Feb. 22, 2008 -- A federal grand jury in Arizona has indicted three-term Republican Congressman Rick Renzi and two of his business associates on charges that include wire fraud, money laundering, insurance fraud and extortion.
The 35-count indictment alleges that between December 2001 and March 2002, Renzi embezzled $400,000 in insurance premiums from a company that he owned and transferred the money to his congressional campaign.
Renzi transferred ownership of the company, called Patriot Insurance Agency Inc., to his wife in 2004.
The lawmaker is also accused of enriching himself by compelling a copper mining interest, referred to as "Company A" in the indictment, to buy a parcel of land from his associate James Sandlin in exchange for his sponsorship of legislation sought by Company A.
When negotiations for the sale were stalled, Renzi allegedly told Company A "no Sandlin Property, no bill."
Sandlin owed Renzi $700,000 for property and paid $733,000 to Renzi when the sale went through, the indictment alleges. Prosecutors say Renzi failed to disclose the debt and the payment, something that he as a member of Congress is required to do by law.
Sandlin, of Sherman, Texas, was also indicted for his alleged role in the property deal. Another Renzi business associate, Andrew Beardall of Rockville, Md., faces charges stemming from the alleged embezzlement of the $400,000 from Patriot Insurance Agency.
A statement released by Renzi's attorneys Reid Weingarten and Kelly Kramer was critical of the timing of the charges.
On Thursday, Renzi buried his father, Maj. Gen. Eugene Renzi, at Arlington National Cemetery.
"We are disappointed that the Department of Justice would not allow a decent amount of time to pass to allow a son to mourn the passing of his father," the statement said. It also stated that Renzi did nothing wrong and will fight the charges. He and his codefendants are scheduled to appear in federal court in Arizona on March 6.
Renzi's attorneys also suggested that the prosecution may have been politically motivated. "We fear that the Department of Justice may have allowed the investigation to have been influenced by political considerations, which should never have a place in the administration of justice."
News reports of the federal investigation into Renzi last year coincided with the firing of Paul Charlton, the U.S. attorney from Arizona.
Renzi's chief of staff called Charlton's chief spokesman after word of a possible indictment of Renzi was leaked to the press in October 2006 — just before the midterm election. Charlton's office reported the call to the Justice Department shortly before he was fired.
Renzi stepped down from his seats on House committees in April 2007 after the FBI raided his wife's insurance business, and he has said he will not seek re-election.
But House Majority Leader John Boehner, R-Ohio, urged Renzi to consider an earlier exit from office.
"The charges contained in this indictment are completely unacceptable for a Member of Congress, and I strongly urge Rep. Renzi to seriously consider whether he can continue to effectively represent his constituents under these circumstances," a statement from Boehner's office, released Friday afternoon, said. "I expect to meet with Rep. Renzi at the earliest possible opportunity to discuss this situation and the best option for his constituents, our Conference, and the American people."
Renzi, a father of 12, was a real estate developer in Arizona before being elected to Congress in 2002. He holds a degree in criminal justice and a law degree.