Public Official A: 'Shots landing all around him'
U.S. Attorney Patrick Fitzgerald cautioned Thursday that people shouldn’t jump to conclusions about three people linked to Gov. Blagojevich being indicted on the same day.
But, for the second time, the governor is identified in a federal corruption indictment — this time as “Public Official A,” a source close to the investigation said.
(AP/Sun-Times files)
Former investment banker P. Nicholas Hurtgen allegedly told a hospital executive “Public Official A” wanted hospital projects steered to a preferred contractor, and that the desire to reward that contractor was “all about money” for political campaigns, Hurtgen’s indictment alleges. The governor’s office issued a forceful denial, claiming not to be that public official.
But, regardless of that denial and Fitzgerald’s admonishment, this much is clear: The indictments of Hurtgen, Christopher G. Kelly and Abdelhamid “Al” Chaib leave Blagojevich facing a world of political, financial and potentially criminal trouble.
“It’s like the game Battleship, and the shots are landing all around him,” said Jay Stewart, executive director of the Better Government Association. “If [the investigation] isn’t directed at the governor, it’s sure coming close to him.”
Federal prosecutors already have secured a guilty plea from political insider Stuart Levine in their wide-ranging probe of state-government corruption, which includes kickback schemes involving pension and hospital-construction boards.
They’ve also indicted former gubernatorial fund-raiser Tony Rezko, who is fighting charges he demanded kickbacks and Blagojevich campaign contributions from firms seeking state business.
On Thursday, the feds hit Kelly, the governor’s former campaign fund chairman, with gambling-related tax-fraud charges that weren’t tied to Blagojevich. But the prospect of an extended prison stay could spark Kelly into entering a guilty plea and cooperating, perhaps enabling the feds to bring charges against the governor’s campaign fund as they did to former Gov. George Ryan.
Then there’s Chaib, whom the Sun-Times outed Thursday as owning Subway sandwich shops at Illinois Tollway oases despite owing $359,639 in unpaid back taxes. Chaib was indicted for participating in a business loan-fraud scheme with Rezko and former Blagojevich administration official Ali D. Ata, who also is under indictment. Chaib, who helped build Rezko’s business empire, could prove a valuable witness against Rezko should he decide to plead guilty.
Hurtgen finds himself back under indictment after a judge dismissed criminal charges against him earlier this year. The feds recast the hospital-kickback scheme charges against the former Bear Stearns investment banker — including a new detail involving the governor.
Hurtgen was the one who allegedly told Edward Hospital CEO Pam Davis of the governor’s personal interest in her hospital projects and the strong desire by him and Levine to see now-indicted construction magnate Jacob Kiferbaum in charge of the work.
“Hurtgen told the CEO that she did not want to know why Levine and Public Official A wanted Kiferbaum to get the Edward Hospital construction projects, but advised her that the support for Kiferbaum by Public Official ” and those surrounding Public Official A was ‘all about money’ for political campaigns,” according to Hurtgen’s indictment.
A source close to the federal investigation confirmed “Public Official A” is Blagojevich. The governor’s spokeswoman, Abby Ottenhoff, said the governor’s office didn’t know who that person is: “Based on the description in the indictment, it’s not the governor,” she said.
The governor’s office issued a similar denial when sources identified Blagojevich as a “certain public official” in the Rezko indictment.
Political fallout from the indictments could be acute for the unpopular governor. With lawmakers heading back to the Statehouse on Monday, Blagojevich’s push for new casinos to fund a multibillion-dollar state construction program undoubtedly will be set back because of Kelly’s indictment stemming from massive gambling losses.
“This absolutely makes it harder to sell any kind of gambling deal,” said Senate Majority Leader Debbie Halvorson (D-Crete). “It proves what a societal problem gambling is.”
Beyond the political damage, the latest indictments are sure to weaken Blagojevich's already-stunted fund-raising ability and put pressure on him to return the $212,000 that Kelly's companies donated during his first campaign. For now, the governor doesn’t intend to divest his $284,000 political fund of any Kelly-tainted dollars, campaign spokesman Doug Scofield said.
“We won’t rush to judgment. These are allegations. They’re unproven. They’re personal and unrelated in any way to state business,” he said.
In 2005, the governor refunded $19,500 to Democratic activist Joseph Cari and pension-system lawyer Steven Loren just one day after they were charged by the feds in an alleged scheme to wrest Blagojevich campaign contributions from firms seeking state pension business.
“I’m not happy our chief executive is under this kind of cloud. The fact they even named him in the indictment seems to me he remains a target,” said Sen. Dan Cronin (R-Elmhurst). “I think the governor is finished. I think everybody knows he is not only incapable of governing, but now it’s apparent there are serious criminal issues.”