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Posted at 12:54 PM ET, 06/06/2011

D.C. attorney general: Harry Thomas Jr. diverted public funds

D.C. Council member Harry Thomas Jr. arranged to have more than $300,000 in public funds diverted to groups he controlled, and used the money as a lavish personal account, purchasing an Audi SUV and taking trips to Las Vegas and Pebble Beach, the city’s attorney general said Monday.

In releasing a highly anticipated report, Attorney General Irvin B. Nathan alleges that Thomas’s inappropriate “conversion” of the money for personal use was “willful, intentional and knowing.” Nathan has filed a civil lawsuit aimed at forcing Thomas (D-Ward 5) to repay the money and intends to refer his findings to the U.S. attorney’s office.

The council member’s behavior “clearly violates the civil laws,” Nathan said at a news conference. “We are extremely disappointed in this violation of public service by Mr. Thomas.”

The allegations represent the culmination of a months-long probe that began with questions about charitable donations but has expanded into much wider concerns about misuse of city funds.

Thomas has been facing questions about his “Team Thomas” organization since his reelection campaign last November. Republican opponent Timothy Day alleged that Thomas has used his nonprofit as a “slush fund” and raised questions about its undisclosed receipts and expenditures. Day also pointed out that a nonprofit group Thomas operated was not registered for a federal tax exemption and that its registration with the District had lapsed.

“That’s the furthest truth from what happened,” Thomas said today, adding that he will hold a 3 p.m. news conference in front of the Wilson building.

Day, who attended Monday’s news conference, called Thomas’s actions a “disgrace” and said he should be forced to repay the money even if it means selling his house and assets.

“This is a disgrace by Harry Thomas and shows that his lifelong quotes of giving back to the children were false,” Day said in an interview. “He clearly gave more to himself.”

According to Nathan’s lawsuit, Thomas intervened with the Children and Youth Investment Trust Corp., a public-private agency that administers grants to youth groups, to deliver $400,000 in city funds earmarked for “youth baseball programs” to a particular group, the Langston 21st Century Foundation.

That group, in turn, sent more than $300,000 back to two organizations controlled by Thomas — the nonprofit Team Thomas and a for-profit business.

“Those funds are all gone,” said Nathan, who is also seeking more than $1 million in damages in his lawsuit. “I want the money back for the District in the fastest possible way.”

The group is now defunct, Thomas has said, but documents have indicated that Thomas was actively raising funds for the group as recently as 2008. Thomas was elected to the council in 2006.

Last fall, Thomas called the nonprofit allegations a “useless fishing expedition” but pledged to release a list of donors and expenses within weeks. He characterized the group as providing “programming to sponsor young people’s activities.”

After the election, Thomas revealed that his group collected and spent about $216,000 in donations since 2008, while Thomas was in office. He said that some of the group’s spending paid for his sports-related trips, including to Atlanta, Florida and to a sporting-goods convention in Las Vegas.

William Miller, a spokesman for the U.S. Attorney's Office for the District, confirmed that federal prosecutors have been investigating Thomas for an undisclosed period of time.

“The U.S. Attorney’s Office is aware of the referral and will review the information provided by the Office of the Attorney General," Miller said in a statement, "as we continue our investigation into this matter.”

Thomas serves as president of the nonprofit group’s board of directors. His wife, Diane Romo Thomas, and sister Debra Truhart were the other members of the board.

Thomas never voluntarily provided an itemized list of donations and expenditures, as he initially promised, and then-Attorney General Peter J. Nickles went to court to force Thomas to release records. Thomas eventually released records to the Office of the Attorney General but has not released them to the public.

During the battles over releasing the records, Thomas sought to portray himself as a victim of a political vendetta from then-Mayor Adrian M. Fenty (D) and Nickles, his attorney general. Frederick D. Cooke, Thomas’s attorney, called Nickles’s probe “blatant retribution” in one court hearing.

Nathan assumed the investigation in January after Nickles left the attorney general’s office. Observers questioned whether Thomas, as a political ally of Mayor Vincent C. Gray (D), would be subject to as tough a probe under Nathan, whom Gray appointed.

Nathan said after his appointment that he would continue the investigation, pledging to issue findings by spring’s end.

In March, the city’s Office of Campaign Finance announced that it was probing whether Thomas fully disclosed his financial dealings with the outside organizations — including the possibility that the group paid for personal travel and an Audi SUV.

Council members are required to file yearly disclosures of gifts and outside income; Thomas declared no such income during the period in question.

By and  |  12:54 PM ET, 06/06/2011

 
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