The mayor of Alabama's largest city, a player in a multibillion dollar sewer bond deal that drove the surrounding county to the brink of bankruptcy, was arrested on Monday on federal criminal charges, an FBI spokesman said.
Larry Langford was taken into custody around 7 a.m. Monday, spokesman Paul Daymond said. It wasn't immediately clear what charges Langford faces.
Authorities are planning to say more at a morning news conference.
Langford was president of the Jefferson County Commission before he was elected mayor last year. Birmingham is in Jefferson County.
He was accused in a Securities and Exchange Commission lawsuit of taking more than $156,000 from a friend whose firm made millions on risky bond transactions with the county for a new sewer system.
Those bonds went sour as the housing market plunged this year and credit costs skyrocketed and have pushed the state's largest county to the brink of bankruptcy.
The county is trying to avoid filing what would be the largest municipal bankruptcy in U.S. history over $3.2 billion in bond debt, nearly double the record of $1.7 billion set in 1994 by Orange County, Calif.
The SEC accused Langford of taking the undisclosed payments and benefits from Montgomery investment banker Bill Blount, whose firm collected more than $6.7 million in fees on county bond transactions. The money was allegedly routed through Al LaPierre, a lobbyist who is a friend of Langford.
Langford, Blount and LaPierre have denied any wrongdoing and asked that the lawsuit be thrown out.
David McKnight, an attorney for Blount, said federal prosecutors told him that Blount would be charged, too, and Blount was on his way to Birmingham to surrender. McKnight said he was not given any details about the charges.
An attorney for LaPierre, Tommy Spina, told The Birmingham News that LaPierre would be surrendering later Monday. Spina did not immediately return a call for comment.
The mayor's chief of staff said city business would go on as usual. In a statement, Deborah Vance-Bowie also said the indictment of Langford was "certainly no surprise to us" and that they had expected some action from U.S. Attorney Alice Martin as she nears a possible end of her appointment with the swearing in of a new president in January.
"We are glad the mayor will finally have his day in court," the chief of staff's statement said.
Langford has said the investigation was politically motivated. He contends Martin, who was appointed by President Bush, has targeted Democrats.
Langford, who was elected mayor in a nonpartisan vote, was a Democrat when he served on the commission and identifies himself as a Democrat. Blount is a former state Democratic Party chairman and LaPierre is a former state Democratic Party executive director.
Martin has denied any political motivation behind her office's investigations and prosecutions.
Langford, 60, has drawn attention for a series of colorful stunts since taking office last year, many of which are aimed at trying to turn around an old steel city-turned-medical hub.
He walked into a business meeting with two police officers carrying submachine guns, props meant to generate interest in his "top secret" finance plans. He also announced a longshot bid to bring the 2020 Olympics to Birmingham, and his critics have even gone as far as to call him "Mayor LaLa."
The former promoter and television reporter has been unapologetic about his conduct, saying it's his job to sell the city.