The crest of the United States Department of Justice is seen at its headquarters in Washington, D.C., U.S., May 10, 2021.
The crest of the United States Department of Justice is seen at its headquarters in Washington, D.C., U.S., May 10, 2021. Reuters / Andrew Kelly

KEY POINTS

  • Cox was charged with 15 counts of wire fraud among others
  • The former California congressman allegedly "stole" client payments and company loans
  • Cox was accused of planning to reimburse family and acquaintance donations

A former member of Congress has been charged with multiple fraud schemes and other fraudulent activities related to money laundering. The Department of Justice (DoJ) said that former Democratic California congressman Terrance John "TJ" Cox obtained "over $1.7 million in diverted client payments" for a period of six years.

In a press release published Tuesday, the DoJ revealed that Cox was charged with 15 counts of wire fraud, 11 counts of money laundering, one count of financial institution fraud and one count of campaign contribution fraud.

The DoJ revealed that the 28-count indictment was unsealed Tuesday in the Eastern District of California. According to the indictment, the 59-year-old politician "perpetrated multiple fraud schemes targeting companies he was affiliated with and their clients and vendors." Cox allegedly created "unauthorized" bank accounts to divert the money of clients into fraudulent accounts "through false representations, pretenses and promises."

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"From 2013 to 2018, across two different fraud schemes, Cox illicitly obtained over $1.7 million in diverted client payments and company loans and investments he solicited and then stole," the DoJ stated.

It said that Cox received a mortgage loan for a property he rented out to someone else – contrary to his statements when he applied for the loan that he intended to live in the property, NBC News reported.

Cox is also accused of obtaining a construction loan of $1.5 million for the development of Granite Park in Fresno. To qualify for the loan, Cox allegedly "falsely represented that one of his affiliated companies would guarantee the loan." Since the company whom Cox claimed would guarantee the loan did not agree, Cox allegedly submitted a fabricated document that falsely stated all company owners agreed to the loan.

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Cox, who represented California's 21st Congressional District from January 2019 to January 2021, was also accused of setting up a plan that should reimburse donations to his family and friends. For this scheme, he "arranged for over $25,000 in illegal straw or conduit donations to his campaign in 2018," the indictment documents showed.

According to CNN, Cox established a number of companies, including the Central Valley New Market Tax Credit Fund, which raises funds for low-income neighborhoods.

If found guilty of the money laundering and fraud charges, Cox could face up to 20 years behind bars plus a $250,000 fine, CBS News reported. If found guilty of fraud charges related to financial institutions, Cox faces a maximum of 30 years in prison and a $1 million fine.

Cox pleaded not guilty during his Tuesday arraignment.