For the first time, Democratic White House hopeful Barack Obama has surfaced in the federal corrupton case against his longtime campaign fund-raiser, Tony Rezko, the Chicago Sun-Times has learned.
The Illinois senator isn’t accused of any wrongdoing. And there’s no evidence Obama knew contributions to his 2004 U.S. Senate campaign came from schemes Rezko is accused of orchestrating.
The allegations against Rezko that involve Obama are contained in one paragraph of a 78-page document filed last month in which prosecutors outline their corruption and fraud case against Rezko, who was also a key money man for Gov. Blagojevich and other politicians.
Rezko is set to go to trial Feb. 25. The revelation that Obama’s name could come up in court is a political headache he doesn’t need as he heads into a round of primaries that are likely to determine his party’s nomination for president.
Obama is not named in the Dec. 21 court document. But a source familiar with the case confirmed that Obama is the unnamed “political candidate” referred to in a section of the document that accuses Rezko of orchestrating a scheme in which a firm hired to handle state teacher pension investments first had to pay $250,000 in “sham” finder’s fees. From that money, $10,000 was donated to Obama’s successful run for the Senate in the name of a Rezko business associate, according to the court filing and the source.
Rezko, who was part of Obama’s senatorial finance committee, also is accused of directing “at least one other individual” to donate money to Obama and then reimbursing that individual — in possible violation of federal election law.
A spokesman for U.S. Attorney Patrick Fitzgerald declined to comment.
Obama — a state senator when he got the contributions in 2004 — has moved to distance himself from Rezko since his longtime friend and supporter was indicted in October 2006. After news reports that Obama had engaged in a real estate transaction with Rezko’s wife at a time Tony Rezko was known to be under investigation, the senator called the episode “boneheaded” and “a mistake.”
‘No way of knowing’
Obama campaign aides said Friday he was unaware Rezko was behind the contributions cited in last month’s court filing or that the document referred to the senator.
“We have no way of knowing he is the politician named here,” spokesman Bill Burton said, “but we returned this money months ago for other reasons.”
Obama donated more than $44,000 in Rezko-linked contributions to charity last year, including the $10,000 donation mentioned in the court filing.
That money was donated to Obama by Joseph Aramanda, a Glenview businessman and Rezko associate who, sources have said, is the “Individual D” prosecutors say received the $250,000 in finder’s fees demanded by Rezko. Individual D did nothing to earn those fees, according to prosecutors.
The $10,000 contribution to Obama was given in Aramanda’s name on March 5, 2004, records show. While Obama’s camp has said the senator did not know Aramanda, Obama’s office hired Aramanda’s son as an intern in 2005, at Rezko’s urging.
Repeated attempts to reach Aramanda, who was involved in pizza franchises Rezko owned, were unsuccessful. He has not been charged with any wrongdoing.
A longstanding relationship
Rezko is one of Obama’s earliest political patrons. Long known as a prolific fund-raiser, the Syrian-born businessman helped raise money for Obama’s political campaigns beginning in 1995, when Obama was running for the Illinois Senate.
In 13 years in politics, Obama has gotten at least $168,000 in campaign donations from Rezko, his family and business associates. The Sun-Times reported that figure last June. Obama’s “best estimate” seven months earlier had been that Rezko had raised no more than $60,000 for him.
When Obama ran for the U.S. Senate, Rezko held a June 27, 2003, cocktail party in Rezko’s Wilmette mansion, picking up the tab for the lavish event. Obama’s campaign staff has said it has no records to show who attended that party, or how much it cost.
Obama’s relationship with Rezko dates to 1990, when Obama, then a Harvard law student, interviewed for a job with Rezko’s development company, Rezmar Corp. Obama turned down the job, instead going to work for a small Chicago law firm — Davis Miner Barnhill. That firm did work on more than a dozen low-income housing projects Rezmar rehabbed with government funds.
Eleven Rezmar buildings were in the state Senate district Obama represented between 1996 and 2004. Many of the buildings ended up in foreclosure, with tenants living in squalid conditions, the Sun-Times reported last year. In one instance, Rezko’s company left tenants without heat for five weeks. Obama said he was unaware of problems with the buildings and minimized the legal work he’d done.
Obama’s relationship with Rezko grew closer in June 2005, when Obama and Rezko’s wife bought adjoining real estate parcels from a doctor in the South Side Kenwood neighborhood. Obama paid $1.65 million for the doctor’s mansion, while Rezko’s wife paid $625,000 for the vacant lot next door. Obama’s purchase price was $300,000 below the asking price; Rezko’s wife paid full price.
Six months later, Obama paid Rita Rezko $104,500 for one-sixth of the vacant lot, which he bought to expand his yard. In November 2006, he expressed regret about the transaction.
“It was a mistake to have been engaged with him at all in this or any other personal business dealing that would allow him, or anyone else,” Obama said, “to believe that he had done me a favor.”
A Chicago Sun-Times Exclusive: Sen. Barack Obama’s presidential campaign gave the following written responses to these questions about the Rezko court filing.
Q. What is Sen. Obama’s reaction to being referred to in the Rezko evidentiary proffer?
A. We have no way of knowing he is the politician named here but we returned this money months ago for other reasons.
Q. Was Sen. Obama aware that Rezko allegedly had directed at least one person to donate to the senator’s campaign and later reimbursed that person, possibly violating federal election law?
A. No.
Q. Has the Federal Election Commission or the U.S. attorney’s office in Chicago contacted the senator or any of his representatives about these matters?
A. No.
Q. Why has the senator donated to charity campaign contributions from Rezko and Rezko-linked people?
A. In keeping with our practice of donating to charity donations from people who have been called into question through the legal process, when he was named in documents as potentially engaging in wrongdoing we thought it was appropriate to return his donation to charity.
Q. Does the senator think this development will have any impact on the presidential campaign or undercut the senator’s message that he is an agent of change?
A. No. In fact, Sen. Obama has been a champion of reforms that have made campaign finance laws more transparent so that the public can more closely follow the source of contributions to campaigns. As with any campaign, occasionally individual contributions are called into question. Sen. Obama’s policy in such instances is to donate that money to charity which is what he did in this case seven months ago when questions first surfaced.
Thomas
November 10th - 11:22 a.m.
Patrick McDonough stumbled on tens of millions of taxpayer waste (at least $40,000,000) just by seeing private drivers sleep in their trucks. Gang bangers get good paying jobs who take bribes from outfit trucking companies who do no work.
Maybe ask Patrick McDonough where to find waste.
Frank Coconate found $60,000,000 in waste with the vortex Rain Blocker program with thousands of the devices being thrown out behind the Department of Water Managment (and many times they did not work as they were supposed to)
Falph Fero with Chicago Magazine did an analysis of the top heavy management (with 3 to 10 managers supervising 1 worker sometimes) and very large salaries of family members and politically connected people with no credentials. Even Alderman Bernard Stone did a study and spoke out on the number of over $100,000 city employees.
If Ralph Fero can find $60,000,000 in waste with the rain blockers and see the obvious top heavy and overpaid political commissioners, deputy commissioners and do nothing political workers--what about a study, a efficiency expert with an education, the US Attorneys etc.
Just read the Sun Times and the Tim Novak now regular series on political waste and corruption.
Some ways to cut (from big to small)
1. Why does Alderman Burke need 4 bodyguards and a city car and a driver? He sometimes has more police officers all assigned to him? WHY?--is he going to be assasinated?
ALSO--he is very wealthy why doesn't he hire bodyguards instead of us paying for them.
2. Why did Mayor Daley's mother (and daughtes and son)(and God rest Sis's great soul and a great lady) need a bodyguard???
Again, the Daley's are wealthy let John Daley's insurance company (which insured all the hired trucks) pay for a bodyguard or international investment and finance "guru" Williama Daley.
The taxpayers should not have to pay extra protection for alderman,
unkown and no threats to all family members.
YES, some of these jobs are hard and people in the public light can be attacked or kidnapped BUT nobody knows what Daley's daughters look like. Alderman Burke sometimes has four or more police officers and a driver and city car (and picks up friends and does social things with his city car and driver)
3. Cut the top heavy management, the deputy commissioners. Just ask Daley ally alderman Stone.
4. Cut the HDO drug dealers and thugs, cut the 11th ward ghost payrollers, cut the 19th ward do nothings.
The Operating Engineers salaries are too high.
There are whole sections of people doing nothing or Whirity swiping in and out or Strodin building a house on city time.
5. Chicago has much higher law suits by city workers and much higher workmens compensation claims than anywhere else in Illinois including coal miners.
You have to change the culture.
You have to get good lawyers and not political hacks like Mara Georges who is there to get contracts for Shefsky.
6. Cut Intergovernmental affairs, which even the alderman joke are the notebooks with their spying and writing notes on everyone.
7. Cut Maggie Daley's subsidized art program let her friend Ryan and Aon fund it and not taxpayers--not saying it might not do some good but my mom might have a great idea to help kids and I don't get taxpayer funding.
8. TIFS--just read Ben Joravsky or County Commissioner Mike Quigley.
9. The Inspector General's office under Vrstrouias was a corrupt joke. His salary was a waste. How many stupid investigations wasted money on silly stuff or protecting big corruption and waste.
Vrstourias now works in the States Attorney's office.
10. The Burge legal defense when everyone knows he is guilty and they settled or are going to settle cases that everyone knew would be settled over $20,000,000.
11. The Jeremiah Joyce Airport contracts.
12. The loss in the city revenue from selling land undervalue and buying it back for insane profits from Tom DiPiazza, Tim Degnan, Jerry Joyce, Oscar Dangelo, Michael Marchese.
13. Grants to Churches (Separation of Church and state) and no interest loans over 30 years ffor 5 million. The Reader just did a story on the blaspehemer "Rev" Lucius Hall who corrupted the "Our Father/Lord's Prayer" saying "give us our Daley, Daley, Daley bread" in exchange for corruption of the Black clergy and selling out his own people Rev. Lucius Hall has received 3,500,000 in grants.
City Commissioners used to shake down contractors and employees for Old Saint Patricks Church and government has given them a lot of breaks.
14. Alderman Stone had a good idea to sell the vacant lots the city owns or sell idle city property.
15. Every alderman should have a program to turn vacant lots into productive tax earning land.
16. Cut the stupid city council committees that do nothing and provide ghost payrollers and job spots for political people. One hack they call the hallwalker has no education and makes over $100,000 with no skills or training in his supposed field.
17. Cut the number of alderman from 50 to 25 or 20 or even 10.
18. Implement Term Limits
2 6 year terms for Mayor
3 4 year terms for Alderman
The money and power is calcifying in the wrong places.
19. Consolidate the Treasurer and Clerk into 1 appointed post. Why have elections on what de facto amounts to an appointment by the Mayor.
20. Really eliminate patronage and thus eliminate the need for the millions wasted on the stupid Federal Monitor.
21. Act right so you don't have Sorich/Slattery indictments and federal monitors and stupid Shakman settlements where Michael Shakman will make 4,000,0000 in attorneys fees.
22. The no bid and overbilling legal contracts that Mara Georges gives out to her mentor Brian Crowe at Shefsky or Freeborn Peters or other silly political connected overbilling law firms.
23. Victor Reyes, just his family members on the city payroll, let alone the money he makes from no bid contracts on redisticting (Cost taxpayers 1,300,000) or his sisters company Aztec or pass through bs minority contacts.
Let alone what Victor Reyes has cost in legal bills for investigations and law suits or all the criminal idiots who he put on the payroll (he probably put 1000 employees on the city payroll including his entire fat family)
24. The whole property tax assessment and appeals which is for the politically connected
Speaker Madigan got a 2,000,000 fee for his law firm when he saved a big airline $6,000,000 that could of gone to taxpayers
Hynes, Houlihan and company make a lot of money from the current Byzantine tax system which does not work and favors politics
Both commercial and homeowners are over taxed
25. The Duffs at $50,000,000 of phony minority contracts for cleaning and other services that could of been done better and cheaper
26. Grants to churches and non for profits that are political payback
Eliminate politically connected art programs
Eliminate the Inspector Generals office
Eliminate 20 or 30 alderman
Eliminate City Council committees
Make a 10 or 20% across the board cut
27. The Joyce cousins made a HALF A BILLION 500,000,000 of profit on the Cable buyout which was a joke
28. Daley's wife's friends and Oscar Da'Angelo made money on concessions at O'Hare
as did Tim Degnan with McDonalds
29. The towing scandal
30. The City of Chicago could probably fire at least 2000 political hack do nothing ghost payrollers
We will get to education and pensions later
Hahaha
November 10th - 3:17 p.m.
Great ideas, Thomas. I agree with most except eliminating the IG's office. If Hoffman were allowed to investigate city departments (and add the aldermen) without interference from Daley he would eliminate enough corruption to pay for his department tenfold.
Pensions will be tough to tackle, especially with the new labor agreements. Daley 10-year, 4% raise per year contract with unions, minus meaningful benefit concessions, will handcuff the city. All in the name of the Great White Olympic Whale