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Former Detroit mayor hit with fresh federal charges

DETROIT (Reuters) - A federal grand jury on Wednesday indicted former Detroit mayor Kwame Kilpatrick on new fraud and tax charges.

The indictment alleges Kilpatrick used a tax-exempt organization to give himself cash kickbacks, fund his campaigns, financially support friends and relatives and pay for everything from counter-surveillance and anti-bugging equipment to yoga and golf lessons.

The government alleges Kilpatrick received unreported taxable income of at least $640,000 as a result of the diversions but failed to declare it in his tax returns.

Last month, Kilpatrick, 40, was led out of court in handcuffs after being sentenced to up to five years in prison for violating the terms of his 2008 probation on convictions for perjury and obstruction of justice.

Under that 2008 plea deal, Kilpatrick resigned as Detroit mayor, spent four months in jail, agreed to pay $1 million to the city and surrendered his law license.

He also pleaded guilty to two felony charges stemming from his role in the city's $8.4 million settlement of a whistle-blower lawsuit brought by two fired police officers.

(Reporting by James B. Kelleher; editing by Todd Eastham)