Senator Is Indicted on Felony Charges : Congress: Sen. Dave Durenberger (R-Minn.) is accused of bilking the government into reimbursing him for stays in his own condominium.

Sen. Dave Durenberger (R-Minn.) was indicted Friday on federal felony charges that he falsified expense accounts to obtain government reimbursement for nights spent at his condominium in Minneapolis.

Durenberger, 58, denied the charges, which make him the first senator to be indicted in more than a decade.

“These allegations are completely false,” he said. “I have not engaged in criminal conduct. . . . I don’t intend to resign.”

Durenberger was reprimanded almost three years ago by his colleagues in the Senate for “reprehensible” financial dealings.

The indictment charges that the senator and his associates “did knowingly and intentionally conspire . . . to commit an offense against the United States” by hiding his ownership of the condominium. The indictment also names Durenberger’s lawyer, Michael C. Mahoney of Minneapolis, and his adviser, Paul P. Overgaard of Albert Lea, Minn., as defendants.

If found guilty, Durenberger, who has been in the Senate for 14 years, could face a maximum of 10 years in prison and fines of $500,000. The two other men could each face 20 years in prison and $1-million fines.

The indictment charged that, beginning in 1983, Durenberger, Mahoney and others devised a way to shift the cost of the condominium to the taxpayers by creating a partnership that “falsely made it appear that (Durenberger) had no interest in the property,” and then billing the Senate through his expense account for the nights he stayed there.

Senators are legally entitled to recover some of their travel costs and certain hotel or other legitimate lodging expenses, even for visits to the states they represent.

Even though the partnership dissolved in 1986 and the deed to the condominium was transferred back to Durenberger, he submitted fraudulent reimbursement vouchers of about $3,825 for stays at the condominium in 1987, when he was the sole owner of the property, according to the indictment.

Then he sold the property to Overgaard’s company with the agreement that he could buy it back at the same price, the indictment said.

“This effectively allowed defendant Durenberger to . . . shift the cost of the unit to the Senate by means of vouchers totaling over $20,000 for the period of April, 1987, through December, 1989,” the indictment said.

To cover the $3,825 in reimbursements that he claimed while his name was on the deed in 1987, Durenberger arranged to have documents backdated to make it appear that he sold the condominium to Overgaard sooner than he did, the indictment said.

In a “totally confidential,” handwritten note to the senator on Sept. 8, 1989, Overgaard wrote: “The last thing I need is to get involved in your ethics investigation and be accused of participating in a sham transaction by which you collect per diem . . . on a residence you actually own,” court documents showed.

But Durenberger said the indictment is not about “justice” but “about the unfettered ambition of bureaucrats who have spent millions of taxpayer dollars to find a nonexistent needle in the haystack of facts surrounding this case.”

Durenberger said Justice Department officials approached him before announcing the indictment and said they would refrain from charging his associates if he would plead guilty to misdemeanor charges.

“I’ve ruled out pleading to anything they’ve offered me,” Durenberger told reporters. Justice Department officials said they would not comment on whether such an offer had been made.

The Justice Department has been investigating Durenberger since 1990, when the Senate denounced him for ethics violations involving financial dealings. He was found to have circumvented rules on honorariums, padded his expense account, accepted prohibited gifts from lobbyists and converted a campaign contribution to his personal use.

At the time, Durenberger said he was sorry for “serious mistakes,” but on Friday, he pointed to the findings of the Senate Ethics Committee as proof of his innocence.

“Three years ago, the special counsel, the Ethics Committee and the Senate concluded that I never intended to break the law--that I had no criminal intent,” he said.

In 1990, Durenberger agreed to make restitution of $123,000. On Friday, he said he was still in the process of making payments.

Durenberger is the first senator to be indicted since 1980, when Sen. Harrison Williams, a New Jersey Democrat, was indicted and later convicted in the so-called Abscam scandal. Williams resigned in the face of certain expulsion.