Former Massachusetts State Representative Pleads Guilty to Embezzling Campaign Funds, Bank Fraud and Tax Fraud
BOSTON – Former Massachusetts State Representative David M. Nangle pleaded guilty today to illegally using campaign funds to pay for his personal expenses, defrauding a bank to obtain loans to purchase his home and repay his personal debts, and collecting income that he failed to report to the IRS.
Nangle, 60, of Lowell, pleaded guilty to 10 counts of wire fraud, four counts of bank fraud, four counts of making false statements to a bank and five counts of filing false tax returns. U.S. Senior District Court Judge Rya W. Zobel scheduled sentencing for June 24, 2021. Nangle was arrested and charged in February 2020.
“Elected representatives are expected to work for the benefit of their constituents, not to line their own pockets,” said United States Attorney Andrew E. Lelling. “Mr. Nangle violated his obligations to the public by siphoning campaign dollars to cover the cost of his personal lifestyle, violating both federal law and the trust placed in him by voters. This office will continue to aggressively investigate and prosecute public corruption in the Commonwealth’s government institutions.”
“David Nangle brokered his powerful position as a Massachusetts state lawmaker to put his own personal, financial, and political interests above the people he was elected to serve, depriving them of the right to honest government,” said Joseph R. Bonavolonta, Special Agent in Charge of the FBI Boston Division. “Corrupt public officials undermine the integrity of our government and inflict lasting damage. Rooting them out is among the most complex and significant work the FBI does for the American people.”
“Elected officials are chosen to serve the people, not themselves,” said Acting Special Agent in Charge Ramsey E. Covington of the Internal Revenue Service-Criminal Investigation Division. “Misusing campaign funds, underreporting income and claiming fraudulent tax deductions on income tax returns are all egregious betrayals of the public’s trust. Corruption of this nature is far too common, and I hope that today’s guilty plea sends a clear message of IRS-CI’s commitment to holding those who commit these dishonorable acts accountable.”
From 1999 to 2020, Nangle was the elected member of the Massachusetts House of Representatives for the 17th Middlesex District. Nangle, who previously served as a House Ethics Committee Chairman, used his campaign committee’s debit card to make personal purchases, including thousands of dollars in gift cards for his personal use, among other things.
During the period of the charged offenses, Nangle was heavily in debt and gambled extensively at area casinos and online, and then used thousands of dollars in campaign funds to pay for various personal expenses such as dues at a local golf club, rental cars to travel to casinos, flowers for his girlfriend, gas, hotels, and restaurants. Nangle knew that using campaign funds for personal use was prohibited and subject to oversight by an independent state agency and concealed his theft by filing false reports that disguised the personal nature of the spending.
In addition, from at least 2015 to 2018, Nangle devised a scheme to fraudulently obtain loans from a bank in order to finance the purchase of his home, fund his gambling activities and repay his personal debts. Nangle did so by making false statements on multiple loan applications, misstating his income and understating his debt.
Separately, Nangle filed false tax returns for tax years 2014 to 2018 by reporting fictitious business deductions for purported “consulting” work that he did for a Billerica company. Nangle also double dipped on deductible expenses arising from his work as a state legislator, fraudulently claiming thousands of dollars in false deductions for alleged charitable donations and misleading his tax preparer. Further, Nangle concealed the income he received through goods and services from business owners and other sources. This included $7,000 in kitchen and bathroom work done in Nangle’s home and $7,000 in check payments from a contractor; gambling income from a Connecticut casino; and thousands of dollars that he stole from his campaign account.
The charge of wire fraud provides for a sentence of up to 20 years in prison, three years of supervised release and a fine of $250,000. The charges of bank fraud and making false statements to a bank each provide for a sentence of up to 30 years in prison, five years of supervised release and a fine of $1 million. The charge of filing false tax returns provides for a sentence of up to three years in prison, one year of supervised release and a fine of $100,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
Assistant U.S. Attorney Dustin Chao, Chief of Lelling’s Public Corruption & Special Prosecutions Unit, and Assistant U.S. Attorney Kunal Pasricha are prosecuting the case.