips to Disneyland, credit card debts, purchases at electronics stores and Walmart, airline tickets, dental, medical and power bills, charges at a tattoo parlor in Venice, Calif., and several purchases from SkyMall.

Stockman, who seemed handpicked by central casting as a freewheeling Texan during his time in Congress, was 37 when he upset longtime incumbent Democrat Jack Brooks in the November 1994 election for Texas’ Ninth Congressional District.

True to his reputation as a Tea Party-backed contrarian, Stockman made headlines in January 2014 when he walked out of former President Barack Obama’s State of the Union address.

His defense team tried to portray him as an absent-minded, disorganized, but kind-hearted man who solicited Uihlein and Rothschild with honest intentions but did not follow through with his plans to spend their donations like he said he would.

His defense attorneys also tried to cast blame on Uihlein and Rothschild, claiming it was clear from the emails they exchanged with Stockman and his staff they knew their donations were going to directly fund Stockman’s campaigns.

Thursday’s guilty verdict did not visibly upset Stockman. He stood up and faced a U.S. marshal who moved in close to the defense table to handcuff him.

Asked if Stockman, who was not available to talk to reporters, said anything to him after the verdict, his attorney said Stockman kept his head up and did not complain at all.

“He’s a survivor and he’s been a survivor all his life. He was homeless back in the 1980s at one point. For six months he lived in a city park in Fort Worth. So yeah he’s a survivor, but it’s really an unfortunate situation,” Buckley said.

Buckley said he is planning to appeal after Stockman is sentenced. He said Stockman could be sentenced to anywhere from five years to life behind bars, but he expects the former lawmaker will be sent to a minimum-security prison.

“This is not a situation where he’s accused of any violence or hurting anyone so there’s no reason why they would put him in a restrictive environment. It’s not a country club. A lot of people have that misconception about federal prison. It’s not that at all. But he will not be in an environment where he will be physically threatened,” Buckley said.

The prosecutors who tried Stockman’s case and Houston U.S. Attorney Ryan Patrick declined to comment on the verdict.

Thomas Dodd and Jason Posey, Stockman’s former staffers who testified against him, are set for sentencing on Sept. 5.

Dodd pleaded guilty to mail and wire fraud and lying to the Federal Election Commission in March 2017. Posey pleaded guilty last October to mail and wire fraud and money laundering.

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