Senator indicted in fraud case

Derrick Shepherd, once considered a rising political star who won three elections and basked in the glory of his military service, was indicted Thursday for allegedly helping a woman who orchestrated an illegal scheme to launder $2 million for her construction bond business.

A grand jury returned a 41-count superseding indictment in the U.S. District Court, Eastern District of Louisiana that charged Shepherd, a Democratic state senator from Marrero, alongside convicted bond broker Gwendolyn Joseph Moyo; her accused "straw man," James Zoucha; and two Nevada corporations she used to do business after being prohibited from writing construction bonds.

Shepherd is charged with three criminal counts of mail fraud, one count of conspiracy to commit mail and wire fraud, and one count of conspiracy to commit money laundering. If convicted on all counts, he faces a maximum of 85 years in prison, but legal observers predicted that he realistically faces closer to six years.

Even though the allegations pertain only to Shepherd's private law office, U.S. Attorney Jim Letten and FBI Special Agent in Charge James Bernazzani described the indictment as another blow to public corruption in Louisiana.

Reached by phone after the grand jury issued the indictment, Shepherd said: "I don't want to talk." He maintained his innocence in a written statement released by a spokesman.

"I have never knowingly or maliciously violated any law -- parish, state or federal -- and I am absolutely not guilty of any criminal offenses," he said in the statement. "It is clear now that my last hope for exoneration lies with our jury system."

In October, Shepherd blamed the investigation on retaliation by FBI agents who wanted him to divulge incriminating evidence against other public officials. Asked to respond to the claim Thursday, Letten said his office operates free from "personal rancor or anger or retribution."

"I will not respond to allegations and the lamentations and whining of people who have been charged with crimes out there," Letten said.

Dozens of transactions

The prosecution's case centers around Moyo, who was originally indicted in October but faces new charges in the superseding indictment. Federal prosecutors said Moyo was ordered in November 2006 to cease and desist from writing construction bonds because her 1989 and 1991 federal convictions in Arizona banned her from the business.

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