The US Attorney's office
allowed two guilty plea agreements to weave a sinister tale last week about an
alleged "fundraising strategy" supposedly headed by Governor Rod
Blagojevich.
The alleged
"strategy" was designed to strong-arm firms seeking business with the
Teachers Retirement System and other state boards into hiring do-nothing
consultants who would then kick money back to the governor's campaign fund.
The actual allegations of
the "fundraising strategy" were made by two people who pled guilty to
various federal charges. However, by including their striking statements in the
plea agreements - some of which didn't seem necessary - the feds appeared to be
going out of their way to point a bright, flashing neon arrow right at Governor
Rod Blagojevich and his two top fundraisers, Chris Kelly and Tony Rezko.
Joe Cari's plea agreement
is the more interesting of the two. Cari, a one-time finance chairman of the
Democratic National Committee, claimed in the plea agreement that the infamous
Stuart Levine told him:
"...that a high
ranking Illinois public official ("Public Official A"), acting
through two close associates, was selecting consultants for the private equity
funds that appeared before the State Pension Funds. Levine said that this was
part of a fundraising strategy."
Several media reports and
independent sources say that Governor Rod Blagojevich is "Public Official
A." The official's "two close associates" have been identified
in media reports and by sources as Tony Rezko and Chris Kelly - the governor's
top fundraisers and advisors.
"Levine said that
Public Official A, and his associates, were going to pick law firms, investment
banking firms, and consultants that would help Public Official A."
Levine was a longtime
member of the Teachers Retirement System (TRS) board and has also been
implicated in similar shenanigans at the Illinois Health Facilities Planning
Board. He was reappointed to both boards by Blagojevich. Perhaps not
coincidentally, lots of the governor's pals signed on as hospital
representatives after Blagojevich was sworn in.
What was the reason for
hiring the consultants?
"Levine told Cari
that consultants selected by Levine and those associates would subsequently be
required to make certain political or charitable contributions as directed by
Levine and those associates."
Cari was allegedly told by
Levine to make sure that an investment company identified as "Firm 4"
hire one of Public Official A's guys as a consultant or he and the Teachers
Retirement System board would reject an $85 million investment with the firm.
"Cari talked to the
general counsel for Firm 4. Cari said that Firm 4 had to sign the contract, or
Firm 4's application for funds would get pulled off the TRS agenda. Cari said
that it was political and this was how Public Official A handled
patronage."
The governor's office
claims that the allegations shouldn't be believed because they're being made by
"convicted extortionist" Cari and twice-indicted extortionist Levin.
I could buy into the
proposition that Levine misrepresented his connections with the governor's
team. Here is what Levine allegedly told Cari:
"It was Cari's
understanding that if Levine did not want something to be approved by the TRS
Board, it would not be approved. Levine had previously told Cari that he had
the ability to control what would be on the TRS agenda."
The feds don't mention
this in the plea agreements, but it turns out that "Firm 4" ended up
getting its $85 million investment with TRS when another board member
intervened on its behalf. The firm never had to hire the consultant. So, Levine
apparently vastly inflated his importance on the board. Since he allegedly lied
about that, he may have also lied about the Blagojevich team's so-called
"fundraising strategy."
On the other hand, Cari
told prosecutors and Firm 4 that he had been through this sort of thing before
with Public Official A:
"Cari said that his
private equity firm had agreed to hire a consultant in order to get funding
from another State board."
Interestingly enough, back
when George Ryan was labeled "Official A" in an indictment of
somebody else, it wasn't completely clear at the time that the official was
actually Ryan. This time around, the feds left no doubt.
I'm not totally sold on
the governor's involvement. But the feds seem to know more than they're letting
on.
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Rich Miller also publishes
Capitol Fax, a daily political newsletter. He can be reached at
capitolfax.blogspot.com.