A former Republican member of Congress from Michigan was indicted Wednesday in connection with his work for a U.S.-based Islamic relief organization that allegedly supported a prominent Afghan warlord.

Mark D. Siljander, 56, a Washington lobbyist who served in the House from 1981 to 1987, was charged with money laundering, conspiracy and obstruction of justice in a multicount indictment by a federal grand jury in Kansas City, Mo.

Federal officials said Siljander was hired in 2004 by the Islamic American Relief Agency of Columbia, Mo., after the group had been listed among organizations banned from receiving government contracts because of concern that the organizations supported international terrorism.

Siljander was paid $50,000 to lobby Congress to restore the firm’s eligibility to receive government work. According to the indictment, the money was stolen by the Islamic American Relief Agency from the U.S. Agency for International Development, which had hired the organization to do relief work in Africa.

Siljander was charged with conspiring to engage in money laundering by transferring stolen USAID funds, and obstructing justice by lying to a federal grand jury and making false statements to FBI agents, officials said.

Siljander allegedly told federal agents that he had not been hired to do any lobbying or advocacy work for the relief agency, and that the funds he received were charitable donations intended to assist him in writing a book about Islam and Christianity.

James R. Hobbs, Siljander’s lawyer, said his client was innocent.

“Mark Siljander vehemently denies the allegations in the indictment and will enter a not-guilty plea,” Hobbs said in a statement. “Mr. Siljander, a former congressman, is internationally recognized for his good-faith attempts to bridge the gap between Christian and Muslin communities worldwide.”

Hobbs said Siljander was never an officer of the Islamic agency or involved in any efforts to engage in prohibited financial transactions with terrorists.

Most of the charges in the 42-count indictment target the Islamic agency and several of its former officers.

The group was shuttered in October 2004 when it was designated a terrorist organization by the Treasury Department. In an indictment filed in March, it was charged with transferring funds to Iraq in violation of federal law. Also named was the group’s former executive director, Mubarak Hamed, a naturalized U.S. citizen from Sudan.

The new, expanded indictment alleges that the group funneled some $130,000 to bank accounts in Pakistan “purportedly for an orphanage” that was housed in buildings controlled by Gulbuddin Hekmatyar. Hekmatyar is founder of Hezb-i-Islami, a militia allied with the Taliban. The U.S. government put Hekmatyar on a list of global terrorists in 2003, making it illegal to support him or his interests.

Siljander, a former salesman of prefabricated homes and state legislator, won a special election in 1981 to fill the House seat vacated by David A. Stockman, who had been named budget director in the new Reagan administration.

Siljander, a favorite of religious conservatives, declared war on abortion, pornography, the Equal Rights Amendment and school busing.

But he lost his 1986 reelection bid after urging clergy members to support him in order to “break the back of Satan.”

He later was appointed a public delegate to the United Nations by President Reagan.

Since leaving Congress, published reports indicate, Siljander has represented a variety of interests, including officials from the governments of Liberia and Sudan.

According to federal court records, he was once hired to do business development work for a Michigan man convicted in 1995 of using embezzled public funds in a failed plan to sell military weapons to Croatia. Officials said at the time that Siljander was not aware that funds he had received might have been stolen.

In 2001, Siljander was a government witness in the federal trial of two executives of a Virginia-based company that promised green cards to foreign investors who invested at least $500,000 in a U.S. business.

Siljander testified that he worked as a consultant to the two defendants but later came to harbor serious doubts about the integrity of the business.

The website for Global Strategies Inc., the lobbying firm Siljander heads in Great Falls, Va., lists references including President George H.W. Bush, assassinated former Pakistani Prime Minister Benazir Bhutto, and several current and former members of Congress.

rick.schmitt@latimes.com

Times staff writer Walter F. Roche contributed to this report.