Former Ill. Gov. Blagojevich, brother, top fundraiser indicted

From TheMatadorOnline.com Newsroom:

By Rick Pearson and Jeff Coen

Chicago Tribune

(MCT)

CHICAGO _ Federal prosecutors expanded their case against former Illinois Gov. Rod Blagojevich Thursday in an indictment that drew more of his closest aides into the scandal and adds new schemes to the list of charges against him: Pocketing money funneled through his wife through a phony real estate job. Shaking down a powerful congressman. Running the state as a racket.

Coming nearly four months after federal agents roused a sitting governor out of his home in a pre-dawn arrest _ and weeks after lawmakers dumped him from power _ Thursday's indictment of Blagojevich, his brother and four former top insiders could have been anti-climactic.

Instead, prosecutors added a few more chapters to the Blagojevich saga, further pulling in his family into the pay-to-play conspiracy, revealing yet more confidants had turned on him and suggesting he was intent on corruption before he was even sworn in. The indictment carries a potentially lengthy prison sentence and possible forfeiture of his family home should Blagojevich be convicted.

After turning Illinois politics into an amusement-park ride, most notably for allegedly trying to sell President Barack Obama's Senate seat, Blagojevich spent the day of his indictment with his family at Walt Disney World in Florida.

The indictment alleged that Blagojevich and his most trusted confidants conspired to enrich themselves before his election as governor in November 2002, even striking a deal to divide the spoils after he left the state's highest office.

Blagojevich was indicted on 16 racketeering, fraud and extortion counts. Among the new, damaging allegations were that Blagojevich delayed a $2 million grant to a public charter school while trying to extort campaign cash from now-White House Chief of Staff Rahm Emanuel and threatened to withhold future state business from financial institutions that refused to hire his wife.

Blagojevich's effort to profit, both personally and for his Friends of Blagojevich campaign fund, was so pervasive that federal prosecutors labeled the racketeering scheme "The Blagojevich Enterprise."

"The primary purpose of the Blagojevich Enterprise was to exercise and preserve power over the government of the State of Illinois for the financial and political benefit of Rod Blagojevich, both directly and through Friends of Blagojevich, and for the financial benefit of his family members and associates," the indictment alleged.

Also indicted were Blagojevich's close friend and fundraiser, Christopher Kelly, and two former chiefs of staff _ Alonzo "Lon" Monk, a long-time friend who also managed Blagojevich's campaigns for governor and later became a well-healed lobbyist, and John Harris, who succeeded Monk as chief of staff. Blagojevich's brother, Robert, who headed his campaign fund, also was charged, as was Illinois Republican powerbroker William Cellini.

Blagojevich's wife, Patricia, was not indicted but was essentially described as a co-conspirator amid efforts to enrich herself and the Blagojevich family.

Prosecutors said Harris had agreed to cooperate, and details contained in the indictment indicated that Antoin "Tony" Rezko, once a major fundraiser and adviser to Blagojevich who was convicted in June on corruption charges, also was helping to build the case against the former governor. And in a new twist, sources also said Monk had negotiated to work with federal prosecutors.

In a statement released by the public relations firm representing him, Blagojevich said he was "innocent."

Orlando's WESH-TV posted on its Web site a video of the former governor in sunglasses and shorts sitting beside a pool. As his wife tried to block the camera's view, Blagojevich declined to discuss the charges and said he would talk "at the appropriate time."

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It was clear from the indictment that new cooperation from former close associates, such as Rezko, was providing prosecutors with valuable information.

The indictment alleged that Rezko played an integral role in boosting the Blagojevich family's finances, steering little- or no-work real estate commissions to Patricia Blagojevich's real estate firm and later hiring her for his own real estate business at $12,000 a month. Rezko also allegedly gave Monk as much as $90,000 to help pay for a car and home improvements.

Among the earliest and biggest plots in the "Blagojevich Enterprise" was a scheme to direct the sale of billions of dollars in bonds to refinance the state's pension debt to a company whose lobbyist secretly agreed to kick back hundreds of thousands of dollars to Rezko. Sources with knowledge of the situation identified that company as Bear Stearns and the lobbyist as Robert Kjellander.

The indictment also alleged that even though it was public knowledge in 2006 that Rezko and Kelly were under federal investigation, Blagojevich continued his effort to benefit from his post. One notable example involved Emanuel, then a congressman, who was supporting a $2 million grant for Chicago Academy, but Blagojevich allegedly delayed it in an effort to force Emanuel and one of the congressman's brothers to hold a fundraiser for him.

The indictment largely restated the criminal charges leveled against Blagojevich in the December complaint. It contended he sought to profit from the sale of his appointment of a U.S. Senate successor to Obama in forms ranging from an ambassadorship or Cabinet post to a job for his wife.

The indictment also restated that Blagojevich allegedly tried to seek the firing of Chicago Tribune editorial writers who were critical of him in exchange for granting state help in the sale of Wrigley Field. The indictment indicates Blagojevich directed Harris to go to Tribune Co. leaders with the proposal, but did not allege that Harris followed through with the governor's request.

Prosecutors are seeking the forfeiture of more than $188,000 from Blagojevich, and threatened to go after his property _ including his Ravenswood Manor home and an apartment in Washington D.C.

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© 2009, Chicago Tribune.

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