Two Virginia Businessmen Charged with Illegally Reimbursing Senate and Presidential Campaign Contributions
WASHINGTON - A federal grand jury in Alexandria, Va., today returned an indictment charging William P. Danielczyk Jr. and Eugene R. Biagi with reimbursing $186,600 in contributions to the Senate and Presidential campaign committees of a candidate for federal office, and obstructing the Federal Election Commission (FEC) and the FBI, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division, U.S. Attorney Neil H. MacBride of the Eastern District of Virginia and James W. McJunkin, Assistant Director in Charge of the FBI’s Washington Field Office.
The indictment charges Danielczyk, 49, of Oakton, Va., and Biagi, 76, also of Oakton, each with one count of conspiracy, two counts of reimbursing contributions, one count of using corporate funds to reimburse contributions and one count of obstructing justice. The indictment also charges Danielczyk with two counts of causing false statements to be submitted to the FEC.
The defendants are expected to make initial court appearances Friday in U.S. District Court in Alexandria.
According to the indictment, Danielczyk co-hosted a September 2006 fundraiser for a candidate’s 2006 campaign for the U.S. Senate, and in March 2007, he co-hosted a fundraiser for the same candidate’s 2008 campaign for President of the United States. Danielczyk and Biagi allegedly reimbursed $30,200 to eight contributors to the 2006 Senate campaign, and reimbursed $156,400 to 35 contributors to the 2008 Presidential campaign. Additionally, the indictment alleges that Danielczyk and Biagi reimbursed the contributions to the 2008 Presidential campaign with corporate funds.
As part of the scheme, Danielczyk and Biagi allegedly created and distributed back-dated letters to 15 contributors that falsely characterized reimbursements for contributions as “consulting fees.” According to the indictment, Danielczyk and Biagi also created checks to 17 contributors containing a memorandum line falsely stating that each check was for “consulting fees.” In addition, according to the indictment, some or all of these checks were delivered with back-dated letters falsely stating that the contributor had received and would receive money for certain work.
According to court documents and information presented in court, Danielczyk and Biagi were aided by Danielczyk’s assistant, April G. Spittle. On Feb. 4, 2011, Spittle pleaded guilty in the Eastern District of Virginia to one count of making reimbursed contributions to the 2008 Presidential campaign.
According to a statement of facts filed with her plea agreement, Spittle participated in raising the $186,600 in reimbursed contributions at Danielczyk’s direction, received her own contribution reimbursement from Biagi, and distributed other reimbursement checks from Biagi. According to the court documents filed at the time of her guilty plea, Spittle participated, at Danielczyk’s direction, in creating back-dated and false letters for Biagi's signature, which sought to disguise the reimbursed contributions.
According to the indictment, Danielczyk caused the candidate’s campaign committee to unwittingly file with the FEC a 2007 report containing false information about the source and amount of contributions to the campaign. Danielczyk allegedly also caused the submission of correspondence to the FEC, which falsely stated that reimbursements of contributions to a candidate were bonus payments for work performed.
The maximum penalty for the conspiracy charge is five years in prison, while the charges of reimbursing contributions and contributing corporate funds each carry a maximum penalty of 10 years in prison. Obstruction of justice is punishable by up to 20 years in prison, and each count of making a false statement carries a maximum penalty of five years in prison. Each count of the indictment is additionally punishable by a $250,000 fine, with the exception of the reimbursing contribution counts, which are punishable by a fine of up to 10 times the contribution amount.
An indictment is merely an accusation, and defendants are presumed innocent unless proven guilty in a court of law.
This case is being prosecuted by Richard C. Pilger, Director of the Election Crimes Branch of the Criminal Division’s Public Integrity Section, Trial Attorney Ethan H. Levisohn of the Public Integrity Section, and Assistant U.S. Attorney Mark D. Lytle. The case was investigated by the FBI.