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New Indictments Target DeLay Allies

Two political allies of House Majority Leader Tom DeLay (R-Texas) were reindicted in Austin today by a Texas grand jury for allegedly violating the state’s ban on using corporate campaign donations during the 2001-02 election cycle.

John Colyandro and Jim Ellis were reindicted on charges of money laundering, while new accusations of unlawful contributions and criminal conspiracy were added to the list of charges. The money-laundering charge is a first-degree felony, but the other two allegations, while still felonies, carry less severe penalties.

Colyandro and Ellis were first indicted in September 2004 on money laundering charges. Ellis runs Americans for a Republican Majority PAC, DeLay’s federal leadership PAC, while Colyandro is executive director of Texans for a Republican Majority PAC. DeLay helped set up TRMPAC in 2001.

Colyandro was also indicted on 13 counts of unlawful acceptance of corporate political contributions in September 2004. Both he and Ellis sought to have the original indictments thrown out, and Texas courts have yet to make a final ruling on their application.

TRMPAC is at the center of a long-running probe by Travis County District Attorney Ronnie Earle into the use of corporate-campaign donations in 2002 state legislative races in Texas. Texas Republicans secured control of both chambers of the state Legislature that year for the first time since Reconstruction and were able to push trough a Congressional redistricting map that cost a half-dozen House Democrats their seats.

The transaction at the center of this latest indictment was a $190,000 soft money-hard money swap in September 2002 between TRMPAC and the Republican National State Elections Committee, an arm of the Republican National Committee. TRMPAC gave $190,000 in soft money, in this case corporate funds, to RNSEC, which in turn donated $190,000 in hard money to seven state GOP candidates. The use of corporate funds is illegal in Texas legislative races.

Earle alleges that the money swap was illegal, while Colyandro, Ellis and their supporters insist it was standard practice in the days of soft money. Soft money was banned at the federal level following the 2002 elections.

Republicans were surprised by Tuesday’s indictments, and it immediately raised questions about whether Earle was attempting to extend the grand jury, which expires at the end of this month, or mount a new effort to implicate DeLay in his probe. Earle told reporters last week that DeLay was not a target of his investigations, and during a face-to face meeting between the two men on Aug. 17, DeLay was treated more like a witness than a potential defendant, according to sources familiar with their discussions.

Earle is also facing statute-of-limitations problems in his investigation, so Tuesday’s indictments may have been an effort by the county prosecutor to strengthen his case. The TRMPAC-RNSEC swap took place on Sept. 13, 2002, and Texas has a three-year limit on criminal charges being filed in such cases.

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