It’s Official: Blago is ‘Public Official A’ Updated X1
1 comment February 26th, 2008
The wide-ranging federal probe of public corruption in state government creeped closer to Gov. Rod Blagojevich on Monday. Officially, that is, though not technically.
It’s been clear for months the feds were eyeing Blagojevich as a central character in their probe. But Blagojevich had previously been identified only by the pseudonym “Public Official A.” The feds did not identify him by name. On Monday, U.S. District Judge Amy St. Eve removed any doubt about the official’s identity. She identified the governor by name.
In a nine-page order pertaining to evidence the feds plan to offer in the upcoming corruption trial of Tony Rezko, a former top fundraiser and adviser for Blagojevich, St. Eve revealed that Blagojevich is one in the same as ”Public Official A.” News coverage is here, here, here, and here.
What exactly did the governor do wrong? First things first, the feds have not charged Blagojevich with a crime.
However, they have charged and/or are investigating a number of Blagojevich insiders. Next week, Rezko begins trial on charges that he used his insider clout to attempt to extort kickbacks from firms seeking business with the state. Blagojevich — previously as “Public Official A” and now by name — has repeatedly surfaced in pre-trial exchanges between the feds and Rezko’s defense team. The charges against Rezko are here and here.
In one instance detailed by the feds, Blagojevich’s campaign fund stood to gain a $1.5 million donation that Rezko and Stuart Levine, another insider cooperating with the feds, allegedly tried to extort from an investment firm. Thomas Rosenberg, also a Hollywood producer, represented that firm, which sought to invest assets held by the Illinois Teachers Retirement System. Rezko and Levine allegedly claimed they could steer investments in exchange for kickbacks.
From Judge St. Eve’s order:
In early 2004, the staff of the TRS Board had recommended that the Board allocate available funds for real estate investments among the existing TRS real estate managers, including a $220 million investment with Capri Capital. Through Levine’s arrangement, the TRS Board postponed the allocation to Capri Capital. Levine and Rezko allegedly then agreed to approach Rosenberg through an intermediary to either make a $1.5 million donation to Governor Blagojevich or pay Levine an approximate $2 million fee in order to obtain the $220 allocation. In approximately May 2004, that intermediary approached Rosenberg and informed him of Levine and Rezko’s demand. Rosenberg responded that he would not be extorted, and he thereafter threatened to inform law enforcement. Given the threat, Levine and others agreed that Capri Capital would receive the $220 million without any fees or political donations, but it would not receive any further business from the State of Illinois, including TRS. The TRS Board subsequently approved the $220 allocation to Capri Capital.
The feds alleged the same scheme in December, when they filed a document called a proffer setting forth their evidence against Rezko. The proffer used pseudonyms to describe Blagojevich and other officials:
Investment Firm 7 was a real estate investment management firm that had a long-standing relationship with TRS. In February 2004, Investment Firm 7 was supposed to receive $220 million from TRS to manage. Levine acted to stall the allocation, and planned with Rezko to approach Individual J, a principal of Investment Firm 7, with a choice: if Individual J wanted to get the $220 million for Investment Firm 7, he was either going to have to make a $1.5 million donation to Public Official A or pay Levine a 1 % fee (which would be shared with Rezko). Rezko and Levine enlisted Co-Schemer A’s help to demonstrate to Individual J that he needed Levine’s help to get the $220 million. In the course of Co-Schemer A’s efforts to prepare Individual J for Levine’s approach, Individual J realized that he was going to be extorted and threatened to expose the scheme. In light of this threat, Levine, Rezko, Co-Schemer B, and Co-Schemer A spoke on May 10 and decided that Individual J would get his $220 million without being asked for any contribution, but that Individual J would never again get any money from the state of Illinois. Investment Firm 7 did in fact receive a $220 million allocation at the May 2004 TRS Board meeting.
Rezko masterfully ingratiated himself with powerful Chicago pols. As you probably heard from national news coverage, Rezko also was a longtime supporter of Barack Obama, the community organizer turned state lawmaker turned U.S. senator turned presidential contender. More background on Rezko/Obama is here. For the identities of nearly all the characters in the upcoming Rezko trial, go here. (Separately, the feds have indicted Chris Kelly, another former top fundraiser and adviser for the governor.)
Blagojevich and his aides have steadfastly denied he is “Public Official A.” In December, when the feds described their evidence against Rezko in a document called a proffer, Blagojevich spokeswoman Abby Ottenhoff had this to say to the Associated Press:
“No such conversation ever occurred. This administration does not do business that way.”
Ottenhoff added:
“Based on the description in the filing, it is not the governor.”
Only, as the AP noted in its story at the time, the “description” in the proffer pointed directly at the governor — not away from him. In one scene, the proffer describes a plane ride to New York after “Public Official A” reappointed Levine to the Illinois Health Facilities Planning Board in the fall of 2003.
After Levine was reappointed, he shared a private plane ride from New York to Chicago with Public Official A and Co-Schemer B. Levine, Public Official A, and Co-Schemer B were the only passengers on the flight. At the beginning of the flight, Levine thanked Public Official A for reappointing him to the Planning Board. Public Official A responded that Levine should only talk with “Tony” [Rezko] or [Co-Schemer B] about the board, “but you stick with us and you will do very well for yourself.”
The fact is that Blagojevich reappointed Levine to the board. If you accept this fact, then “Public Official A” can’t be anybody other than Blagojevich.
Again, the feds have not charged Blagojevich with a crime. Moreover, the feds generally proceed upward in public corruption cases from lower-ranking players to the powers that be. They grab the little guys and squeeze until the little guys give up the big guys. Therefore, the direction of the probe likely will be affected by whether the feds win at trial against Rezko. The outcome of the case against Chris Kelly also may help determine whether the feds charge the governor.
Nonetheless, there is plenty of speculation about whether the governor’s indictment is imminent. Charlie Wheeler, a retired Chicago Sun-Times reporter who heads the public affairs reporting program at the University of Illinois at Springfield, recently analyzed the proffer and concluded that Blagojevich’s indictment “seems a certainty, based on what prosecutors say they will prove in the Rezko trial.”
That, Wheeler said, is the proffer’s “logical conclusion.”
UPDATE 1
The Cap Fax Blog notes the feds don’t have an open and shut case against Rezko. There may well be some holes.
