Jul 11, 2008 10:11 pm US/Pacific
SF Fundraiser Guilty Of Illegal Campaign Donations
SAN FRANCISCO (AP) ―
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Former California Secretary of State Kevin Shelley.
A federal jury on Friday convicted a San Francisco fundraiser on charges related to the illegal funneling of state grant money to the campaign of former secretary of state Kevin Shelley.
Julie Lee, a 61-year-old real estate agent, was convicted on two counts of mail fraud and three counts of attempted witness tampering. Those counts say she tried to persuade three people to give false information to federal agents.
The investigation revolved around campaign contributions Lee's associates made to Shelley while he was running for secretary of state in 2002.
While he was a state lawmaker, Shelley helped secure a $500,000 state grant for Lee's foundation. The money was intended to develop a community center.
Instead, federal prosecutors said Lee funneled $125,000 from the grant into Shelley's campaign using six intermediaries. There is no indication Shelley knew about the illegal donations.
U.S. Attorney McGregor Scott called Lee's actions reprehensible.
"The very notion of laundering state grant funds for a community center of all things and converting them to political campaign contributions is beyond the pale," he said in a statement after the jury's verdict.
Lee was acquitted on two counts of mail fraud.
A federal grand jury indicted Lee on the charges in 2005. She now faces 20 years for each of the two mail fraud counts and 10 years for each of the three counts of witness tampering.
Lee remains free on $25,000 bond pending sentencing, scheduled for Sept. 23.
The charges against Lee stemmed from the efforts prosecutors said she made to cover up the misuse of the grant money. Those included creating false and misleading documents and lying to investigators and auditors from the state Department of Parks and Recreation.
After the verdict, Lee's defense lawyers declined comment, saying their client still faces similar charges in San Francisco County Superior Court.
Shelley, a Democrat, resigned as secretary of state in 2005 amid allegations that his office misused federal election money.
(© 2009 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)
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