Jan. 31: Attorney for Rutherford employee: Allegations are “serious and real”
BY DAN MIHALOPOULOS, DAVE MCKINNEY AND NATASHA KORECKI Staff Reporters January 31, 2014 10:49AM
Illinois Treasurer Dan Rutherford contended Friday that his opponent, millionaire businessman Bruce Rauner, paid an attorney who demanded $300,000 from him on behalf of a Rutherford employee making allegations against him. | Rich Hein/Sun-Times
Updated: March 3, 2014 5:20PM
Treasurer Dan Rutherford Friday tied GOP rival Bruce Rauner to a $300,000 demand from a Rutherford employee who allegedly offered to keep politically damaging accusations against the treasurer “under wraps” in exchange for the money.
In a strange turn that could shake up the Republican governor’s race, Rutherford said the allegations made to his staff lawyers last week by a current employee in his office are false but declined to describe them.
Sources with knowledge of the allegations say that the male employee is lodging both EEOC harassment allegations and a First Amendment complaint against Rutherford.
At a news conference Friday, Rutherford, his voice filled with tension, accused Rauner of being behind the allegations and trying to destroy him.
“I’m going to turn this back on him,” Rutherford said of Rauner. “I find this to be very, very offensive . . . Illinois politics is hardball.”
Rauner’s campaign denied any involvement in the matter, which comes at a politically sensitive time for both candidates since the March 18 primary is seven weeks away.
“Treasurer Rutherford should spend his time answering the serious claims made against him by a state employee, rather than trying to distract attention with false claims against us,” Rauner spokesman Mike Schrimpf said.
In an age of tightly scripted campaigns, the bid by Rutherford to get out in front of the story before any potential allegations surface in a lawsuit or other complaint was surprising and fraught with political risk.
His maneuver winds up introducing to voters the potentially negative perception that he’s hiding something that could cripple his gubernatorial ambitions.
At his hastily called press conference, Rutherford and the top attorney in his office said the demand for money came from Chicago lawyer Christine Svenson, who is representing the employee and has done work for the Rauner campaign.
Rutherford said Svenson made the cash demand in a conversation with the treasurer’s lawyer on Jan. 23. Then, she promised the $300,000 would ensure “we will walk away and keep it under wraps,” the treasurer said.
In a statement she issued late Friday, Svenson denied any political motivation in her discussions with the treasurer’s representatives and described her client’s charges against Rutherford as “serious and real.”
“This is not a matter of politics, nor is it about me. To the contrary, this matter is about my client,” she said, declining to identify that person.
But Rutherford, without directly calling the matter political extortion, said the situation “has basically been set up” by Rauner, noting that Rauner’s campaign employed Svenson.
In filings with state elections officials, the Rauner campaign fund reported paying $3,500 to Svenson’s law firm in Chicago on July 30.
But Schrimpf, the Rauner spokesman, said the payment to Svenson had nothing to do with Rutherford. The Rauner campaign had hired Svenson to review its office lease “because our regular attorney had a conflict of interest with the landlord,” Schrimpf said.
“We paid her a one-time fee of $3,500 for that service and never discussed anything with her related to the treasurer,” said Schrimpf, who said Svenson was referred to the Rauner campaign by Craig Burkhardt, an election-law attorney.
Burkhardt last summer hosted a fundraiser for Rutherford and was hired briefly last fall to straighten out problems with the treasurer’s nominating petitions.
Burkhardt, who said Friday he has no ongoing relationship with the treasurer’s gubernatorial campaign, confirmed in an interview with the Chicago Sun-Times that he recommended Svenson to the Rauner camp last March.
“That was far, far in advance of any working relationship I had with the Rutherford campaign,” Burkhardt said.
Svenson called Rutherford’s statements against her “unfortunate” and stressed she has had no relationship with Rauner or his campaign outside the role she played in reviewing an office lease.
“It is important at the onset that I make clear that I have nothing to do with the Bruce Rauner campaign other than a brief piece of legal work that I did for them last year: the negotiation and review of a single office lease,” she said, stressing she has had no contact with the campaign since April 2013 when the work was performed.
Svenson said her client has initiated a complaint against Rutherford with the treasurer’s office inspector general.
At the news conference, Rutherford repeatedly dodged reporters’ questions about the nature of the allegations against him, saying he was advised by his lawyer that he can’t reveal the identity of his accuser or disclose what the charges are.
“You look at this, and you put the dots together,” Rutherford told reporters as he ended the news conference.
The surreal event had begun with Rutherford saying, “I want to have a conversation with you about some activity that’s come about.” He was flanked at the podium by Neil Olson, general counsel for the treasurer’s office, and a former FBI agent named Anthony D’Angelo who Rutherford said his office had hired.
“There’s absolutely no truth to the allegations,” Rutherford said. “No factual support or merit.”
Still, he said the treasurer’s office has hired Ron Braver and Associates, a corporate investigations firm, to conduct a probe. Braver is a former IRS special agent.
Neither state Sen. Bill Brady, R-Bloomington, nor Sen. Kirk Dillard, R-Hinsdale, the two other Republican candidates for governor, offered any comment on the peculiar back-and-forth between Rauner and Rutherford.
One top legal expert said he was baffled by the facts Rutherford laid out and the apparent conduct by Svenson in trying to initiate a settlement on behalf of her client.
“If the claim is this is some kind of settlement, it’s the oddest kind of settlement I’ve ever heard of,” said Andrew D. Leipold, a professor at the University of Illinois College of Law and director of the law school’s Program in Criminal Law and Procedure.
“I can’t figure out why anyone would think Rutherford would say, ‘OK, here’s the money.’ He’s a smart guy. He knows if someone is trying to make him pay money to keep information quiet, he’s likely to end up paying the money, getting exposed for paying the money and then having whatever secret it was come out,” Leipold told the Sun-Times.
In Rutherford blaming Rauner and thereby intimating some form of political extortion taking place, Leipold said the onus then falls on the treasurer: “If that’s what is happening, I’m assuming Mr. Rutherford has contacted law enforcement. He’s a capable guy.”
Rutherford did not give any indication he had contacted authorities.
In her statement, Svenson disclosed that she had been having discussions “on a good-faith basis for days” with Rutherford’s general counsel and in-house counsel, and “both expressed a strong interest in keeping the matter private.”
“These types of negotiations are, in my experience, common with regard to the treasurer’s office and have nothing to do with politics or the gubernatorial primary,” she said. “This morning, Mr. Rutherford chose to make this matter about politics, probably because the facts are so troubling.
“I have nothing against Dan Rutherford and have no horse in the governor’s primary race,” she continued. “We are currently exploring our legal options.”