David Hammer / Eyewitness News
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Paul Murphy / Eyewitness News
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NEW ORLEANS - Former New Orleans Mayor Ray Nagin failed to report hundreds of thousands of dollars in income for trips, meals, parties, free rent and cell phones provided by buddies and city taxpayers, with the taxpayer money used in the form of a city credit card, according to testimony in court Tuesday.

Nagin is on trial for federal corruption, and among the alleged schemes being laid out were the taking of bribes for his family business and gifts of family vacations, some given by people wanting city business, some being given by 'friends and associates' and some that Nagin lavished upon himself and his family using the city credit card. None of these were reported as income, according to IRS agent Tim Moore.

Moore, who drew laughter from those in the courtroom when he said that bribes were income and needed to be reported on federal tax forms, testified that Nagin claimed none of the $342,000 in gifts, bribes and improper credit card purchases that he racked up from 2005 to 2008.

In fact, in some cases, his unreported income exceeded his reported earnings, and that allowed him to collect huge tax refunds when he should have owed thousands.

In some particularly damning testimony, Moore said that Nagin booked some family travel with his personal credit card, then sought and received reimbursement from the city for about $3,400. But the documents he turned in to his own finance department had five items blocked out. The IRS discovered the five items were credits for those five travel charges because the Nagins had canceled the trips.

It was one thing for Nagin to charge taxpayers for travel and meals for his wife, daughter and two sons; it was another for him to hide the fact that he didn't actually pay for those five travel charges to get city money for it.

In addition, IRS records showed the Nagin family granite business, Stone Age, went out of business in 2009. As we previously reported, though, the Nagins a claim for losses from the BP oil spill, which didn't even happen until 2010.

Prior to Moore's testimony, former Nagin buddy David White, who along with Nagin owned part of the New Orleans Brass hockey franchise and later invested with Nagin in a casino in Mexico, stated that he helped supplement the former mayor's income to the tune of about $7,500 a month to help Nagin 'make ends meet.'

White made the payments to Nagin's wife Seletha, but White made it clear that it was Nagin who asked for the money.

Nagin was drawing a nearly $150,000 salary as the city's mayor at the time.

In all, White estimated he gave Nagin about $94.500 in 2004 and 2005.

There was also testimony about Nagin's use of city credit cards to rack up about $55,000 more than $1,000 a week in 2005 alone. Tens of thousands more followed in 2006, 2007 and 2008, charges that included travel for himself and family members, meals that cost over $300 a pop and clothing costs.

Earlier in the day, the testimony took a turn away from the alleged kickbacks and bribes that had made up most of the earlier testimony when a Texas homebuilder portrayed Ray Nagin as a freeloader who didn't pay rent on townhomes in Texas.

Rick Horton, a homebuilding business owner, testified he built the Nagins two townhomes in Frisco, Texas, after the mayor of Dallas approached him on Nagin's behalf. Court documents show one townhome was for sons Jeremy and Jarin and a grandmother; the other townhome was for Nagin, his wife Seletha and daughter Tianna.

Rent for each of the 1,700 square foot townhomes was $1,300-$1,500 per month, but Nagin never paid rent, according to Horton. Horton testified he thought Nagin would stay six months. Nagin ended up staying 18 months from 2005-2007. He tried multiple times to get Nagin to leave, and started asking Nagin to move out in October 2006. Horton said he wrote a second letter to Nagin to leave in January 2007.

Horton testified that not only he did buy $20,000 worth of furniture for the townhomes, but even paid for Nagin's DirecTV bill.

As Nagin was looking to purchase a townhome in May 2007, Horton testified that he told Nagin to close deal or get out of the townhomes he was providing. He told him to leave furniture he bought as well.

While Horton's testimony was not in the indictment explicitly, in addition to embarrassing Nagin, Horton's testimony may relate to Nagin's tax evasion charges.

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