The Justice Department stated Tuesday that former Californian Rep. TJ Cox, a Democrat, is facing more than two dozen criminal charges related to what federal prosecutors described as several fraud schemes and campaign contribution fraud.
According to the Justice Department, Cox, who served one term, was charged in a 28-count indictment in federal district court in California with 15 charges of wire fraud, 11 counts of money laundering, one count of financial institution fraud, and one count of campaign contribution fraud.
Cox was chosen to serve in the 21st Congressional District of California in 2018, but he was defeated by Republican David Valadao in 2020. He was detained on Tuesday, according to court documents.
Federal prosecutors said that Cox’s “many” fraud schemes targeted the businesses with which he was associated as well as their customers and suppliers. He is charged with opening secret, illegal bank accounts and transferring money there using “false representations, pretences, and promises.”
According to the Justice Department, Cox gained more than $1.7 million via two distinct fraud schemes that he allegedly carried out between 2013 and 2018 by misappropriating customer money as well as business loans and investments.
Federal prosecutors claim that Cox also reportedly made many false claims to lenders in order to get mortgage loan funding for the purchase of a house, which he falsely claimed would be his main residence and included bogus bank records. However, according to the recently revealed indictment, Cox purchased the home in order to rent it out.
Additionally, it was stated in the indictment that Cox obtained a $1.5 million construction loan unlawfully in order to create Granite Park, a leisure area in Fresno, California. However, Cox falsely claimed that a corporation connected to him would guarantee the loan since his nonprofit organisation and that of a business partner couldn’t qualify for it without a “financially viable party” to do so, claims the Justice Department.
The former congressman reportedly presented a fabricated board resolution as part of the construction loan scam, falsely claiming that at a meeting, the business owners agreed to guarantee the loan to build Granite Park. However, the meeting never happened, the loan went into default, and more than $1.28 million was lost as a consequence, according to federal authorities.
The Justice Department claims that Cox also allegedly carried out a plan to use unlawful straw or conduit payments totaling more than $25,000 from family members and friends to fund his campaign when he was running for Congress in 2018.
If found guilty, Cox could be sentenced to up to 20 years in prison and a $250,000 fine for money laundering and wire fraud, up to 30 years in prison and a $1 million fine for financial institution fraud and wire fraud affecting a financial institution, and up to five years in prison and a $250,000 fine for campaign finance fraud.
As of Tuesday afternoon, Cox’s counsel was not listed in court documents.