Former Congressman Steve Stockman ran 'massive scam' with donations, prosecutors said

Former U.S. Rep. Stephen Stockman, left, speaks with one of his attorneys, Dane C. Ball of Smyker Kaplan & Veselka, before his counsel determination hearing in front of Magistrate Judge Stephen W. Smith at the U.S. District Courthouse Friday, March 24, 2017, in Houston. ( Godofredo A. Vasquez / Houston Chronicle ) less Former U.S. Rep. Stephen Stockman, left, speaks with one of his attorneys, Dane C. Ball of Smyker Kaplan & Veselka, before his counsel determination hearing in front of Magistrate Judge Stephen W. Smith at the ... more Photo: Godofredo A. Vasquez / Godofredo A. Vasquez / Houston Chronicle Photo: Godofredo A. Vasquez / Godofredo A. Vasquez / Houston Chronicle Image 1 of / 5 Caption Close Former Congressman Steve Stockman ran 'massive scam' with donations, prosecutors said 1 / 5 Back to Gallery

A federal prosecutor laid out a wide-ranging fraud case against former U.S. Congressman Steve Stockman, saying the Republican lawmaker stole charitable donations and funneled them through a series of bank accounts and then lied to cover his tracks.

"This case is the story of how the defendant over the course of four years exploited the trust and charity of others to pull off a massive scam," Assistant U.S. Attorney Robert Heberle, of the Justice Department's public integrity division, told jurors during opening statements in the federal corruption trial.

"It is the story of a man who thinks that the rules are for other people," Heberle said. "And it is the story of how, dollar by dollar, investigators followed the money and unraveled the defendant's fraud scheme."

Heberle said Stockman pulled off the scheme by cheating federal election law, lying to donors and blaming mistakes on his staff.

Heberle outlined several major donations Stockman, a trained accountant, solicited on behalf of charitable groups he was involved in, and said the evidence would show that with the help of two aides, Stockman quickly moved that money from one account to another and spent it to cover personal and campaign expenses.

Defense attorney Sean Buckley, however, had a drastically different take on the same series of financial transactions.

"The core is question of whether Mr. Stockman lied with the intent to steal money" from two major donors, Buckley said.

Buckley described his client as a scrappy, naive and idealistic outsider who lost track of his finances.

No matter how slick the government's case is, he told the jury, they should keep in mind that the notion that he would move money around to enrich himself and his political campaigns doesn't jibe with how Stockman has lived his life.

Stockman was homeless and living in city park in Fort Worth in the 1990s, Buckley said. He lives in a modest home, drives "an old beat up van" and eats at McDonald's and Taco Bell. He ran his campaign for U.S. House of Representatives out of a "run down dirty motorcycle repair shop," according to his lawyer.

"This is not a case about fur coats, Rolexes and Mercedes Benzes," Buckley said. It only outlined his client's inability to follow through.

"Stephen Stockman is a bright man, in some sense he may be a political a visionary but he is absentminded ... and he doesn't always follow through on some of the important projects he starts," Buckley said.

Following opening statements, Leanna Saler, an FBI special agent specializing in public corruption cases, took the stand. She began her testimony by following the path of a $350,000 charitable donation by a major donor to a group Stockman headed called Life Without Limits. Saler testified that Stockman deposited the check in a nearly-empty account and began transferring the money to two aides, who in turn wrote checks on it.

A jury is set to hear opening statements in a Houston federal court Tuesday in the corruption trial of Steve Stockman, a former U.S. congressman charged with using more than $1 million in charitable donations to cover personal and political expenses.

The seven women, five men and four male alternates chosen on Monday will hear testimony from dozens of witnesses and could review thousands of pages of documents in what lawyers anticipate will be a month-long trial.

Prosecutors plan to argue that before and during his time in office Stockman siphoned off donations intended for sham nonprofits he set up and laundered the proceeds to pay off various expenses and debts. The former lawmaker faces 28 criminal counts including wire fraud, money laundering, federal election violations and filing a false tax return. Two former associates have pleaded guilty to related charges and may testify at trial.

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Stockman, 61, a resident of Clear Lake, maintains he is innocent. His lawyer, Sean Buckley, said Stockman was always on the brink of poverty and the evidence will show that he never broke the law or intended to commit fraud. He said the trial would hinge on the context in which the donations were solicited and spent.

The first witness will likely be FBI special agent Leanna Saler, according to Robert Heberle, an attorney from the Justice Department's public integrity division.

In addressing five rows filled with potential jurors in her courtroom on Monday, Chief U.S. District Judge Lee H. Rosenthal thanked them for fulfilling their constitutional duty to "serve justice." She explained the lawyers were looking for jurors who could remain unbiased and refrain from being swayed by sympathy rather than facts.

"This case grows out of politics, but I don't care about politics," the judge said. "I only care if your opinions about politics are so firmly entrenched... for example, you just don't like Republicans or you just don't like Democrats and that's going to reflect in your opinion in this case."

Eight hours later, the lawyers had selected 16 jurors from a group of 300 who initially filled out questionnaires in the case.

Gabrielle Banks covers the federal courts and can be reached at Gabrielle.Banks@chron.com