Knoxville State Rep. Joe Armstrong, 58, was indicted Wednesday by a federal grand jury for using knowledge on a bill for which he voted to turn a $500,000 profit in a fraud and tax evasion scheme.
The indictment was filed in U.S. District Court and Rep. Armstrong is charged with conspiring to defraud the U.S., attempting to evade and defeat income taxes, and fraud and false statements.
The indictment says Rep. Armstrong was involved in the sale of state cigarette tax stamps, buying the stamps at one price and then selling them at a profit.
The indictment also alleges Rep. Armstrong then tried to hide the profits, "to avoid the assessment and payment of federal income taxes."
House Democratic Leader Craig Fitzhugh said, "Joe Armstrong and I have served together for over 20 years. In that time, I have never known him to be anything other than a dedicated public servant and an advocate for his community. We have a justice system in place to deal with these situations. I believe it is important to reserve our judgment until all the facts have come to light. Until then, my thoughts are with Joe and his family as this process moves forward.”