Bush ally indicted over campaign fraud charge

Mr DeLay, 58, who is known as "the Hammer" on Capitol Hill because of his take-no-prisoners political style, is accused along with two Texas associates of operating a scheme to channel corporate money into the campaign to win control of the Texas legislature in 2002 ­ something that is illegal in the state.

Mr DeLay has all along denied wrongdoing, and claims he is victim of a witch-hunt by a politically motivated prosecutor.

"I am innocent," DeLay said after the charge was announced, describing the prosecutor, Ronnie Earle, as "an unabashed partisan zealot", and "a fanatic".

Nonetheless the charge, even if largely expected, is a massive blow for the Republican establishment in Washington DC. It comes as President George Bush is going through the rockiest period of his presidency, and ethics charges are swirling around other top party figures.

Mr DeLay has long been a figure of bitter controversy. Democrats have never forgiven him for the redistricting scheme he pushed through under questionable circumstances in his home state in 2003, sending an extra six Republican congressmen to Washington and cementing his party's grip on the House.

Since he rose to the number two position behind the House Speaker, Dennis Hastert, he has kept the tightest control of the Republican caucus, often stretching rules to the breaking point to secure Mr Bush's agenda. Last night a shaken White House said it continued to consider Mr DeLay "a good ally and friend". Further tarnishing Mr DeLay's reputation are his connections with the Republican lobbyist Jack Abramoff, himself indicted for fraud, and under congressional investigation for charging Indian tribes more than $60m (£34m) in fees, and persuading them to fund jaunts by congressmen ­ including Mr DeLay.