Inside This Ex-Texas Congressman’s Absolutely Bonkers Federal Fraud Trial

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Outlandish former Texas congressman Steve Stockman resurfaced last spring when he was arrested by federal agents while trying to board an international flight and subsequently slapped with a 28-count felony fraud indictment, which he said was the work of the “deep state.”

Stockman’s trial is currently in its second week in a federal court in Houston. And it’s a doozy.

The far-right Republican firebrand is accused of using hundreds of thousands in charitable donations from two conservative mega-donors for personal expenses in what prosecutors call a “white-collar crime spree.” They say he’s used the money to spy on political rivals with Inspector Gadget-style tools, to pay off his credit card debt, to go on dolphin boat rides, and to buy up copies of pop-up Advent books published by his brother.

Stockman, who served in the U.S. House from 1995 to 1997 and again from 2013 to 2015, earned a reputation as a tea party favorite eager to buck his party’s establishment. He invited Ted Nugent to President Obama’s State of The Union speech, and his campaign once produced a bumper sticker saying: “If babies had guns, they wouldn’t be aborted.”

Stockman is facing multiple counts of mail and wire fraud, conspiracy to make false statements, and money laundering, among other charges. Federal prosecutors have compiled reams of evidence, including texts, emails, and records of bank transactions and wire transfers. Their case has been aided by cooperation from two of Stockman’s former aides, who struck plea deals with the government.

But Stockman is fighting the charges while free on $25,000 bond. An anonymous private benefactor is ponying up the funds for his trio of defense lawyers after he told a judge last year that he had only $17 in his bank account.

Stockman enlisted ‘sting’ operatives to spy on political rivals

Among Stockman’s wildest expenditures: $50,000 he shelled out to hire a conservative “sting” outfit to spy on his political rivals in amateurish, ultimately fruitless ways.

The main target of this campaign was James White, a black member of the Texas House who Stockman feared might primary him in 2014. Stockman fretted in a text to an associate: “Republicans love black conservatives.”

Conservative activist Ben Wetmore carried out the three-month surveillance campaign against White on Stockman’s behalf, according to the Houston Chronicle. Wetmore installed Shaughn Adeleye as a plant in White’s office, where he served as an intern, kitting him out with a watch and pen equipped with audio equipment.

Adeleye and another amateur sleuth testified that they were tasked with tracking White’s movements, trying to “catch him cursing” and uncover damning evidence like whether his car was messy, per the Chronicle.

Adeleye and Wetmore are onetime allies of another conservative operative who fancies himself a skilled practitioner of the dark arts: James O’Keefe. Wetmore worked with O’Keefe on several hidden camera projects in the late 2000s, while Adeleye was involved with O’Keefe’s infamous sting against NPR.

Wetmore declined a request for comment, citing TPM’s coverage of his past undercover work.

“I’ve had bad experiences in the past with TPM’s attribution of my quotes and dishonesty with what I’ve said, so I won’t be accepting your kind offer,” Wetmore wrote in a Facebook message. “I hope you know it’s not about you, but once you see substantive dishonesty from an outlet, you don’t go back for more.”

“I hope you do research and report honestly about Stockman, he deserves a lot better reporting than he’s currently receiving,” Wetmore added.

Stockman went to Egypt to try to get money from a cement company

Stockman sought funds far and wide, even soliciting assistance from top officials from the Egyptian defense ministry.

In a bizarre twist detailed by the Chronicle, Stockman used some of his donors’ funds to pay for a trip to Egypt to try to coax officials there into helping him secure a $30 million donation from international cement company CEMEX.

The Texas Republican reportedly told Egyptian officials that the money would go either towards “educating Americans about the historic importance of Egypt” or “toward shipping medical supplies to Egypt and Africa.”

The pitch failed.

Other expenses related to this gambit included paying Tera Dahl, a former Breitbart News writer who served as deputy chief of staff on the National Security Council, to arrange the meetings with Egyptian leaders. Dahl, who left the NSC shortly before her ally Steve Bannon was fired from the White House, testified that she believed Stockman did “care about the cause” of improving Egypt-U.S. relations, per the Chronicle.

“Freedom House” to train interns never materialized

Stockman pledged to use the huge donations he secured to create a nerve center of sorts for conservative interns working on Capitol Hill. He described plans to renovate a large home where interns would live and be instilled with “the ideas of liberty.”

This vision for the so-called “Freedom House” never quite panned out.

Instead, as Stockman’s short-lived fundraising director Sean McMahon testified, interns worked out of a lobbying firm making up to 2,000 fundraising calls a day.

McMahon, who the Chronicle reported quit after just four days, testified that working conditions were “horrific” and that interns had to scramble to find their own housing.

Some $82,000 of the money Stockman received for the training center evaporated within a week, going towards storage fees, credit card debt, and campaign costs, as the Chronicle reported. The funds were also diverted to expenses including $11,000 for a friend’s 30-day rehab treatment and $24,000 for 500 copies of pop-up Advent books published by Stockman’s brother.

Stockman lawyers say donor was fine with the spending

Stockman’s mysterious donor, left anonymous in the indictment, turns out to be billionaire Illinois shipping magnate Dick Uihlein, one of the largest benefactors of the political far right.

Uihlein testified that he gave Stockman one $350,000 check to refurbish the “Freedom House” and another for $450,000 to cover costs for a tabloid newspaper intended to boost Stockman’s unsuccessful 2014 primary campaign against Texas Sen. John Cornyn. The bulk of that $800,000 went towards other purposes, prosecutors say.

Stockman’s defense hinges on the claim that Uihlein didn’t object to the way the funds were used.

“Our position is the donor didn’t care what the money was used for,” Sean Buckley, one of Stockman’s three lawyers, has argued, per the Chronicle.

But Uihlein’s testimony didn’t seem to support that. “I felt they were trustworthy,” he said in court. “And I trusted that they would spend the money the way they said.”

The low-profile billionaire is certainly not short on funds. Politico reported that Uihlein and his wife are the biggest GOP donors of the 2018 midterm elections so far, having shelled out $21 million to federal candidates and super PACs and an unknown amount toward state candidates.

Another donor’s money went to dolphin tours, airline tickets

Stockman’s other major backer was revealed to be Stanford Rothschild, Jr., a Baltimore money manager and art collector who gave $450,000 to Stockman’s various pursuits between 2010 to 2012, according to the Chronicle.

That money went towards a slew of personal expenses including tanning salon visits, dolphin boat rides, airline tickets to Sudan, and a new dishwasher, per the newspaper.

Rothschild passed away shortly before Stockman’s indictment came down in early 2017, so he can’t testify as to whether that was how he preferred his charitable donations to be spent.

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