Former Fattah Aide Pleads Guilty to Misusing Campaign Funds

PHILADELPHIA, PA - APRIL 04: U.S. Congressman Chaka Fattah attends the Launch of Virgin America's First Flight from Los Angeles to Philadelphia on the tarmac of Phildelphia International Airport on April 4, 2012 in Philadelphia, Pennsylvania. (Photo by Michael Buckner/Getty Images)
National Journal
Billy House
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Billy House
Aug. 27, 2014, 11:44 a.m.

A polit­ic­al con­sult­ant and former aide to Demo­crat­ic Rep. Chaka Fat­tah pleaded guilty on Wed­nes­day to fed­er­al charges tied to two schemes in­volving the mis­use of fed­er­al and loc­al cam­paign funds ini­ti­ated by “a long-time friend and former em­ploy­er.”

In an­noun­cing the plea ob­tained from Gregory Naylor, 66, the Justice De­part­ment iden­ti­fied that friend only as “Elec­ted Of­fi­cial A.”

But some of the wrong­do­ing that Naylor has pleaded guilty to””as de­scribed Wed­nes­day in a state­ment by pro­sec­utors””oc­curred at a time when he was an ad­viser to Fat­tah’s 2007 may­or­al bid in Phil­adelphia. Ad­di­tion­ally, some of the mis­used funds are de­scribed as com­ing from not only a “loc­al cam­paign fund,” but also the of­fi­cial’s “fed­er­al cam­paign elec­tion com­mit­tee.”

There was no im­me­di­ate com­ment from Fat­tah’s of­fice in Wash­ing­ton. The 10-term Demo­crat­ic con­gress­man is a mem­ber of the House Ap­pro­pri­ations Com­mit­tee.

Fat­tah him­self ac­know­ledged in a let­ter in March to Speak­er John Boehner that he had been sub­poenaed for doc­u­ments. And Fat­tah’s law­yer told The Phil­adelphia In­quirer last year that fed­er­al in­vest­ig­at­ors have been prob­ing his fin­ances for years.

The word of Naylor’s pleas come after the con­gress­man’s son, Chaka Fat­tah Jr., was charged in April with fraud and fil­ing false tax re­turns.

The first scheme to which Naylor has pleaded guilty is de­scribed in the an­nounce­ment Wed­nes­day as in­volving the theft of fed­er­al grant funds and private char­it­able funds to re­pay an il­leg­al cam­paign debt in­curred by the un­named of­fi­cial “dur­ing a 2007 cam­paign for elec­ted of­fice.”

The second scheme, ac­cord­ing to the Justice De­part­ment an­nounce­ment, in­volved us­ing fed­er­al and loc­al cam­paign funds “to pay down por­tions of the col­lege debt of Elec­ted Of­fi­cial A’s son.”

“Some of the pay­ments ori­gin­ated dir­ectly from the loc­al cam­paign fund, and some were il­leg­ally sourced from Elec­ted Of­fi­cial A’s fed­er­al cam­paign elec­tion com­mit­tee and pass through the loc­al cam­paign fund ac­count to Naylor,” the an­nounce­ment says.

That state­ment goes on to spe­cify that Naylor made about $22,000 in im­prop­er pay­ments between Au­gust 2007 and April 2011 “at Elec­ted Of­fi­cial A’s re­quest.”

Naylor also falsely claimed on IRS forms that the pay­ments to­ward the col­lege debt were earned in­come to Elec­ted Of­fi­cial A’s son for ser­vices rendered as an in­de­pend­ent con­tract­or to Naylor’s con­sult­ing firm, the an­nounce­ment says.

“Spe­cific­ally, Naylor was aware that large amounts of money from an un­ex­plained source were be­ing spent on Elec­ted Of­fi­cial A’s cam­paign, and Naylor helped to con­ceal the source of those funds by pre­par­ing a false in­voice for ser­vices rendered by his con­sult­ing firm.”

Naylor also is de­scribed as hav­ing later learned “that Elec­ted Of­fi­cial A and oth­ers or­ches­trated the theft of fed­er­al grant funds to re­pay the out­stand­ing bal­ance of the cam­paign debt, and he agreed to the falsi­fic­a­tion of cam­paign fin­ance re­ports to fur­ther con­ceal Elec­tion Of­fi­cial A’s activ­it­ies.”

Naylor pleaded guilty in fed­er­al court to mak­ing false state­ments to fed­er­al agents and “mis­pri­sion of a felony” in con­nec­tion with his at­tempts to con­ceal the two cam­paign-fin­ance-re­lated fraud­u­lent schemes. Sen­ten­cing has been set for Dec. 2.

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