Chaka Fattah Jr., appeared in federal court in handcuffs Tuesday after surrendering to face an indictment on bank fraud charges.
"I believe this entire situation is politically motivated," said Fattah Jr., the son of Congressman Chaka Fattah, after posting $50,000 bail to be released before trial. "If my dad wasn't a congressman, nobody would be going after me."
But prosecutor Paul Gray said Fattah misrepresented himself in loan applications for his business and used the funds for "personal expenditures -- credit cards, cars, dinners," and to pay $33,000 in gambling debts.
Fattah denied using a loan to pay a gambling debt.
"I owned my business and I'm the sole shareholder, so if money moves out of my business into my personal account ... it's income," he said.
Fattah consulted for Delaware Valley High School (DVHS) until the IRS raided his home two years ago.
He filed a lawsuit this spring against the IRS for damaging his reputation and losing him his job by, he claimed in an interview with Metro, leaking information about the raid to news media.
Gray said the charges were not related to that lawsuit.
"We searched Mr. Fattah's home and business two years ago and evidence from that is included in this indictment," Gray said. "The lawsuit had nothing to do with anything."
Fattah Jr., as president of 259 Consulting, worked with DVHS, a for-profit education firm that ran multiple schools.
The indictment says DVHS overbilled the School District while running schools for struggling students and kids with disciplinary problems.
Gray acknowledged DVHS did provide some services for its fees.
"Delaware Valley High School did have a contract with the school district and did
perform services at the Southwest school," Gray said. "The indictment merely alleges that the School District was lied to about how much money Delaware Valley spent to provide those services, those were exaggerated and funds were stolen from the school district -- but services were provided."