Dan Morales charged in 12-count indictment
By PATRICK CROWLEY
7/2/2003

A former Texas Attorney General is facing federal charges that include lying to obtain a $600,000 mortgage and using $400,000 in campaign funds for a down payment and improvements on the $775,000 home.

Dan Morales is charged in a twelve-count indictment returned by a federal grand jury with making false statements on a loan application, mail fraud, conspiracy, and filing a false tax return, said U.S. Attorney Johnny Sutton of Austin, Texas.

Morales, 47, a Democrat who in 2000 ran unsuccessfully for governor, has pleaded innocent to the charges and is in jail in Austin awaiting an Oct. 7 trial.

Making a false statement in a loan application is punishable by up to 30 years in prison, a $1 million fine, and five years of supervised probation after release, according to the U.S. Attorney's office.

"This is a case of an elected official charged with abusing the public trust," Sutton said in a statement when Morales was charged in March. "As Attorney General of Texas, Dan Morales had an obligation to the people of this state to be honest, loyal and fair, but he violated that trust by back-dating contracts, forging government record, and converting campaign contributions to personal use."

Attorneys for Morales, who left office in 1999, could not be reached to comment. Morales was first elected in 1990 and then won a second term as Texas' top law enforcement officer in 1994.

According to the indictment, Morales entered into a contract in January, 1998, to purchase a $775,000 home.

In order to make the down payment and to pay for improvements to the home the government alleges he transferred approximately $400,000 from his campaign funds to his personal account.

Also indicted was Houston lawyer Marc Murr on federal charges of mail fraud and conspiracy. He has also pleaded innocent and is awaiting trail.

The U.S. Attorney's office said Morales and Murr are accused of trying to fraudulently obtain millions of dollars for Murr disguised as attorney's fees generated from Texas' $17.3 billion settlement in 1998 with the tobacco industry.

Beginning in 1997 and continuing until June of 1999, Morales and Murr devised "a scheme to defraud and obtain money and property by means of false and fraudulent pretenses," the U.S. Attorney's office said.

Morales used the "authority, prestige, and influence of the state and office of the Attorney General for the benefit and enrichment of his friend, Marc Murr," federal investigators said.

Morales solicited the payment of millions of dollars to Murr from lawyers working on the settlement but "made misrepresentations about the nature and extent of work performed by Murr," the government alleges.

"This investigation underscores the FBI's commitment to uprooting public corruption at the highest levels and demonstrates that no one is above the law," FBI Special Agent in Charge Steve C. McCraw said in a statement released by the U.S. Attorney's office.

Each count of mail fraud and conspiracy carries a penalty of up to five years in prison and a $250,000 fine. Filing a false tax return is punishable by up to three years in prison and a $100,000 fine.

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