BOSTON — State Rep. Dave Nangle shuffled out of a federal courtroom in handcuffs on Tuesday, ankle shackles clinking between his dress shoes, following his arraignment on more than two dozen charges, including the alleged use of campaign funds for personal expenses.
Hours after he was arrested at his Belvidere home by agents from the Federal Bureau of Investigation and the Internal Revenue Service Criminal Investigation Division, Nangle pleaded not guilty to 10 counts of wire fraud, four counts of bank fraud, nine counts of making false statements to a bank and five counts of filing false tax returns.
The federal indictment outlined during a press conference by U.S. Attorney Andrew Lelling’s office alleges the 59-year-old state representative undertook a number of illegal schemes to fund a lifestyle beyond his means and cover up gambling debts.
“This was not a momentary lapse of judgment or a technical foul,” Lelling said. “This was a systematic pattern of theft and fraud going back to at least 2014. Nangle accomplished it in part using people close to him.”
Magistrate Judge Page Kelley ordered Nangle, also a former House Ethics Committee chairman, to be released on a $25,000 unsecured bond with several conditions.
The Lowell Democrat is barred from gambling while on pretrial release. He is also forbidden from traveling outside Massachusetts, except for brief trips to Hampton, N.H., which his attorney said are necessary to care for his girlfriend’s dogs. Kelley ordered Nangle to turn over his passport within 48 hours.
His attorney, William Connolly, read off a written statement to reporters outside the courtroom.
“Dave Nangle is a good man who has proudly represented his district as a state representative,” Connolly said. “The charges against David are nothing more than allegations. We will fight these charges in court.”
He declined to comment further. When exiting the courthouse, Nangle, who was no longer handcuffed, did not respond to questions.
The investigation into Nangle was referred to the FBI by another agency in November 2017.
“After conducting dozens of interviews and reviewing thousands of documents we found that he engaged in an elaborate and deliberate attempt to hide his alleged illegal activity by providing false, misleading and incomplete information to his campaign committee, his bank, the IRS and the state Office of Campaign and Political Finance,” said Joseph Bonavolonta, special agent in charge of the FBI Boston Field Division, during the mid-morning press-conference.
“Time after time he allegedly used campaign funds to pay for personal expenses spending thousands of dollars on golf club fees, gas gift cards, hotels, restaurants, flowers and rental cars for trips to casinos, some of which he had already been reimbursed for by taxpayers,” Bonavolonta continued.
The indictment includes allegations that Nangle used his campaign committee’s debit card as well as gift cards to make thousands of dollars in personal purchases.
“Based on the indictment, as to Representative Nangle’s campaign funds, it appears that over the years he has stolen over $70,000 of those funds for personal use,” Lelling said. “Nangle spent that money using a debit card, but also tried to hide his misuse of funds by first buying gift cards purportedly for his staff and then using them for his own personal expenses.”
The listed expenses include dues at a local golf club, rental cars to travel to casinos, flowers for his girlfriend, gas, hotels and restaurants. The investigation found he also used these funds to defraud his bank and collect income he did not report to the IRS.
The indictment lists a number of expenses that were not accurately reported to the Office of Campaign Finance. For example a $1,520 expense listed in 2014 as “catering,” was actually membership dues, locker fees and assessments for a Lowell golf club, according to the document.
When seeking a home mortgage from Lowell Bank in 2015, Nangle allegedly lied on his application and blamed his bad credit on his ex-wife.
“As part of the home mortgage application, Nangle submitted a letter to the Lowell Bank dated February 26, 2015, that falsely blamed his bad credit on his ex-wife, claiming that he had loaned her money, which she did not pay back in a timely fashion, when, in truth and fact, Nangle had not loaned her any money, and in the months prior to the closing, Nangle had spent thousands of dollars at (casinos,)” according to the indictment.
Nangle gambled heavily at casinos in Connecticut, New Hampshire, Massachusetts and Rhode Island as well as online, according to the indictment.
For example, the indictment states: “In the late evening hours of May 2, 2018 to the early morning hours of May 3, 2018, Nangle won a $1,221 jackpot on a slot machine at CT Casino 2. CT casino 2 was required to report any winnings of over $1,200 to the IRS, including identifying the jackpot winner on an IRS form W-2G. Instead of truthfully reporting such winnings, defendant Nangle paid another individual to collect Nangle’s winnings so that Nangle could evade reporting this casino income to the IRS on form W-2G. This conduct was captured on CT Casino 2 video surveillance.”
The investigation also included probes into Nangle’s relationship with a number of unnamed area businesses.
According to the indictment, he owed money to some of these businesses, including a restaurant in Dracut owned by his relative, a restaurant in Salisbury owned by a friend and a restaurant in Lowell.
The investigation found a facilities maintenance company in Billerica paid Nangle $27,000 for real estate consulting services in late-2014 and early-2015. According to the indictment, Nangle had not provided these services at the time of the payment.
Nangle repeatedly used a contracting company based in Tyngsboro, which the investigation found Nangle did not pay. Instead the contractor was “awarded lucrative bids” for construction projects with state funding secured by Nangle, according to the indictment.
Another section of the indictment describes a man, only identified as “Lowell State Employee,” who Nangle allegedly helped find work. Prosecutors allege this man assisted Nangle in filing false federal income tax returns.
When asked if any other elected officials were probed in this investigation, Lelling said he could not comment.
“Well it’s not ongoing for Rep. Nangle, as to other elected representatives, I don’t know the answer to that,” he said.
The Sun reported that Nangle’s campaign finance reports showed an $8,700 payment to Boston law firm Donnelly, Conroy & Gelhaar, LLP, and that Nangle, when asked if he was under any state or federal investigation, said he “knew nothing about it.”
A Sun editor who went to Nangle’s home on Trull Lane, in Belvidere, early Tuesday was confronted by one of his staffers, Bob Spinney. Spinney was observed entering the front door of the ranch-style home with a black trash bag. Later in the day, Spinney was seen at the courthouse with Nangle.
Nangle, a Lowell Democrat, is a division chair in House Speaker Robert DeLeo’s leadership team.
He has served in the House since 1999 and represents portions of Lowell and Chelmsford.
The next court date in this case is March 19 at 10 a.m. in U.S. District Court in Boston. Nangle is not required to attend.
I recently had a customer apply for credit, and their commercial credit report was UGLY. They owe everyone, and they’re past due 90+ days. They have a few big orders pending with us and I feel they have been shut off everywhere else, which is why they are pushing so hard to get our orders shipped. I called the president of the company and told him we were opening his account COD so the orders pending would need to be paid prior to shipping them out. He blew up. He said he didn’t care about the information on the DNB report and it did not relate to them. Then he screamed at me, asking if we were going to send the materials. I am not interested in acquiring another slow paying account, so I need your thoughts.
Signed, Miffed in Michigan
Control freaks, abusers of credit, and manipulators of people don’t ever question themselves. They never ask themselves if the problem is actually them, and they always say the problem is someone else. Such is the life of the slow-paying/no-paying account.
Yes, Mr. Crappy Credit Report, it is completely everyone else’s fault that your credit payment history looks like a piece of Swiss cheese: full of holes and slightly smelly. In fact, the Secret Society of Credit Managers got together last week and selected your company as THE ONE we were going to target for the month to make your professional life a nightmare. It has nothing to do with your inability to pay your invoices in a timely fashion. You, as always, are an innocent my dear customer.
Let’s be real here: customers with negative or poor credit history ALWAYS know they have bad credit, but they always posture like it is brand new information, heard for the very first time. What? My credit is bad? No, who is reporting me that way? I want names, numbers, I dispute it. This is total BS! The list of objections goes on and on. One thing they do know, it is wrong, and you need to give them credit RIGHT NOW or they will take their business elsewhere (oh, the horror.)
Blowhards and bullies shout over the top of you and push their agenda because that’s what worked for them in the past. Their theory is “if you say it loud enough and angry enough with enough threats and forcefulness, it becomes true and others back down.”
Well, I like to throw caution to the wind and pet that kitty backwards. If you are going to come at me bro, don’t come empty-handed. You’re not the first guy to lose his stuffing at me. So, your credit report is junk. Ok, no problem. I will email you a copy and you can address it directly with the commercial credit bureau I pulled it from. Once you two have kissed and made up, I will pull a new one and if it is good, then welcome to the family!
In absence of that, let’s take a look at the trade references you listed on your credit application. I will personally call each and every one of them. Once I have made contact and have the information back, we can reevaluate. Just so we are on the same page, trade references are who you currently purchase like materials from. I do not want anyone you hire (so no sub-contractors, no contractors, no homeowners), no big box, no gas and sip, no personal testimonials.
How about some financials? I will take those. Show me what you have under the hood. Since this is a family publication, I cannot print what some of the reactions to those requests have been but most of you have pretty good imaginations and can fill in those blanks.
If someone truly believes their credit report is inaccurate, they have a normal conversation about it, in a normal tone. In this case the old adage, “the louder they are, the harder they fall” applies, so take heed.
With more than 30 years of credit management experience in the LBM industry, Thea Dudley consults with companies on a wide range of credit and financial management issues. Contact Thea at email@example.com.
Small credit mistakes, like paying off your credit card a few days late, aren’t a big deal.
You pay a small penalty or a bit of interest and carry on as before. A slip up like that won’t come back to haunt you the next time you apply for a mortgage.
Other mistakes though can have a significant impact, even if they seem relatively minor at the time. They can stay on your credit record for years and potentially cause you to not qualify for a mortgage or loan or have to pay a higher interest rate.
Here’s a list of five credit mistakes that you definitely want to avoid:
Ignoring your financial details.
Not being aware of what interest rates you are paying or when a temporary or “teaser” rate ends can be very costly. Carrying debt on certain accounts harms your credit score far more (credit cards) than others (lines of credit).
You need to have a clear picture of all debts that you owe, how much they are costing you and review regularly to make improvements if necessary.
Draining retirement funds to avoid bankruptcy.
While nobody wants to claim bankruptcy, sometimes it’s the right choice. RRSPs are generally exempt from bankruptcy proceedings (except for amounts deposited in the last 12 months in some provinces) and can be left there to help you rebuild on the other side of the bankruptcy proceedings.
Not checking your credit.
You can check your credit report easily and for free in Canada through Equifax and TransUnion. Checking regularly (at least once per year if not twice) will allow you to become aware of any credit issues or fraud sooner so that they can be dealt with.
Having something unexpected appear on a credit report is common for Canadians and it’s up to you to watch for them.
Co-Signing a loan.
While this might make sense on a rare occasion, it should be avoided most of the time and only be considered with extreme caution.
I realize that it can be hard for young people to buy their first home these days but if they can’t qualify on their own, they likely shouldn’t be going ahead. Not only will your co-signing reduce your own borrowing capacity, if the loan isn’t repaid it can be disastrous to your own finances.
Not carrying any credit at all.
With all the pitfalls of having access to credit, it is still a necessary evil for most people. If you elect to go without a credit card or any other credit vehicle, you won’t build up a credit score which means you won’t be able to qualify for a loan when you need one.
And don’t cancel your first credit card either. Longevity in your credit history is equally important!
Having bad credit isn’t permanent and your score can be improved over time. But like many things in life, doing so takes a little bit of time and effort. But it’s not that hard.
Just put a semi-annual reminder in your calendar to sit down and review your credit and request a report.
Ask most people where they would go for a loan, and the answer is usually their bank. But what about when the banks can’t – or won’t – lend?
The commercial disruption and consequent financial ramifications, first of the financial crisis and now more dramatically COVID-19, have challenged the banks’ primacy in the lending arena. As a direct result of the financial crisis in 2008, regulators sought to build up bank liquidity and limit leverage.
Basel III was introduced which required banks to maintain appropriate leverage ratios, sufficient levels of reserve capital and introduce countercyclical measures. These requirements are assessed on an annual basis and revised to minimise the risk of system-wide shocks and prevent future economic collapses.
What did this mean for borrowers? Loans were more difficult to secure, requirements on collateral became stricter and other terms and conditions became more restrictive.
Hit from all sides
In 2020, Basel III ratios for banks were revised upwards again (meaning more capital was required against risk-weighted assets), COVID-19 was announced a pandemic by the WHO and global financial markets crashed. Consequently, banks have been driven into preservation mode as they wrestle with lower profits due to the introduction of interest rate cuts and higher cost of risk with a deterioration in asset quality.
In addition, most commercial banks across the Gulf have rationalized their balance-sheets to focus on assets deemed safer based on the sector, business model and the maturity stage. As such, there has been an increase in lending to government/government-related entities and large-cap corporates, thus reinforcing the challenge of accessing finance from banks for many small, medium and mid-cap businesses.
Developers left with little
The real estate sector is a prime example of where we are seeing a significant liquidity issue, as banks shy away from financing any except government-backed assets. Developers are unable to unlock funds as usual from their existing projects to recycle into new ones.
The bond way
The second port of call is usually debt capital markets, i.e. issuance of bonds or sukuks which can be listed and/or traded over the counter. There are many advantages for companies to raise a bond, including more flexible terms and non-amortising structures. That said, it is a long process, with an operating history of three years preferred. Ratings are required and financial information about the company must be disclosed publicly.
Specialist advisors and investment banks assist companies in issuing bonds, but it is a long process and is subject to investor demand at the time of issuance.
So where do businesses turn now? Step forward alternative finance. Simply put, it enables businesses to access quick, efficient, and flexible private debt from a source outside the traditional banking and capital market structures.
What is stopping businesses from taking advantage of such attractions? Misperceptions remain, with many business owners mistakenly viewing it as more expensive. And many view it as riskier and only for ‘bad credit’.
In fact, alternative finance providers are typically well-established financial institutions with the ability to quickly assess an opportunity, consider individual requirements of borrowers, and provide a bespoke solution that gives borrowers the flexibility they need while still protecting the interests of the lender.
These advantages enable businesses to access capital often far more quickly than via traditional methods and without some of the restrictive requirements, including tailored covenants and non-amortizing structures.
A deal which Shuaa completed in Dubai’s hospitality sector is a case in point. With a project already 85 per cent complete, the developer needed further funding – which the senior lender was unwilling to provide.
Getting a project to ready status
Due to leverage covenants, the developer was unable to raise debt from other sources, and because the asset was under construction the developer was unable to raise equity at an acceptable valuation. Shuaa was able to fulfil the complex requirements of the transaction through a preferred equity instrument, with a minimum return payable at maturity, thus allowing the project to complete without any impact on their existing bank facilities and no dilution for shareholders.
The hotel commenced operations shortly after our investment, and the owners were able to refinance the entire capital structure, repaid the existing debt, redeemed the preferred equity and released some cash to the shareholders.
So, businesses can find that alternative finance in fact represents an ideal funding instrument: quick and more flexible than bank debt without the complications of issuing a bond. Meanwhile, for investors, it offers the potential to participate in interesting business opportunities at a lower point on the risk curve than equity with attractive returns.
All of which makes the “alternative” a viable and appealing option. As the youngest and now third largest asset class in the private capital universe, global private debt assets under management (AUM) have consistently grown and expected to reach 41 trillion by 2021. The alternative is playing an increasingly important role on the global stage to cater to an ever changing environment.
The expectation is that the trend will continue, particularly in markets such as the GCC.
– Natasha Hannoun is Head of Investment Solutions at Shuaa Capital.