Place the flour in a shallow dish and coat the chicken pieces, shaking off any excess. Heat the oil in a large saucepot over medium-high heat.
Add the chicken in batches and fry until golden brown on all sides. When all the chicken has been cooked, set it aside. Add the garlic to the pan and cook until it turns golden brown. Add the mushrooms and saute for 5 to 7 minutes, until they release most of their liquid. Add the onion and bell peppers and saute until the vegetables are soft, approximately 6 minutes.
Add the wine and let reduce for about 1 minute. Add the chicken broth, tomatoes, crushed red pepper, salt oregano and tomato paste. Return the chicken to the pot and bring the liquid to a boil, stirring constantly. Turn down the heat and simmer for 30 to 45 minutes. Stir in the fresh basil just before serving.
This dish goes well with any pasta or rice and tastes even better the following day.