Ex-Virginia governor misrepresented loan, counsel testifies

RICHMOND Va. Tue Aug 5, 2014 8:17pm EDT

1 of 2. Former Virginia Governor Robert McDonnell arrives with his legal team for his trial in Richmond, Virginia, July 28, 2014.

Credit: Reuters/Jay Westcott

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RICHMOND Va. (Reuters) - Former Virginia Governor Robert McDonnell wrote on a 2011 financial form that he incurred a $50,000 debt for “medical services" when businessman Jonnie Williams actually loaned him the money, according to testimony on Tuesday at McDonnell’s corruption trial.

“Nothing indicates it's from Jonnie Williams,” Jasen Eige, the former chief counsel to the governor, said in U.S. District Court in a seventh day of testimony at the trial.

Williams, the prosecutors' star witness, completed four days of testimony on Monday by detailing financial help he said he had given McDonnell and his wife Maureen.

Testifying under immunity from prosecution, he said he gave $50,000 to the couple after the first lady told him the couple's credit cards were tapped out and resort rental properties were underwater, or worth less than the mortgages on them. McDonnell and his wife face 14 counts of corruption and bribery for allegedly accepting $165,000 in gifts and loans from Williams in exchange for supporting his former company, a dietary supplement maker now known as Rock Creek Pharmaceuticals.

Eige also testified that he knew nothing about the $50,000 loan, a $15,000 check from Williams to the McDonnells to pay for a wedding reception for their daughter or other gifts.

But the former chief counsel said he knew the McDonnells were in financial trouble because of a 2009 email that the first lady sent him after he rejected an offer by Williams offer to buy her an inauguration dress.

The email, flashed on television screen by prosecutors, read: “We are broke, have an unconscionable amount in credit card debt already, and this Inaugural is killing us!!

Earlier Tuesday, a top Virginia health adviser testified that she had discussed the benefits of the dietary supplement at the center of the trial with the first lady and Williams.

The aide, Molly Huffstetler, said that no action resulted from the August 2011 meeting about the supplement, Anatabloc. But she testified that William Hazel, Virginia’s secretary of health and human resources, told her to hold the meeting.

Lawyers for McDonnell and his wife have argued that accepting the gifts was unseemly but not illegal. Defense attorneys have tried to distance the former governor from Williams, saying the interaction was primarily between the businessman and Maureen McDonnell.

If convicted, the McDonnells could each face more than 20 years in prison and a large fine. McDonnell's four-year term as governor ended in January.

(Writing by Ian Simpson; Editing by Bill Trott and Eric Walsh)

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