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Jefferson Faces Hefty Legal Bills

After a federal court froze some of his assets last week, Rep. William Jefferson (D-La.) can still tap into campaign funds and his House salary to pay what likely will be huge legal fees in his battle with the government over a 16-count indictment on corruption charges.

But Jefferson’s campaign war chest is not exactly flush, according to his latest election filings. The Louisiana Democrat reported just $32,963 in cash on hand as of March 31, 2007, in addition to $154,877 in debt.

The Congressman did not raise or spend any money from his legal defense fund this year, according to first-quarter 2007 reports.

Because the legal charges are linked to his official duties, attorneys said Jefferson could use his campaign account to pay what could be daunting legal fees. Some attorneys estimated the cost of a one- or two-month trial, plus pretrial legal expenses, could run upward of $2 million.

A Congressional campaign account “is the one thing he has that Paris Hilton doesn’t,” quipped Ken Gross, a campaign attorney with Skadden Arps.

But that might be small comfort to Jefferson, who pleaded not guilty Friday at the U.S. District Court in Alexandria, Va., to soliciting roughly $500,000 in bribes. The trial date is now set for Jan. 16, 2008, and Jefferson vowed to fight.

“Make no mistake about it. We are at a great disadvantage,” Jefferson said outside the courthouse, flanked by his wife.

Jefferson added that the government was operating on “unlimited resources” and “attempting to break one psychologically and financially.”

Nonetheless, Jefferson said he and his family would “sell every stick of furniture in our home … to clear our name.”

They may have to. According to a court order filed June 7, Jefferson may not use any funds from two bank accounts in the name of corporations allegedly used to shelter bribes. The accounts total $471,800.

But Jefferson’s campaign funds, personal bank accounts and legal defense funds are not restricted.

By nature, white-collar trials are expensive, especially one involving 16 counts. Jefferson’s attorney is Robert Trout of the Washington firm Trout Cacheris PLLC. Jefferson has also hired public relations spokeswoman Judy Smith, whose former high-profile clients include ex-President George H.W. Bush, the family of the late Chandra Levy and former White House intern Monica Lewinsky.

“I think he’s in a serious financial bind,” remarked election lawyer Brett Kappel of Vorys, Sater, Seymour and Pease. “Even with those resources not frozen, those aren’t nearly enough to finance” a trial.

“He’ll be under some financial pressure to strike a deal.”

Kappel argued that while it might be difficult for Jefferson to raise money in Washington, D.C., he still has a base of support in Louisiana, where he was re-elected with 57 percent of the vote in 2006.

After a two-year investigation, the government charged Jefferson on June 4 with 16 counts of racketeering, soliciting bribes, money laundering, obstruction of justice and wire fraud.

The government alleges that Jefferson used his Congressional office to solicit nearly $500,000 in bribes from businessmen to promote their dealings in West Africa. The government alleges his principal partner-in-crime was Vernon Jackson, the CEO of iGate, a telecommunications firm. Jackson pleaded guilty to bribery and is now serving a jail sentence.

Jefferson also became the first lawmaker to be charged under the Foreign Corrupt Practices Act for attempting to bribe Nigerian officials.

But Jefferson also may have to expend further cash in a parallel trial in which he is seeking to protect documents seized during an unprecedented raid on his Rayburn office. Jefferson claims those documents are privileged under the Speech or Debate Clause of the Constitution, while the government argues it was a lawful search.