The Associated Press

Monday, November 15, 2010; 6:46 PM

http://www.washingtonpost.com/wp-dyn/content/article/2010/11/15/AR2010111500301.html

AUSTIN, Texas -- Seven candidates who prosecutors allege benefited from a money swap arranged by Tom DeLay's political action committee in 2002 got substantially higher donations from the Republican National Committee than most other Texas candidates did that year, a GOP official testified Monday at DeLay's money laundering trial.

But Jay Banning, with the National Republican Senatorial Committee, told jurors that none of the seven Texas candidates received any corporate money, despite what prosecutors allege.

Prosecutors say DeLay and two associates - John Colyandro and Jim Ellis - illegally channeled $190,000 in corporate donations collected by DeLay's PAC in Texas through an arm of the Washington-based Republican National Committee, or RNC. Under Texas law, corporate money cannot go directly to political campaigns.

Prosecutors allege the money, which was sent by the RNC to seven candidates chosen by the PAC, helped Republicans take control of the Texas House in 2002. That majority allowed the GOP to push through a DeLay-engineered congressional redistricting plan that sent more Texas Republicans to Congress in 2004 and strengthened DeLay's political power, prosecutors said.

DeLay, who has denied wrongdoing, maintains that the money swap at the center of the case was legal, no corporate money went to Texas candidates, and he had little involvement in how the PAC was run.

Prosecutors said they planned to wrap up their case on Tuesday. The trial is in its third week.

Banning, testifying on behalf of DeLay, was the RNC's chief financial officer in 2002. He was one of the GOP officials who signed off on the money swap.

Banning said any corporate money the RNC received was kept separate from funds collected from individual donations, the only type of money that could go to Texas candidates.

"The bottom line is the money that came to these Texas candidates was not the same $190,000 that" DeLay's PAC sent to the Republican National Committee, asked Dick DeGuerin, DeLay's lead attorney.

"That's correct," replied Banning, who testified before the prosecution has finished its case because of a scheduling conflict that would have prevented him from appearing later.

But when questioned by prosecutors, Banning told jurors the only RNC contributions above $500 that came to Texas candidates in 2002 went to the seven candidates in the money swap. The seven candidates got donations ranging from $20,000 to $40,000.

The only others who got similar or much higher donations in 2002 were Texas candidates in the races for governor, attorney general and the state supreme court, Banning said.

While questioning Banning, prosecutor Beverly Mathews compared the money swap to a drug dealer laundering profits.

"If a drug dealer gave the Republican National Committee $100,000 of drug money and asked the Republican National Committee to put it into a different account ... could the RNC put the money into a different account and turn around and send that money back to Texas candidates?" Mathews asked.

Earlier Monday, an accountant for DeLay's PAC told jurors the political group was running low on money from individual donors. Other PAC workers have also given similar testimony.

DeLay's attorneys have said the charges against him were politically motivated, which prosecutors deny.

The criminal charges in Texas, as well as a separate federal investigation of DeLay's ties to disgraced former lobbyist Jack Abramoff, ended his 22-year political career representing suburban Houston. The Justice Department probe into DeLay's ties to Abramoff ended without any charges filed against DeLay.

Ellis and Colyandro, who face lesser charges, will be tried later.

DeLay, whose nickname was "the Hammer" for his heavy-handed style, now runs a consulting firm based in the Houston suburb of Sugar Land. In 2009, he appeared on ABC's hit television show "Dancing With the Stars."