A former roommate of Chaka Fattah Jr. pleaded guilty in federal court Monday to a charge that he made false statements to obtain loans from three banks.
Standing before U.S. District Judge Harvey Bartle 3d, Matthew Amato, 31, of Broomall, pleaded guilty to making false statements to Wachovia Bank, PNC Bank and Sun National Bank in July and August 2005.
He faces a maximum sentence of 30 years in prison, a $250,000 fine, and five years' probation.
Assistant U.S. Attorney Paul L. Gray said Amato also agreed to cooperate with any investigation and prosecution related to the case, including testifying at the pending trial of Chaka Fattah Jr., son of U.S. Rep. Chaka Fattah, a Philadelphia Democrat.
Fattah, 31, also known as "Chip," was indicted in federal court last week, accused of stealing hundreds of thousands of dollars intended for Philadelphia schools. He also was accused of fraudulently obtaining about $200,000 in business loans. Prosecutors said he spent the money on gambling debts and other personal expenses.
The younger Fattah has denied the charges, calling the allegations "politically motivated."
"I have been successful in my business," he said last week. "I've earned every dollar legitimately, and I don't think this is the way an investigation is typically handled."
Fattah's father, a 10-term U.S. representative, said in a statement last week that he was confident his son would be cleared.
Gray said that in Amato's case, about $65,000 was diverted to "personal, nonbusiness purposes."
Amato and Fattah Jr. shared an apartment on Henry Avenue in Philadelphia in 2005 and 2006 and were roommates earlier at Drexel University, Gray said.
In court, wearing a gray business suit, Amato said he was a graduate of Temple University.
Gray said Amato has admitted that he was procured to go to the banks by Fattah Jr.
Amato falsely claimed to be the CEO and sole proprietor Chaka Fattah Jr. Associates, a consulting firm, prosecutors said, to gain commercial loans.
Gray said investigators found no evidence that such a company existed.
Gray said that after each line of credit was granted to Amato, he transferred or wrote checks to Chaka Fattah Jr. or to Fattah's education consulting firm, 259 Strategies.
Amato used a 2004 income tax return which Fattah had prepared for 259 Strategies, Gray said.
He said the income tax return Amato used indicated that 259 Strategies had earned about $140,000 in 2004.
"In fact, the company was not initiated until 2005. Banking records show there was no income in 2004," Gray said.
Amato's sentencing hearing was scheduled for Nov. 12.