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WASHINGTON (WUSA9) -- New charges are on the way in the federal probe of Mayor Vincent Gray's 2010 campaign.

Sources close to the investigation are telling WUSA9 that US Attorney Ronald Machen is prepared to file charges against a major figure in the probe. Those charges could come as soon as a few days or next week according to people close to the case.

WUSA9 has learned Machen has been meeting with Brendan Sullivan, a noted defense attorney for Jeffrey Thompson. Thompson is the wealthy businessman who allegedly funneled $650,000 to an off-the-books shadow campaign for Vincent Gray in 2010 DC mayoral race. Calls to Sullivan's law office have not been returned.

"In 2010 the Mayoral Campaign was compromised by backroom deals, secret payments, and a flood of unreported cash," Machen said.

According to sources close to the campaign investigation,Machen and Sullivan have been trying to work out a plea agreement for Thompson. Sources say Sullivan has been arguing for misdemeanor pleas for his client. That move would prevent a prison sentence for Thompson.

WUSA9's sources say in several meetings with Thompson's defense team, prosecutors made clear their intent to file felony charges against the multi-millionaire and political fundraiser. Those charges would include conspiracy and fraud.

"The investigation into the 2010 election is continuing. No further comment," Bill Miller, spokesman for the US Attorney's office told WUSA9. So far Machen has not named Thompson as a major target of the 2010 campaign probe.

Four staffers from the Vincent Gray 2010 election campaign have already taken felony pleas:

Howard Brooks - former campaign aide
Thomas Gore - former deputy treasurer
Vernon Hawkins: one former field operations manager
Jeanne Harris: former communications representative.

In an exclusive with WUSA9's Bruce Johnson earlier this month, Mayor Gray apologized for their actions for the first time.
He continued to deny any knowledge of the $650,000 "Shadow" campaign in 2010.


"Nobody knew about it, Bruce. I mean I've talked to people in my campaign, my campaign manager who was there."

Gray also said he did not know about any questionable financial activity from Thompson.

"I don't know...I asked a lot of people, just like I'm doing now Bruce. I'm asking people to support my campaign. And when I initially asked [Thompson], because he's known to be a prolific fundraiser and supporter...he said that he couldn't support my campaign. That was his initial response. And then at a later stage, he said he would. Let me just say this, Jeff Thompson has never asked me for one thing."

The US Attorney has never accused Gray of wrongdoing. However, what isn't clear is if Machen has ended his focus on the mayor within the campaign investigation.

Mayor Gray is in the midst of a tough re-election campaign. Debbie Hines, a former prosecutor-turned defense attorney, tells WUSA9 the timing of the elections carries no weight with prosecutors:

"The prosecutor has no regard for the election, the timing of an election, when an election is going to occur, who's running in an election."

Bruce Johnson brings the latest report.

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