Prosecutors acknowledged for the first time Monday that the government investigated ties between money manager Nathan A. Chapman Jr. and officials in Gov. Parris N. Glendening's administration but denied defense claims that Chapman was a "consolation prize" in a failed pursuit of the former governor.

The admission came in court filings in which prosecutors sought to prevent the defense from mentioning a rebuke U.S. Attorney Thomas M. DiBiagio drew last week for seeking three "front-page" indictments by Nov. 6, four days after the presidential election. DiBiagio was admonished by his superiors at the Department of Justice, who said the request impaired the office's credibility.

In the U.S. District Court filing, prosecutors said investigators were justified in exploring Chapman's ties to the Democratic administration because of lobbying efforts undertaken by various Glendening officials who sought to give Chapman more state pension funds to manage.

Chapman, a longtime ally of the former governor, is charged with defrauding the pension fund. He is accused of improperly investing a portion of $140 million in pension assets he managed in his own struggling companies, losing nearly $5 million in the process.

Last week, a pension board member testified that Glendening lobbied him personally to increase the assets under Chapman's control, and two other witnesses said they were lobbied by Glendening's chief of staff, Major F. Riddick Jr.

The papers, filed by Assistant U.S. Attorney Jefferson M. Gray on the day the defense opened its case, say Chapman's links to public officials captured investigators' interest after they learned that Chapman was taking hundreds of thousands of dollars of "business development" checks from his companies, converting them into cash and not accounting for them as legitimate business expenses. In light of that discovery, prosecutors said, they investigated whether Chapman was involved in a "pay-to-play" scheme, an illegal arrangement whereby public officials steer business in exchange for cash payments or campaign contributions.

They wrote: "Contrary to what defense counsel has tried to suggest, however, this aspect of the investigation has not focused exclusively on Maryland or on any particular individual within this state" aside from Debra Humphries, a pension board member who has said she had a romantic affair with Chapman.

The judge did not issue a ruling Monday. Chapman's defense team, led by William R. "Billy" Martin, declined to comment, as did prosecutors and DiBiagio.

Gray wrote that "the danger of allowing the defense to try to further develop its theme that this is merely a 'consolation prize prosecution' has been further aggravated by" the controversy surrounding his boss, DiBiagio.

In Thursday's editions, the Baltimore Sun published a report based on internal documents in which DiBiagio pressed his prosecutors for three "front-page White Collar/Public Corruption" indictments by Nov. 6, and said he was embarrassed that his office had not indicted an elected official. The chairman of the state Democratic Party, Isiah Leggett, called for DiBiagio's resignation that morning, accusing the prosecutor of conducting "political witch hunts."

Deputy Attorney General James B. Comey admonished DiBiagio the following day. Comey said that, in order to protect the credibility of the office, he would need to personally sign off on any new public corruption cases brought by DiBiagio.

"In the wake of this publicity -- which may or may not have reached members of the jury -- it is particularly important to keep the current trial focused on Mr. Chapman's conduct," Gray wrote.

Gray said Chapman's attorneys had raised several legitimate defenses, "but jury nullification on the grounds the United States attorney is interested in bringing high-profile public corruption cases is not one of them."

The defense team opened its case with three witnesses Monday, seeking to portray Chapman, a former chairman of the state university system's Board of Regents, as a pioneering African American in the exclusive world of high finance and to call into question the motives of the FBI.

Robert Wallace, an author and former board member at one of Chapman's companies, testified that he declined to be interviewed by investigators. "I was a bit concerned about the motives of the FBI, frankly," said Wallace, who joined the board of directors at Chapman Capital Management Holdings in 1998.

Wallace said Chapman followed the advice of top-class accountants and lawyers in taking the company public, a transaction in which prosecutors say he improperly invested millions from the pension fund. Wallace said he was surprised when newspaper accounts of a federal investigation suggested otherwise.

"It bothered me a bit because I felt that during this analysis and due diligence and preparation for the initial public offering that we had brought in top advisers legally and accounting-wise," Wallace said.

On cross-examination, Wallace admitted that he had no knowledge of Chapman's dealings with Alan Bond, the investment adviser through whom the government alleges Chapman channeled pension money to his own companies.

Nathan A. Chapman Jr. is accused of defrauding Maryland's

pension fund.