DC City Council Chair resigns over bank fraud charge

WASHINGTON Wed Jun 6, 2012 11:34pm EDT

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WASHINGTON (Reuters) - Washington's City Council chairman resigned on Wednesday over a federal charge that he knowingly overstated his income on bank loan applications, worsening turmoil that has marked local politics in the capital this year.

Kwame Brown, 41, the No. 2 city official after Mayor Vincent Gray, became the second sitting council member to step down since January over financial issues. Harry Thomas pleaded guilty to stealing city funds and was sentenced to prison in May.

A rising star in local politics dominated thoroughly by Democrats, Brown was elected to the City Council in 2004 and served as its chairman for the past year.

Brown said in his resignation letter that he chose to step down rather than allow his personal troubles to distract from the council's work.

"I have behaved in ways that I should not have. I was wrong, and I will face the consequences of that conduct," Brown said in the letter, the text of which was published by the Washington Post.

A charging document filed in federal court by U.S. Attorney Ronald Machen alleged a single bank fraud count. It alleged that Brown falsified documents in 2005 by overstating his income by tens of thousands of dollars on applications for a home equity loan and financing for a boat.

Brown said earlier this week he had no plans to resign. He did not comment to reporters when leaving his office on Wednesday.

Mary Cheh, acting chairman of the 12-member council until an interim replacement is elected next week at a special session, said in a statement late on Wednesday night that the chamber's work will continue uninterrupted.

"We will move forward focused on the business the people elected us to do," Cheh said.

(Reporting by John Crawley; Editing by Eric Walsh)

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