The charges against Rep. Faafetai Iaulualo stem from 2008, the last of four years he was director of the U.S. territory’s Department of Human and Social Services.

Iaulualo approved three paychecks for a department employee, co-defendant Aualuma Pese, who wasn’t entitled to the money, prosecutors said. Pese was charged with receiving stolen property.

Pese, the wife of Lefiti Pese, director of the territory’s Department of Agriculture, was accused of getting $7,651 without working or having adequate leave.

In exchange for approving illegal payroll forms, Iaulualo received assistance in his 2008 election campaign, according to court documents. He is running for re-election in November.

Defense attorneys haven’t responded to inquiries for comments.

Iaulualo and Pese appeared Thursday in District Court for their initial appearance. Iaulualo’s bail was cut in half to $20,000, and bail for Pese was reduced to $2,500 from $10,000.

It was revealed during the brief court hearing that Pese is a cancer patient, and she was released on $2,500 unsecured bond.

When first interviewed by investigators in December 2008, Iaulualo claimed Pese was paid because of "administrative errors" by his staff, but when he was reinterviewed in April last year, he admitted that "he was involved and that what he did was illegal," according to a court affidavit.

If convicted of all charges, Iaulualo could be sentenced to up to 26 years in prison. The charge against Pese is punishable by up to seven years in prison.