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Fattah's finances under microscope as prosecutors' case nears end

Drawing toward the end of their case against U.S. Rep. Chaka Fattah, federal prosecutors focused Thursday on tracing the congressman's financial transactions - including an instance when they alleged he paid his city wage taxes with money received as a bribe.

Drawing toward the end of their case against U.S. Rep. Chaka Fattah, federal prosecutors focused Thursday on tracing the congressman's financial transactions - including an instance when they alleged he paid his city wage taxes with money received as a bribe.

But lawyers for Fattah and his four codefendants argued that investigators had jumped to the wrong conclusions in their eagerness to connect the dots of their case.

"You can't say, can you, that that is the same cash?" asked Robert Welsh, attorney for political fund-raiser Herbert Vederman, as he questioned FBI forensic accountant Rene Michael about one alleged bribery scheme.

Prosecutors had accused Vederman, a wealthy Fattah family friend, of funneling bribe money to the congressman in 2010 through a check written to his son, Chaka "Chip" Fattah Jr.

In April of that year, Vederman cut a $3,500 check to the younger Fattah, who cashed it and immediately deposited $2,310 into his father's checking account. Within hours of that transaction, the congressman paid off his city wage-tax bill of $2,381.

Welsh balked at the suggestion that the payment to Fattah Jr. had anything to do with the congressman's wage-tax payment.

He told jurors during his opening statement last month that Fattah had asked Vederman to help out his son, who had a gambling problem.

The younger Fattah is serving a five-year prison sentence on bank and tax fraud charges unrelated to his father's case. During his trial last year, jurors heard audio recordings in which he bragged to a friend that he often provided "fat stacks" of cash to his father when the congressman needed money.

"Mr. Vederman was not giving envelopes of cash," Welsh said Thursday.

Prosecutors contend that the wage-tax payment was just one in a series of gifts Vederman offered the congressman to buy his support in a bid to land an appointment from President Obama to an ambassadorship.

Other alleged bribes include $3,000 in college tuition payments for Fattah's South African au pair and $18,000 Vederman purportedly provided to cover the closing costs on a Poconos vacation home that the congressman and his wife, former NBC10 news anchor Renee Chenault-Fattah, bought in 2012.

When the mortgage company asked to see documentation explaining the source of the funds, prosecutors say, Fattah faked paperwork suggesting that Chenault-Fattah had sold Vederman her 1989 Porsche Carrera.

Defense lawyers Thursday argued that Vederman's Porsche purchase was legitimate and was intended to free up the Fattahs' own assets so they could purchase the $425,000 rustic stone house with wooded river views in Pike County.

Chenault-Fattah kept the car for years afterward and continued to insure it and pay its registration costs, FBI agents testified Wednesday. Her husband's lawyers have said she did so on their advice after it became clear that its sale had attracted the attention of federal investigators.

Victoria Souza, a compliance specialist who handled the Fattahs' mortgage, told jurors Thursday that the car-sale documents the congressman provided in 2012 were enough to satisfy her questions about the source of the $18,000.

Still, Assistant U.S. Attorney Eric Gibson noted, Souza's conclusions could rely only on the information Fattah provided.

"If there's garbage going into the system," he said, "then there's garbage coming out."

In addition to the alleged bribery scheme, Fattah and three others stand accused of misappropriating charitable donations, campaign contributions, and federal grant funds under their control to pay off the congressman's other personal and political debts.

They could begin their defense as early as Friday, when prosecutors are expected to rest their case.

jroebuck@phillynews.com

215-854-2608 @jeremyrroebuck