Mayor Soderquist, 44, and his wife, Deborah, are accused of stealing thousands of dollars from a campaign finance account and taking money from the Lake Station Food Pantry, which is funded by state tax dollars.
A federal grand jury indicted the Soderquists on Wednesday. According to the indictments, they lost more than $100,000 at Indiana and Michigan casinos between the spring of 2010 and December 2012, after allegedly taking the cash.
Federal agents searched Lake Station City Hall looking for evidence last fall. Defense attorney Scott King said the mayor and his wife, who is also his adminitrative assistant, have been cooperating with federal agents for more than a year.
Miranda Brakley, the mayor's step-daughter, was charged in a separate indictment with allegedly filing false bankruptcy papers and stealing bond money while working at the city courthouse.
All three appeared before a judge in a U.S. District Court in Hammond for arraignment on Thursday. The politician and his family said they did nothing wrong.
"Our analysis of what they're basing this on is, they're wrong," King said. "With respect to the allegations of fraud and income tax evasion, they are looking at funds that they legitimately received ? legally received ? not as compensation, but reimbursement for out of pocket expenses during the course of their campaign."
Some food pantry clients said word of the mayor's legal troubles prompted the Food Bank of Northwest Indiana to take back its food donation. The organization refused to comment.
"It's not hurting the mayor. It's hurting the people of Lake Station," Lake Station resident Debbie Goodman said. "This was supposed to have been donated. This wasn't bought. There's no money it in. It's donated. How can you take away something donated?"
Other food pantry clients were shocked by the news, but still supportive of Soderquist, who was first elected mayor of Lake Station in 2008 and re-elected in 2012.
"I'm shocked to hear about it," resident Glen Wells said. "He's done so much for the town. He's improved a lot of things for us."
All three were released on bond Thursday.