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Ex-Congressman Steve Stockman told aide he would ‘come clean’ if their plot was discovered, aide tells jury

April 3, 2018 GMT

Former U.S. Congressman Steve Stockman’s longtime aide and former campaign treasurer testified Tuesday he knowingly helped carry out an elaborate scheme to defraud the government.

Jason Posey, in his second day as a key government witness in Stockman’s federal fraud trial, said he helped use charitable donations to cover campaign expenses and personal debts for the controversial Texas GOP congressman, who promised him that he would take the heat if anyone found out about their scheme.

Assistant U.S. Attorney Robert Heberle asked Posey why he did what Stockman told him to do.

“I was reliant on the salary,” he said. “I had a certain amount of prestige from the position I held with Mr. Stockman. I really had no other employment prospects at that time.”

Stockman is standing trial in federal court on 28-count federal criminal indictment. Posey and Thomas Dodd, another former aide, have pleaded guilty to related offenses and are testifying in hopes of leniency from the judge.

Both men have provided essential testimony backing the government’s case that the former Republican lawmaker pulled off “a white collar crime spree” tapping into $1.25 million in donations from two top-dollar conservative backers to pay off a variety of unrelated expenditures.

Stockman has pleaded not guilty. His defense lawyers say his spending may not have been prudent or wise, but did not amount to fraud. They have said Stockman’s donors didn’t care how he spent the money.

Posey told the jury Tuesday, however, that he and the former congressman knew they were breaking the law by concealing the source of the funds they were spending. But Stockman instructed him to push forward with his plans to spend charitable money — on hotel rooms, burner phones for secret conversations and contributions to Stockman’s political campaigns — and he complied.

He said he set up a variety of bank accounts at Stockman’s request, including one called the Egyptian American Friendship Society and one called Life Without Limits so the spending would look like it was coming from charitable groups.

At Stockman’s direction, he said, he also wrote a checks with charitable funds to donate $7,500 back to Stockman’s fledgling campaign fund. He later agreed to have his father’s name attached to the donation, when Stockman’s accountant warned the contribution and another $7,500 in donations from Dodd would stand out as “red flags” on the campaign’s federal election filings, because both men worked for Stockman.

When pressed by a prosecutor about why he would agree to a cover-up, Posey said, “He was the boss. I was the employee. I did what he said.”

Stockman assured Posey and Dodd that he would protect them if anyone found out, Posey testified.

“He told Tom and myself if it ever came to light, he would come clean about everything and make sure that Tom and I didn’t take any blame,” said Posey, who was indicted last year.

Gabrielle Banks covers federal court at the Houston Chronicle. Send her tips at gabrielle.banks@chron.com and follow her on Twitter.