The Justice Department stated on Tuesday that former California Democrat Representative TJ Cox faces more than two dozen criminal charges arising from what federal prosecutors described as various fraud schemes and campaign contribution fraud.
According to the Justice Department, a federal district court in California unsealed a 28-count indictment against Cox, who served one term, charging him with 15 counts of wire fraud, 11 counts of money laundering, one count of financial institution fraud, and one count of campaign contribution fraud.
In 2018, Cox was elected to represent California’s 21st Congressional District, however in 2020 he lost the seat to Republican David Valadao. He was detained on Tuesday, according to court documents.
Federal prosecutors stated that Cox’s “several” fraud schemes targeted his associated businesses, as well as their customers and suppliers. Through “false claims, pretenses, and promises,” he is accused of establishing unapproved, off-record bank accounts and directing funds into them.
The Justice Department claims that between 2013 and 2018, Cox gained more than $1.7 million via two distinct fraud schemes involving the diversion of client cash, corporate loans, and stolen assets.
Federal prosecutors say that Cox filed several fraudulent representations to a lender in order to obtain mortgage loan money for the purchase of a house, which he falsely claimed would be his main residence and included bogus bank statements. However, according to the recently released indictment, Cox purchased the home for rental purposes.
Additionally, the indictment stated that Cox illegally obtained a $1.5 million construction loan to establish Granite Park, a California leisure area, near Fresno. According to the Justice Department, Cox and a business partner’s charity organization could not qualify for the loan without a “financially viable party” to guarantee the loan, so Cox falsely claimed that a corporation linked with him would do so.
As part of the scam concerning the construction loan, the former congressman reportedly presented a forged board resolution falsely indicating that the company’s owners agreed to guarantee the loan for the development of Granite Park during a meeting. However, the meeting never took place, and the loan defaulted, resulting in a loss of more than $1.28 million, according to federal authorities.
During his 2018 congressional race, Cox reportedly orchestrated a plot to funnel more than $25,000 in unlawful “straw” or “conduit” contributions from family members and allies to his campaign.
Cox faces up to 20 years in prison and a $250,000 fine for wire fraud and money laundering, up to 30 years in prison and a $1 million fine for wire fraud affecting a financial institution and financial institution fraud, and up to five years in prison and a $250,000 fine for campaign contribution fraud if he is found guilty.
Tuesday afternoon, Cox’s legal representation was not listed in court documents.