State Rep. Fed Gambling Habit With Campaign Funds: Prosecutors

LOWELL, MA — State Rep. David Nangle used campaign funds to support his gambling habit and pay for personal expenses — from golf club dues and rental cars to flowers for his girlfriend — federal prosecutors said following the Lowell Democrat's arrest Tuesday morning.

Nangle, who represents Lowell and Chelmsford on Beacon Hill, sits on the House Ethics Committee. He was indicted on 28 charges, including 10 counts of wire fraud, four counts of bank fraud, nine counts of making false statements to a bank and five counts of filing false tax returns.

He pleaded not guilty on all charges, and his attorney said he plans to fight the charges.

“David Nangle is a good man who has proudly served his district as a State Representative,” said his lawyer, William Connolly, in a statement, the Globe reported. “The charges against David are merely allegations."

Prosecutors said Nangle, 59, was arrested following a three-year FBI investigation.

"Corruption can be easy and tempting for local government officials," said U.S. Attorney Andrew Lelling at a press conference, calling Nangle's activities "a systematic pattern of theft and fraud."

Lelling said Nangle had been audited by the government several times and continued despite the fact his use of funds was under scrutiny.

"We expect our elected officials to look out for our best interests; we do not expect them to trade on their positions of power for their own benefit," said Joe Bonavolonta of the FBI's Boston division. "Rep. Nangle abused the trust of his constituents and contributors by using his campaign funds for his own personal use to sustain his gambling and keep himself afloat financially after incurring tens of thousands of dollars in debt."

Nangle was elected in 1998 to represent the 18th Middlesex District. Since 2003 he's represented the 17th Middlesex District, which covers parts of Chelmsford and Lowell. He sits on the House Committee on Ethics, the House Committee on Rules, and the Joint Committee on Rules, according to his state biography.

Nangle's base salary was as much as $62,500 as a state representative from 2014 to 2018. He also received thousands of dollars as reimbursement in the form of office expenses, miles, meals and lodging, according to court documents. In 2017 and 2018, he also earned another $30,000 for his position as second division chair — a member of the House Speakers leadership team. And for his chairmanship positions in 2015 and 2016, he got another $7,500 yearly.

Still, according to court documents, Nangle was heavily in debt, had poor credit and regular cash flow problems and borrowed thousands of dollars from friends and family because of "extensive gambling."

To keep himself afloat as far back as 2014, prosecutors allege, he turned to his campaign finance funds. Lelling said Nangle also lied on four bank loan applications, forged a consulting agreement and another form. He also disguised gambling expenses. Overall, he secured over $300,000 in loans through fraud. He also had an agreement with a contractor who did work on his home for free and was later awarded several lucrative contracts using state funds, Lelling said.

According to the indictment, Nangle filed false tax returns for tax years 2014 to 2018 by reporting fictitious business deductions for purported “consulting” work that he did for a Billerica company. Nangle allegedly double dipped on deductible expenses arising from his work as a state legislator, fraudulently claiming thousands of dollars in false deductions for alleged charitable donations, and misleading his tax preparer.

Bonavolonta said Nangle spearheaded several fraud schemes using the power of his position on Beacon Hill and enlisted several others.

"If the allegations are true, it's fair to say he in the violated the public trust and especially the trust of people who donated to his campaign," said Lelling, adding, "There are indications that the [fraud] activity goes back to 2009."

The FBI started investigating in 2017.

The charge of wire or bank fraud carries with it up to 20 years in jail. Lelling did not rule out more charges.