By Staff, Associated Press, March 4, 2008
4 Mar 2008 // Rep. Rick Renzi pleaded not guilty Tuesday to federal charges including insurance fraud, extortion and money laundering.
The three-term Republican congressman from Arizona's sprawling 1st District made his initial appearance in U.S. District Court, where he was arraigned on charges stemming from a 35-count indictment issued Feb. 21. Two co-defendants also were named in the indictment.
Mr. Renzi, 49 years old , entered pleas of not guilty to a range of other charges including conspiracy to commit wire fraud, mail fraud and wire fraud.
The charges accuse Mr. Renzi of embezzling $400,000 from his family owned insurance agency to help pay for his first campaign and of using his office to promote a land deal that would financially benefit both himself and a former business associate.
U.S. Magistrate Bernardo Velasco ordered Mr. Renzi released on his promise to appear. He was fingerprinted and photographed by federal authorities and released.
Mr. Renzi, who announced last year that he would not be seeking another term in office, spoke briefly with reporters after his court appearance.
"I have a lot of faith in my attorneys," Mr. Renzi said. "I'll be OK."
Defense lawyer Reid Weingarten said Mr. Renzi would stay in office and cautioned against a rush to judgment, saying the presumption of innocence applies to congressmen as well.
Trial is set for April 29, and Mr. Weingarten said the defense was "not going to drag our feet."
Mr. Renzi has felt pressure to resign, including from House Republican leader John Boehner of Ohio, who urged him after his indictment to "seriously consider whether he can continue to effectively represent his constituents under these circumstances."
On Friday, Gov. Janet Napolitano also urged him to step down, saying the federal criminal charges Mr. Renzi faces effectively deprive his district's residents of representation. The mostly rural 1st District takes in at least parts of eight of Arizona's 15 counties.
Some of the crimes he's accused of carry maximum penalties of 20 years in prison, while others have terms of five or 10 years.
In announcing the indictment, authorities said Mr. Renzi and Andrew Beardall, a lawyer and business associate from Rockville, Md., misled customers and state insurance regulators while embezzling premiums from the trust account of the Patriot Insurance Agency Inc.
The agency run by Mr. Renzi's wife operated out of a home in Sonoita, Ariz., which the FBI raided last April. According to the indictment, the money was used for Mr. Renzi's first congressional campaign in 2001 and 2002.
Shortly after the FBI raid, Mr. Renzi stepped down from serving on three congressional committees.
Meanwhile, Mr. Renzi and former business partner James W. Sandlin, a real estate investor from Sherman, Texas, were accused of extortion and conspiring to promote a land swap.
The indictment accused Mr. Renzi of telling groups seeking to get the surface rights to an Arizona copper deposit that they would have to buy land owned by Mr. Sandlin in Cochise County to win required congressional approval for the land exchange.
Earlier, Mr. Renzi had sold Mr. Sandlin his interest in land the two owned in Kingman, Ariz. Mr. Sandlin gave Mr. Renzi $200,000 and a note for $800,000.
While Mr. Sandlin still owed Mr. Renzi $700,000 in 2005, when the first company declined to buy the land owned by Mr. Sandlin, Mr. Renzi allegedly said, "No Sandlin property, no bill."
The second business entity, an investment group, agreed to buy the land in question and Mr. Renzi received $733,000 from Mr. Sandlin for helping with the sale, the indictment said.
It also alleged that Mr. Renzi didn't disclose to either prospective buyer Sandlin's debt to him, nor the $733,000 that Sandlin paid him during 2005. In addition, Mr. Renzi did not disclose in his 2005 financial disclosure statement to Congress his earnings from Sandlin, the indictment said.