Federal authorities arrested former Rep. T.J. Cox, California Democrat, on Tuesday on charges related to various fraud schemes that stole over $1.7 million during a five-year period.
The U.S. Attorney’s Office for the Eastern District of California said that it unsealed an indictment against Mr. Cox, 59, and charged him with 15 counts of wire fraud and 11 counts of money laundering.
He was also charged with a single count each of financial-institution fraud and campaign-contribution fraud.
Mr. Cox, of Fresno, defeated incumbent Republican David Valadao in California’s 21st congressional district as a part of the Democratic wave election in the 2018 midterms. Mr. Valadao won back his seat in a 2020 rematch.
Prosecutors accused the one-term Congressman of illegally obtaining the money in client payments, company loans and investments in two different fraud schemes from 2013 to 2018.
Mr. Cox solicited companies with which he was affiliated as well as their clients and vendors under false pretenses, according to the U.S. attorney’s office, and then directed those payments into an unauthorized, off-the-books bank account.
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He also allegedly obtained a $1.5 million construction loan by fraudulent means in order to redevelop Fresno’s Granite Park.
Mr. Cox and his business partner’s nonprofit group couldn’t qualify for the loan without a guarantor, so prosecutors said that Mr. Cox fabricated a board resolution from one of his affiliated companies that claimed it would fulfill that obligation.
No board meeting ever took place and the other owners did not agree to back the loan, according to the attorney’s office. The loan later went into default and caused a nearly $1.3 million loss.
The former congressman had also enacted a scheme to reimburse associates and family members for their contributions to his 2018 campaign by arranging for over $25,000 in illegal straw donations in 2017, according to federal authorities.
Mr. Cox faces up to 20 years in prison and a $250,000 fine.
• Matt Delaney can be reached at mdelaney@washingtontimes.com.
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