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FEATURE What, Me Worry? For Teflon Pete, a Dallas divorce case is a political problem BY ALLEN PUSEY Congressman Pete Sessions photo by Bill Clark 0 n the first day of September last year, Congressman Pete Sessions was in a place no congressman would want to be: sitting in a conference room with a pack of divorce lawyers, describing how a longtime friend and campaign contributor shuffled assets while trying to avoid a $1.4 million judgment in a stock fraud case. The Dallas Republican’s friend and donor-69-year-old Ahron Katzhad begun transferring assets to his wife Lucia shortly after the judgment. The transfers were done, Sessions knew, with the understanding that when the legal storm blew over, she would give them back. When the fraud case was settled 10 months later, Lucia Katz thanked her husband for his generous gifts of real estate, cash, and securities, and decided it would be bad manners to return them. When the marriage ended up in a Collin County divorce court, the congressman found himself in the odd position of providing testimony about his knowledge of the transferred assets. First, in a sworn affidavit, Sessions recounted a telephone conversation in which the Katzes described their scheme to him: “The intent expressed to me was that both understood that it was clearly never intended by Ahron to gift this property to Lucia and Lucia clearly understood thisf Later, in the September deposition, Sessions reiterated that the whole arrangement had been a ploy to fend off the creditors: “I think they were trying to find a way to hide and move those assets,” the congressman said under oath. The Katz divorce case is still not settled, and time will tell 10 THE TEXAS OBSERVER APRIL 20, 2007