Renzi, Rick

Rick Renzi, Republican Congressman, Indicted by U.S.

Feb. 22 (Bloomberg) -- Representative Rick Renzi, a Republican from Arizona who isn't seeking re-election, has been indicted by a federal grand jury in an alleged scheme to profit from a land deal.

Renzi, 49, who was first elected to the House in 2002, was charged along with James Sandlin, 56, a real estate investor and one of his political backers, and Andrew Beardall, 36, an attorney who had been general counsel of Renzi's family insurance business. Renzi and Beardall are accused of embezzling money from insurance clients to fund the lawmaker's congressional campaign.

``Congressman Renzi misused his public office by forcing a land sale that would financially benefit himself and a business associate, and in so doing, he betrayed the trust of the citizens of Arizona,'' said U.S. Attorney Diane Humetewa of Phoenix in a statement.

The Justice Department has been cracking down on public corruption, a campaign that has targeted lawmakers. Democratic Representative William Jefferson of Louisiana has pleaded innocent to bribery charges, and, in 2007, ex-Ohio Republican Representative Bob Ney was sentenced to 2½ years in prison after pleading guilty to conspiracy and making false statements in connection with disgraced lobbyist Jack Abramoff.

Renzi's Washington lawyers, Reid Weingarten and Kelly Kramer, issued a statement saying Renzi did ``nothing wrong'' and criticizing the Justice Department for bringing its case shortly after his father's death. ``We will fight these charges until he is vindicated and his family's name is restored,'' they said.

`Feel for the Family'

Senator John McCain, an Arizona Republican and the party's presumed presidential nominee, told reporters today when asked about the indictment that ``you always feel for the family.'' McCain, speaking after a rally in Indianapolis, said he didn't know enough details to make a judgment on the case.

The U.S. alleged that Renzi offered to sponsor legislation to help a company seeking to swap land with the federal government if it purchased property owned by Sandlin. Renzi, who sat on a committee that approved such deals, told the company in early 2005 that he wouldn't support the request if it didn't buy the land, according to the indictment. No deal was made.
Later, Renzi pressured a separate investment group, also looking for approval of a land exchange, to purchase the property, prosecutors said. That group agreed to buy 480 acres from Sandlin for $4.6 million in April 2005, the government said.

Renzi, according to the indictment, told the investment group it would have a ``free pass'' through his panel, the Natural Resources Committee.

Financial Difficulties

While the land negotiations were under way, according to court papers, Sandlin owed Renzi $700,000. Renzi was having financial difficulties as well, the government said.
Renzi also failed to publicly disclose Sandlin's debt and its repayment after the land sale, according to the indictment.

The lawmaker and attorney Beardall were charged with conspiring to steal more than $400,000 from Renzi's insurance business from December 2001 through June 2003. The money was used to fund Renzi's campaign for Congress, according to court papers.
The 35-count indictment, issued in Arizona, includes charges of conspiracy, money laundering, insurance fraud and wire fraud. The arraignment will be on March 6 in U.S. District Court in Tucson, the Justice Department said.

The Renzi investigation was highlighted during a congressional inquiry last year into the Bush administration's firings of nine U.S. attorneys. One of the dismissed prosecutors, Paul Charlton, had been in charge of the probe.

Democrats said the firings may have been carried out to slow public corruption cases against Republicans. Though that was never proved, the scandal drove Attorney General Alberto Gonzales from office in September.

To contact the reporter on this story: Robert Schmidt in Washington at rschmidt5@bloomberg.net

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