Fumo is indicted

State Sen. Vincent J. Fumo defrauded a multimillion-dollar charity, used Senate staff for personal and political errands, and engaged in a cover-up after the FBI and IRS began to investigate him, a grand jury charged today.

Fumo, 63, is charged with 139 counts of conspiracy, fraud, obstruction of justice, and filing false tax returns. If convicted, he faces two to 10 years imprisonment.

The 267-page indictment alleged that Fumo, a South Philadelphia Democrat and one of Pennsylvania's most powerful politicians, exploited the neighborhood charity he helped create and controlled: Citizens Alliance for Better Neighborhoods.

"Besides relying on his income and assets to support his lifestyle, Fumo regularly endeavored to gain personal benefits and gratuities from others, including entities over which he had influence, such as the Senate [and] a nonprofit organization he established and controlled, Citizens Alliance. . . .

"Fumo stated to a close confidant his philosophy that a person is best advised to spend 'other people's money,' " the grand jury said. "Fumo often referred to this goal by the acronym OPM."

The grand jury also alleged that Fumo used his legislative staff for personal and political purposes.

"Defendant Vincent J. Fumo systematically, routinely, and improperly used the funds and resources of the Senate for his personal and political benefit," the grand jury said. "He directed that Senate contractors and employees employed by the Senate serve him in any manner he desired . . . to further his political goals and attend to his personal wants."

The indictment stated, for example, that one $31,000-a-year Senate aide served as Fumo's housekeeper, cleaning his Spring Garden mansion about once a week during time compensated by the Senate.

And Fumo gave a Senate contract - which ultimately reached more than $40,000 a year - to a private investigator who was assigned by Fumo to an array of "personal and political missions," such as conducting surveillance on Fumo's former wife and girlfriends, according to the indictment.

Fumo also used Senate contracts to compensate two close friends who were paid with Senate money - collectively totaling more than $430,000 over five years - but who did little or no Senate work at all, the indictment charged.

The grand jury also alleged that Fumo:

- Used Senate employees as campaign aides.

- Used Citizens Alliance to fund political polls.

- Took trips to Cuba paid for by Citizens Alliance.

- Defrauded the Independence Seaport Museum.

- Used Citizens Alliance to pay for "tens of thousands of dollars of goods," including tools.

- Used Citizens Alliance to buy a bulldozer to clear land on his 100-acre farm.

- Used Citizens Alliance to fund a grassroots group at the Shore to help stop a dune replenishment program that threatened to block his view.

U.S. Attorney Patrick Meehan said at a news conference this morning that Fumo "used his power to build an empire" to serve citizens, but "constantly diverted" money to serve his political and private agenda.

"Sen. Fumo didn't just step over the line, he completely ignored it," Meehan said.

The indictment further charged that Fumo used Citizens Alliance employees as his personal workers. It alleged that Citizens Alliance laborers painted the dock and deck at his Shore house in Ventnor and were sent to power-wash the deck at his Spring Garden house.

Citizens Alliance purchased equipment that Fumo used at his farm, near Harrisburg - including a $27,000 used bulldozer, and provided him with the free use of other equipment, including a lawn tractor, a dump truck, a backhoe and a pickup truck, the indictment stated.

Citizens Alliance had no use for the bulldozer, the indictment said. Indeed, it said the charity "employed no one who was even qualified to operate such heavy equipment." Even so, Citizens Alliance paid an additional $16,000 to repair the bulldozer when it broke down a few months later, the charges stated.

Ruth Arnao, 50, a former senior Fumo Senate aide who served as the charity's executive director, was also charged with conspiracy and filing a false income-tax return.

The obstruction-of-justice charges against Fumo are related to an alleged effort to thwart the FBI investigation by deleting e-mail.

Two other former Senate aides, Leonard Luchko and Mark Eister, were charged with obstruction of justice in May. Prosecutors unsuccessfully tried to get Luchko and Eister to testify against Fumo.

Fumo, who has served in the Senate for 29 years, has vowed to fight the charges and called them politically inspired by the Bush administration.

Neither Fumo nor his lawyer could be immediately reached for comment.

Yesterday, Fumo took the floor of the state Senate to try to steal some thunder from today's indictment.

"I know in my heart that I have not done anything illegal," the Philadelphia Democrat said during a 12-minute speech on the Senate floor, his voice at times somber, at times bitter.

"Sometimes in life the only choice we have when we face blatant injustice is to have the courage to stand up and fight. That is what I will do."

Also yesterday, Fumo stepped down from a powerful committee post - a day before the presentation of the annual state budget - but will remain in the Senate.

Citizens Alliance is funded mainly by public dollars and Peco Energy donations, with most of its money won with Fumo's influence or help. Its assets exceeded $20 million in 2002, the last tax year for which it filed a return with the IRS.

Fumo has extolled the charity's good works: rehabbing the Passyunk Avenue commercial strip, subsidizing charter schools, and donating to worthy causes.

Fumo has been indicted twice before: in 1973 over vote fraud and in 1980 over putting ghost employees on the state payroll. Charges in the first case were quickly dropped; he was convicted in the second, but a judge later threw out the conviction.