(CNN) California GOP Rep. Duncan Hunter's wife Margaret pleaded guilty on Thursday to conspiring with her husband to "knowingly and willingly" convert campaign funds for personal use. She has agreed to cooperate with prosecutors.

Both Hunters previously pleaded not guilty to federal charges that they had stolen a quarter of a million dollars in campaign funds to furnish a lavish lifestyle that was beyond their means.

Margaret Hunter's agreement to cooperate with prosecutors was a huge development in the federal case that poses a legal and political threat to her husband, the sitting congressman.

Margaret Hunter appeared alone with her lawyers in a federal district court in San Diego before Judge Thomas Whelan, where she changed her plea in the high-profile case. The congressman did not appear with his wife on Thursday.

In a series of exchanges with the judge -- where she simply answered "Yes" -- she acknowledged she was a member of the conspiracy and as part of that conspiracy, she and her husband spent tens of thousands of dollars on family vacations, knowing those costs were outside the family's budget.

In response to the judge, she also acknowledged that Duncan Hunter attempted to set up a one-day tour of a naval base in Italy to justify their Italian vacation -- one of the examples prosecutors have cited as evidence that the congressman used his position of power for personal gain.

In pleading guilty, she is acknowledging that, overall, they spent more than $200,000 in campaign funds for personal use.

The plea agreement for Margaret Hunter released by the government said she would "make a good faith effort to provide substantial assistance to the United States in the investigation and prosecution of others."

Following Thursday's court hearing, Hunter's lawyer Thomas McNamara read a brief statement on her behalf.

By pleading guilty, she said in the statement, "I have fully accepted responsibility for my conduct. I am deeply remorseful, and I apologize. I am saddened for the hurt that I have caused my family and others. I understand that there will be more consequences stemming from my actions, but as demonstrated this morning with the entry of the plea, I've taken the first step to face those consequences."

McNamara said Hunter will not be speaking any further. When asked whether Hunter will testify against her husband, her attorney said he was not going to answer any questions.

She is set to be sentenced on September 16 and faces a maximum of five years in jail.

In a statement on Thursday, Duncan Hunter asserted that he and his wife were targeted by the Department of Justice for political reasons.

"As Margaret's case concludes, she should be left alone," he said. "I am the Congressman, this is my campaign and any further attention on this issue should be directed solely to me."

The indictment against Hunter and his wife came last August, months ahead of his re-election campaign. At the time, he denied wrongdoing and shifted blame to his wife , who was at one point also his campaign manager.

Duncan Hunter has said the charges were made in error, and Federal Election Commission reports showed he repaid tens of thousands of dollars to his campaign account.

A former Marine who had combat tours in Iraq and the son of former California GOP Rep. Duncan L. Hunter, the congressman has courted controversy throughout much of his career.

He also agreed to step down from his congressional committee assignments, and went on to win reelection, after running an anti-Muslim campaign against his Democratic opponent.

He has been in the headlines again for stoking a separate controversy with his forceful defense of Edward "Eddie" Gallagher, a Navy SEAL who is accused of war crimes and who President Donald Trump has reportedly considered granting clemency.

In an interview with CNN last week, he clarified that he never targeted civilians, but said that those unintended civilian deaths are a consequence of war.

Though the 50th Congressional District is a strongly Republican district, many voters have told CNN in interviews over the last year that they were greatly dismayed by Hunter's conduct -- and his inference, at one point, that his wife was to blame for the improper spending.

He has already drawn several political opponents, including Democrat Ammar Campa-Najjar, a former Obama Labor Department official, who he defeated in 2018. Campa-Najjar raised more than $300,000 in the first quarter of this year for their potential rematch.

"Mrs. Hunter's decision to separate her legal defense from the congressman reinforces what I've heard from many on the campaign," Campa-Najjar said in a statement Thursday. "From Alpine residents who voted against Hunter in 2018, to Republican leaders who stripped him from his committee assignments, to Mrs. Hunter parting with the congressman's not guilty plea: Those who know Hunter the most, trust him the least. We simply can no longer afford the costs of Hunter's corruption in CA-50."

The congressman maintains that his wife was pressured into cooperating with prosecutors, who he says are politically motivated by the desire to win his district.

But the 22-page court plea agreement includes a series of damning admissions by Margaret Hunter about her husband's conduct. In the document, Margaret Hunter admits that she repeatedly conspired with her husband between 2009 and 2016 to use campaign funds to cover routine expenses like groceries, as well as couples outings with their friends to the track at Del Mar and other restaurants, lavish family gatherings at the Hotel Del Coronado, a $14,263 Italian vacation that the family could not have otherwise paid for, and a family trip to Minnesota in which they spent $250 in campaign funds on air transport for the family bunny, EggBurt. (Much of that spending was repaid to the campaign account by Duncan Hunter after the charges were revealed in the press).

While the congressman has vowed to fight all charges, his wife's admissions in the plea agreement are likely to take a heavy toll on his already damaged image.

Several Republicans, who could be strong contenders for the seat, are eyeing the race and waiting to see what happens in Hunter's trial, which is currently set for September.