Illinois Governor Rod Blagojevich taken into federal custody
December 9, 2008
BY NATASHA KORECKI Federal Courts Reporter
http://www.drudgereport.com/ Gov. Blagojevich and his chief of staff John Harris were arrested at their homes this morning in a probe involving the governor’s quest to fill Sen. Barack Obama’s Senate seat.
The charges also include alleged attempts by the governor to influence the Tribune editorial board.
The governor threatened that if the Tribune didn’t support the governor, he wouldn’t approve the sale of Wrigley Field.
The complaint contends Blagojevich threatened to withhold substantial state assistance to the Tribune Company in connection with the sale of Wrigley to induce the firing of Chicago Tribune editorial board members sharply critical of Blagojevich.
The governor is also accused of obtaining campaign contributions in exchange for official actions — both in the past and recently in a push before a new state ethics law takes effect Jan. 1.
Blagojevich, 51, and Harris, 46, both of Chicago, are each charged with conspiracy to
commit mail and wire fraud and solicitation of bribery.
They were charged in a two-count criminal complaint that was sworn out on Sunday and unsealed today following their arrests, which occurred without incident, the feds said.
A 76-page FBI affidavit alleges that Blagojevich was intercepted on court-authorized wiretaps during the last month conspiring to sell or trade Illinois’ U.S. Senate seat vacated by Obama for financial and other personal benefits for himself and his wife.
At various times, in exchange for the Senate appointment, Blagojevich allegedly discussed obtaining:
• A substantial salary for himself at a either a non-profit foundation or an organization affiliated with labor unions.
• Placing his wife on paid corporate boards where he speculated she might garner as much as $150,000 a year.
• Promises of campaign funds — including cash up front.
• A cabinet post or ambassadorship for himself.
On Dec. 4, Blagojevich allegedly told an advisor that he might “get some (money) up front, maybe” from Senate Candidate 5, if he named Senate Candidate 5 to the Senate seat, to insure that Senate Candidate 5 kept a promise about raising money for Blagojevich if he ran for re-election. In a recorded conversation on Oct. 31, Blagojevich claimed he was approached by an associate of Senate Candidate 5 as follows: “We were approached to ‘pay to play.’ That, you know, he’d raise 500 grand. An emissary came. Then the other guy would raise a million, if I made him (Senate Candidate 5) a Senator.”
On Nov. 7, while talking on the phone about the Senate seat with Harris and an advisor, Blagojevich said he needed to consider his family and that he is “financially” hurting, the complain states.
Harris allegedly said that they were considering what would help the “financial security” of the Blagojevich family and what will keep Blagojevich “politically viable.” Blagojevich stated, “I want to make money,” adding later that he is interested in making $250,000 to $300,000 a year, the complaint alleges.
On Nov. 10, in a lengthy telephone call with numerous advisors that included discussion about Blagojevich obtaining a lucrative job with a union-affiliated organization — in exchange for appointing a particular Senate Candidate whom he believed was favored by the President-elect — Blagojevich and others discussed various ways Blagojevich could “monetize” the relationships he has made as governor to make money after leaving that office, the complain alleges.
“The breadth of corruption laid out in these charges is staggering,” U.S. Attorney Patrick Fitzgerald said. “They allege that Blagojevich put a ‘for sale’ sign on the naming of a United States Senator; involved himself personally in pay-to-play schemes with the urgency of a salesman meeting his annual sales target; and corruptly used his office in an effort to trample editorial voices of criticism. The citizens of Illinois deserve public officials who act solely in the public’s interest, without putting a price tag on government appointments, contracts and decisions,” he added.
Robert Grant, in charge of the FBI office in Chicago, added: “Many, including myself, thought that the recent conviction of a former governor would usher in a new era of honesty and reform in Illinois politics. Clearly, the charges announced today reveal that the office of the Governor has become nothing more than a vehicle for self-enrichment, unrestricted by party affiliation and taking Illinois politics to a new low.”
Federal agents today also executed search warrants at the offices of Friends of Blagojevich at 4147 N. Ravenswood.
The feds saidd the charges focus on events since October when they obtained information that Blagojevich and “Fundraiser A,” who is chairman of Friends of Blagojevich, were accelerating Blagojevich’s allegedly corrupt fund-raising activities to accumulate as much money as possible this year before a new state ethics law would severely curtail Blagojevich’s ability to raise money from individuals and entities that have existing contracts worth more than $50,000 with the state of Illinois.
Agents said they learned that Blagojevich was seeking approximately $2.5 million in campaign contributions by the end of the year, principally from or through individuals or entities — many of whom have received state contacts or appointments – identified on a list maintained by Friends of Blagojevich, which the FBI has obtained.
The complaint details several incidents involving efforts by Blagojevich to obtain campaign contributions in connection with his official actions as governor, including three in early October:
• After an Oct. 6 meeting with Harris and Individuals A and B, during which Individual B sought state help with a business venture, Blagojevich told Individual A to approach Individual B about raising $100,000 for Friends of Blagojevich this year. Individual A said he later learned that Blagojevich reached out directly to Individual B to ask about holding a fund-raiser.
• Also on Oct.r 6, Blagojevich told Individual A that he expected Highway Contractor 1 to raise $500,000 in contributions and that he was willing to commit additional state money to a Tollway project — beyond $1.8 billion that Blagojevich announced on Oct.15 — but was waiting to see how much money the contractor raised for Friends of Blagojevich.
• On Oct. 8, Blagojevich told Individual A that he wanted to obtain a $50,000 contribution from Hospital Executive 1, the chief executive officer of Children’s Memorial Hospital in Chicago, which had recently received a commitment of $8 million in state funds. When the contribution was not forthcoming, Blagojevich discussed with Deputy Governor A the feasibility of rescinding the funding.
On Oct. 21, the government obtained a court order authorizing the interception of conversations in both a personal office and a conference room used by Blagojevich at the offices of Friends of Blagojevich. The FBI began intercepting conversations in those rooms on the morning of Oct. 22. A second court order was obtained last month allowing those interceptions to continue.
On Oct. 29, a court order was signed authorizing the interception of conversations on a hardline telephone used by Blagojevich at his home. That wiretap was extended for 30 days on Nov. 26, according to the affidavit.
Another alleged example of a pay-to-play scheme was captured in separate telephone conversations that Blagojevich had with Fundraiser A on November 13 and Lobbyist 1 on Dec. 3. Lobbyist 1 was reporting to Blagojevich about his efforts to collect a contribution from Contributor 1 and related that he “got in his face” to make it clear to Contributor 1 that a commitment to make a campaign contribution had to be done now, before there could be some skittishness over the timing of the contribution and Blagojevich signing a bill that would benefit Contributor 1.
Blagojevich commented to Lobbyist 1 “good” and “good job.” The bill in question, which is awaiting Blagojevich ’s signature, is believed to be legislation that directs a percentage of casino revenue to the horse racing industry.
Regarding the Senate seat, the charges allege that Blagojevich, Harris and others have engaged and are engaging in efforts to obtain personal gain, including financial gain, to benefit Blagojevich and his family through corruptly using Blagojevich’s sole authority to appoint a successor to the unexpired term of the President-elect’s former Senate seat, which he resigned effective Nov. 16. The affidavit details numerous conversations about the Senate seat between Nov. 3 and Dec. 5. In these conversations, Blagojevich allegedly discussed the attributes of potential candidates, including their abilities to benefit the people of Illinois, and the financial and political benefits he and his wife could receive if he appointed various of the possible candidates.
Throughout the intercepted conversations, Blagojevich also allegedly spent significant time weighing the option of appointing himself to the open Senate seat and expressed a variety of reasons for doing so, including: frustration at being “stuck” as governor; a belief that he will be able to obtain greater resources if he is indicted as a sitting Senator as opposed to a sitting governor; a desire to remake his image in consideration of a possible run for President in 2016; avoiding impeachment by the Illinois legislature; making corporate contacts that would be of value to him after leaving public office; facilitating his wife’s employment as a lobbyist; and generating speaking fees should he decide to leave public office.
In the earliest intercepted conversation about the Senate seat described in the affidavit, Blagojevich told Deputy Governor A on Nov. 3 that if he is not going to get anything of value for the open seat, then he will take it for himself: “If . . . they’re not going to offer anything of any value, then I might just take it.”
Later that day, speaking to Advisor A, Blagojevich allegedly said: “I’m going to keep this Senate option for me a real possibility, you know, and therefore I can drive a hard bargain.” He added later that the seat “is a [expletive] valuable thing, you just don’t give it away for nothing.”
Over the next couple of days — Election Day and the day after — Blagojevich was allegedly captured discussing with Deputy Governor A whether he could obtain a cabinet position, such as Secretary of Health and Human Services or the Department of Energy or various ambassadorships.
In a conversation with Harris on Nov. 4, Blagojevich compared his situation to that of a sports agent shopping a potential free agent to the highest bidder. The day after the election, Harris allegedly suggested to Blagojevich that the President-elect could make him the head of a private foundation.
Later on Nov. 5, Blagojevich said to Advisor A, “I’ve got this thing and it’s [expletive] golden, and, uh, uh, I’m just not giving it up for [expletive] nothing. I’m not gonna do it. And, and I can always use it. I can parachute me there,” the affidavit states.
Two days later, in a three-way call with Harris and Advisor B, a consultant in Washington, Blagojevich and the others allegedly discussed the prospect of a three-way deal for the Senate appointment involving an organization called “Change to Win,” which is affiliated with various unions including the Service Employees International Union (SEIU).
On Nov. 10, Blagojevich, his wife, Harris, Governor General Counsel, Advisor B and other Washington-based advisors participated at different times in a two-hour phone call in which they allegedly discussed, among other things, a deal involving the SEIU.
Harris allegedly said they could work out a deal with the union and the President-elect where SEIU could help the President-elect with Blagojevich’s appointment of Senate Candidate 1, while Blagojevich would obtain a position as the national director of the Change to Win campaign and SEIU would get something favorable from the President-elect in the future.
Also during that call, Blagojevich agreed it was unlikely that Obama would name him Secretary of Health and Human Services or give him an ambassadorship because of all of the negative publicity surrounding him, according to the complaint.
In a conversation with Harris on Nov. 11, the charges state, Blagojevich said he knew Obama wanted Senate Candidate 1 for the open seat but “they’re not willing to give me anything except appreciation. [Expletive] them.”
Earlier in that conversation, Blagojevich suggested starting a 501(c)(4) non-profit organization, which he could head and engage in political activity and lobbying. In that conversation with Harris and other discussions with him and others over the next couple of days, Blagojevich suggested by name several well-known, wealthy individuals who could be prevailed upon to seed such an organization with $10 million to $15 million, and suggesting that he could take the organization’s reins when he is no longer governor, according to the affidavit.
On Nov. 12, Blagojevich spoke with SEIU Official who was in Washington. This conversation occurred about a week after Blagojevich had met with SEIU Official to discuss the Senate seat, with the understanding that the union official was an emissary to discuss Senate Candidate 1's interest in the Senate seat.
During the Nov. 12 conversation, Blagojevich allegedly explained the non-profit organization idea to SEIU Official and said that it could help Senate Candidate 1. The union official agreed to “put that flag up and see where it goes,” although the official also had said he wasn’t certain if Senate Candidate 1 wanted the official to keep pushing her candidacy. Senate Candidate 1 eventually removed herself from consideration for the open seat.
Also on Nov. 12, in a conversation with Harris, the complaint affidavit states that Blagojevich said his decision about the open Senate seat will be based on three criteria in the following order of importance: “Our legal situation, our personal situation, my political situation. This decision, like every other one, needs to be based upon that. Legal. Personal. Political.”
Harris said: “Legal is the hardest one to satisfy.”
Blagojevich said that his legal problems could be solved by naming himself to the Senate seat.
As recently as Dec. 4, in separate conversations with Advisor B and Fundraiser A, Blagojevich said that he was “elevating” Senate Candidate 5 on the list of candidates because, among other reasons, if Blagojevich ran for re-election, Senate Candidate 5 would “raise money” for him.
Blagojevich said that he might be able to cut a deal with Senate Candidate 5 that provided Blagojevich with something “tangible up front.”
Noting that he was going to meet with Senate Candidate 5 in the next few days, Blagojevich told Fundraiser A to reach out to an intermediary (Individual D), from whom Blagojevich is attempting to obtain campaign contributions and who Blagojevich believes is close to Senate Candidate 5.
Blagojevich told Fundraiser A to tell Individual D that Senate Candidate 5 was a very realistic candidate but Blagojevich was getting a lot of pressure not to appoint Senate Candidate 5, according to the affidavit.
Blagojevich allegedly told Fundraiser A to tell Individual D that if Senate Candidate 5 is going to be chosen, “some of this stuff’s gotta start happening now . . . right now . . . and we gotta see it.”
Blagojevich continued, “You gotta be careful how you express that and assume everybody’s listening, the whole world is listening. You hear me?”
Blagojevich further directed Fundraiser A to talk to Individual D in person, not by phone, and to communicate the “urgency” of the situation.
Blagojevich spoke to Fundraiser A again the next day, Dec. 5, and discussed that day’s Chicago Tribune front page article stating that Blagojevich had recently been surreptitiously recorded as part of the ongoing criminal investigation.
Blagojevich instructed Fundraiser A to “undo your [Individual D] thing,” and Fundraiser A confirmed it would be undone, the complaint alleges.
Also on Dec. 5, Blagojevich and three others allegedly discussed whether to move money out of the Friends of Blagojevich campaign fund to avoid having the money frozen by federal authorities and also considered the possibility of prepaying the money to Blagojevich’s criminal defense attorney with an understanding that the attorney would donate the money back at a later time if it was not needed. They also discussed opening a new fund raising account named Citizens for Blagojevich with new contributions.
According to the affidavit, intercepted phone calls revealed that the Tribune Company, which owns the Chicago Tribune and the Chicago Cubs, has explored the possibility of obtaining assistance from the Illinois Finance Authority relating to the Tribune Company’s efforts to sell the Cubs and the financing or sale of Wrigley Field.
In a Nov. 6 phone call, Harris explained to Blagojevich that the deal the Tribune Company was trying to get through the IFA was basically a tax mitigation scheme in which the IFA would own title to Wrigley Field and the Tribune would not have to pay capital gains tax, which Harris estimated would save the company approximately $100 million.
Intercepted calls allegedly show that Blagojevich directed Harris to inform the Tribune and an associate, identified as Tribune Financial Advisor, that state financial assistance would be withheld unless members of the Chicago Tribune’s editorial board were fired, primarily because Blagojevich viewed them as driving discussion of his possible impeachment.
In a Nov. 4 phone call, Blagojevich allegedly told Harris that he should say to Tribune Financial Advisor, the Cubs chairman and the Tribune owner, “our recommendation is fire all those [expletive] people, get ‘em the [expletive] out of there and get us some editorial support.”
On Nov. 6, the day of a Tribune editorial critical of Blagojevich , Harris told Blagojevich that he told Tribune Financial Advisor the previous day that things “look like they could move ahead fine but, you know, there is a risk that all of this is going to get derailed by your own editorial page.”
Harris also told Blagojevich that he was meeting with Tribune Financial Advisor on Nov. 10.
In a Nov. 11 intercepted call, Harris allegedly told Blagojevich that Tribune Financial Advisor talked to Tribune Owner and Tribune Owner “got the message and is very sensitive to the issue.”
Harris told Blagojevich that according to Tribune Financial Advisor, there would be “certain corporate reorganizations and budget cuts coming and, reading between the lines, he’s going after that section.”
Blagojevich allegedly responded: “Oh. That’s fantastic.”
