Feds Investigating Christie's Use of Sandy Relief Funds

Jan. 13, 2014— -- New Jersey Gov. Chris Christie, viewed by many as a hero of Superstorm Sandy, is now facing a federal investigation into his use of millions in money his administration received as part of a massive recovery package, ABC News has learned.

Rep. Frank Pallone, D-N.J., said this morning he was notified "at the end of last week" that a preliminary review by the inspector general of the Housing and Urban Development Department has now become "a full-blown investigation."

"There's reason to believe there's a problem here," Pallone said.

Subpoenas Expected for Chris Christie Aides Over Bridge Scandal

At issue is $25 million used for the controversial "Stronger than the Storm" advertising campaign, which starred Christie and his family right as the governor was running for a second term. Christie was careening toward a landslide victory on his way to an expected run for the Republican presidential nomination in 2016.

"While promoting tourism at the Jersey Shore in the wake of Hurricane Sandy is certainly a worthy endeavor, recent reports have led me to believe that the state has irresponsibly misappropriated funding allocated by Congress from the Sandy aid package and taken advantage of this waiver for political purposes," Pallone, who represents much of the northern Shore region, wrote in requesting the probe last August. "I respectfully request that you review and investigate the contract, bidding process utilized by the State of New Jersey, and appropriateness of the content of this marketing campaign."

In headline-grabbing fashion, Christie personally led the state's response to the 2012 hurricane that slammed into New Jersey and New York. He was criticized for embracing Democratic President Barack Obama as Obama was seeking his own second term and then declined to do any campaigning for Republican nominee Mitt Romney as that year's presidential campaign climaxed.

Christie's aides sloughed off criticism of the federally funded commercials that put the Christies on a sun-drenched beach in heavy TV rotation.

"It's pretty hard to argue that (the Christies) are in a uniquely qualified position to tell a very wide audience beyond New Jersey that our state and our Shore are open for business," Christie spokesman Michael Drewniak said at the time.

Drewniak and other officials in Christie's office did not reply to questions about the federal probe this morning.

READ MORE: FULL COVERAGE OF CHRISTIE AND THE BRIDGE SCANDAL

News of the investigation comes as the governor is facing the toughest episode of his political career. Last week, after the release of emails between his staff members amid a legislative probe, Christie said he was embarrassed and humiliated by two key aides who plotted to cause an epic four-day traffic jam at the George Washington Bridge as payback to the Democratic mayor of Fort Lee, where the bridge touches New Jersey.

The so-called "Bridge-Gate" scandal has already threatened Christie's political future. The usually bombastic governor appeared chastened in speaking with the press last Thursday and has not had a single public appearance in four days. He is due to deliver his annual State of the State address tomorrow but the event is certain to be far from the normal celebration it usually is.

The bridge scandal is being investigated now by federal prosecutors in New Jersey as well as the independent inspector general of the agency that operates the span.

The federal probe into Sandy spending comes after a chorus of criticism by both Democrats and Christie's fellow Republicans.

Sen. Rand Paul, R-Ky., during questions to HUD Secretary Shaun Donovan last year, said: "In New Jersey, $25 million was spent on ads that included somebody running for political office. You think there might be a conflict of interest there?"

Said Paul, another contender for the '16 GOP presidential nod, "People running for office put their mug all over these ads while they're in the middle of a political campaign...It gives a little bit of a black eye to something."

ABC News' Andrew Evans contributed to this report.