A politically connected businessman who headed Delaware's largest alcohol distributorship pleaded guilty Thursday to using his company to make hundreds of thousands of dollars in illegal contributions to state and federal candidates.
Christopher Tigani, 40, declined to comment after pleading guilty to two counts of making illegal campaign contributions and two counts of income tax fraud. Tigani, who faces up to 16 years in prison, was released on his own recognizance and will be sentenced Sept. 20.
The scheme may have involved Vice President Joe Biden's 2008 presidential campaign, though he is not accused of any wrongdoing.
"We had absolutely no knowledge of these activities," Biden spokeswoman Amy Dudley said in an email. She did not clarify whether she was referring to Biden himself and his 2008 campaign staff, or only to his current office staff.
Assistant U.S. Attorney David Weiss said only that the investigation is continuing.
"The investigation is broad in scope, that is, it extends beyond election law violations," Weiss said.
Melvyn Monzack, Biden's 2008 campaign treasurer, did not respond to e-mail and phone messages left at his office and home.
Tigani was charged with using nonpayroll checks from his former company, New Castle-based NKS Distributors Inc., to reimburse third-party "conduits" for campaign contributions, violating the limit on individual campaign donations and a 1971 federal ban on corporate campaign contributions.
Prosecutors said Tigani led a scheme that bundled at least $219,800 to state and federal candidates over a five-year period from October 2003 to December 2008, including $70,400 in 2007 to a presidential campaign identified only as Campaign Committee A.
Court documents detail an August 2007 fundraiser Tigani held for NKS employees, ostensibly for providing a venue to make contributions to Campaign Committee A. NKS employees provided about 17 checks made out to the campaign committee, and Tigani reimbursed them.
A campaign representative picked up the checks, along with contributions made by Tigani himself and a relative, and the money was reported to the Federal Elections Commission as being made Aug. 30, 2007.
"The `fundraiser' in fact was a sham," prosecutors said.
Weiss refused to say whether Campaign Committee A was the Biden presidential campaign, but FEC records show that Biden's 2008 presidential campaign reported receiving the maximum individual contribution of $2,300 each from Tigani, his wife and at least three other NKS officials on Aug. 30, 2007.
Funds were also collected in similar fashion two more times in 2007, and the checks went to the presidential campaign committee.
Prosecutor Robert Kravetz told Chief U.S. District Court Judge Gregory Sleet that six contributions in December 2007 were made one day after a staffer for the presidential campaign sent an e-mail to an NKS employee, listing about 13 NKS workers and their last contributions to the campaign, and noting whether their spouses or significant others had contributed as well.
NKS employees made fundraising calls on behalf of candidates during work hours, and the presidential campaign committee used NKS offices after hours to make fundraising calls, prosecutors said. NKS and Tigani did not seek reimbursement for use of the office space or the phones by the presidential campaign, Kravetz said.
According to prosecutors, Tigani was a "large-scale" fundraiser for the presidential campaign committee and had agreed to raise about $100,000 to help pay for billboard advertising in Iowa.
Weiss would not say why his boss, U.S. Attorney Charles Oberly III, had been recused from the case, but Oberly has longstanding ties to Joe Biden and was an outspoken supporter of Biden's eldest son, Beau Biden, when he ran for attorney general in 2006.
A Beau Biden spokesman said federal authorities had contacted his office Thursday about possible state campaign violations, and that state officials would review the information.
Prosecutors said the bundled contributions went to candidates for president, U.S. Senate, governor, lieutenant governor, state treasurer and the General Assembly.
Kravetz said a total of $111,400 involved entities covered under federal campaign laws, including $70,400 to the presidential campaign, $40,000 to the state committee of a major political party, and $1,000 to a U.S. Senate candidate.
Prosecutors claim Tigani's goal was to influence legislation regulating alcohol, and to use his company's influence to obtain two parcels of land in Milford, Del., through a long-term lease with the Delaware Department of Transportation. That deal is subject to a separate federal probe and a lawsuit by Beau Biden's office seeking to nullify the lease.
The News Journal of Wilmington reported last year that Joe Biden's name surfaced in state documents related to the land deal, but a spokeswoman told the newspaper at the time that neither Joe Biden nor anyone in his office had any memory of being involved in the issue. The spokeswoman did acknowledge that Joe Biden and Tigani were "acquainted" and that Tigani attended Biden's inauguration ball.
Prosecutors did not identify in court documents which candidates received the money but said Tigani sought to "curry favor" by making sure the campaigns knew the contributions were associated with his company.
In addition to orchestrating illegal campaign contributions, Tigani also pleaded guilty to two counts of income tax fraud relating to returns he filed for 2005 and 2006.
Prosecutors said Tigani caused NKS' controller to create false entries in an account to which Tigani lent money for NKS' operating expenses, and from which he was reimbursed by having personal expenses paid or by drawing a check against the note.
Prosecutors said the false entries and Tigani's failure to remit to NKS two third-party checks to the company totaling $200,000 resulted in more than $1 million in additional income that he did not report on his tax returns.
Associated Press writers Jessica Gresko and Eric Tucker contributed to this report from Washington.