Indictment offers a look at Giuliani's inner circle

According to the indictment, Kerik and seven co-conspirators sought to profit from his political position. While he was corrections commissioner and police commissioner, it asserted, Kerik met with New York and New Jersey regulators on behalf of Interstate Industrial Corp., which was seeking government contracts. City and state agencies at the time were investigating whether the company had purged itself of earlier ties to organized crime.

In return for Kerik's support, the indictment said, the New Jersey company paid for more than $250,000 in improvements to his apartment in the Bronx. Among the renovations were new bathrooms with a Jacuzzi, the marble entrance and a new kitchen.

The indictment said Kerik concealed this income -- as well as rent payments a New York real estate developer made on an Upper East Side apartment -- from the IRS.

Kerik's fame led to a contract to write a book and, according to the indictment, he failed to report more than $75,000 in income from that project.

The indictment also said he accepted a personal loan from a Brooklyn businessman, with the knowledge that the money came from a wealthy Israeli industrialist whose companies did business with the federal government. The indictment did not identify either loan source by name.

Before his nomination as Homeland Security chief, Kerik held a position as senior policy advisor to the Coalition Provisional Authority, which governed Iraq after the 2003 American invasion. There, he led the effort to establish a police force in Iraq.

The indictment accused Kerik of making false statements in applying for each of those positions. He lied to three different White House officials about his tax and financial histories, according to the indictment, which does not identify the officials.

"Time and again Kerik was asked specific questions about his financial dealings, and time and again he lied," U.S. Atty. Michael J. Garcia told reporters Friday.

Kerik already has resolved charges against him in state court. He pleaded guilty to misdemeanors related to the Bronx apartment renovations last year.

But Kerik's stated determination to contest the federal charges ensures that the matter will remain a campaign issue. A trial could come sometime next year -- during the heart of the general election campaign.

Paul D'Emilia, a Kerik friend who administers a legal defense fund to pay the former police chief's bills, said Friday: "He's definitely going to fight."

joe.mathews@latimes.com

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Times staff writer Peter Nicholas contributed to this report.