Former Rep. TJ Cox speaks with business owners at the Fresno Chamber's Eggs and Issues Breakfast in March 2019. Photo by Gabriel Dillard
Written by The Business Journal Staff
Former Central Valley Congressman T.J. Cox was booked Tuesday morning into Fresno County Jail on 28 federal counts — arrested by the FBI on allegations including money laundering, wire and campaign contribution fraud.
An indictment, unsealed Monday by the federal Eastern District of California court, includes 15 counts of wire fraud, 11 counts of money laundering, one count of financial institution fraud and one count of campaign contribution fraud, according to a news release from the Department of Justice.
Prosecutors allege Cox funneled money for personal use from various companies, including Central Valley New Market Tax Credit, LLC, Central Valley Community Sports Foundation and an almond processing company.
Before being elected Democratic representative for California’s 21st District, Cox stepped down from his positions at the Central Valley NMTC and at CVCSF.
In the court filings, prosecutors cite specific instances of deposits intended for Central Valley NMTC that instead went to Cox’s pass-through company, which would then be used for personal expenses, for his other businesses and to pay personal and business debts.
Prosecutors accuse Cox of stealing $1.7 million in diverted payments, loans and investments in two different fraud schemes involving his companies from 2013 to 2018.
The indictment also alleges Cox used one of his companies to guarantee a $1.5 million loan to develop Fresno’s Granite Park, unbeknownst to his business partners. The loan then went into default, causing a loss of more than $1.28 million.
Prosecutors also allege Cox fraudulently received mortgage loan funds for a property he intended rent to a third party.
Cox is also accused of siphoning money from his companies to go to associates who would then donate to his campaign for Congress. Cox served from 2019 to 2021.
If convicted, Cox faces a maximum penalty of 20 years in prison and $250,000 in fines for wire fraud and money laundering counts. For the wire fraud counts to a financial institution, Cox could face up to 30 years and $1 million in fines. He could face five years and $250,000 in fines for campaign contribution fraud. U.S. Attorney Phillip Talbert made the announcement. The FBI and IRS are investigating the case.
Assistant U.S. Attorneys Henry Carbajal and Jeffrey Spivak are prosecuting the case.