City ignored possible O'Hare 'front' for years
Inspector's report says minority 'owner' admitted he didn't run eateries in 2002
Crucial Inc. won the O'Hare concessions in part because it was certified as a minority-owned business. Its largest shareholder was listed as Jabir Herbert Muhammad, son of the late Nation of Islam founder, Elijah Muhammad.
But a compliance officer inspected the firm nearly three years ago and was told by Muhammad himself that he was not running the day-to-day operations of the restaurants as required by the city.
"Everything is done by Panda Express," certification officer Robert Cunniff concluded in a July 31, 2002, report obtained by the Chicago Sun-Times. "Herbert Muhammad said that he was used to get Panda in the airport."
Crucial "seems to be a front for minority business enterprise status for Panda Express," Cunniff continued, noting that Crucial appeared to be operating out of an office for "Rezko Panda Express."
Yet it wasn't until Tuesday that the city finally took action against Crucial, accusing it of being a front for Panda Express and Rezko, listed in company records as a 45 percent owner.
City officials couldn't explain why it took so long but said they'd get to the bottom of the matter and reaffirmed their commitment to clean up the city program that allows blacks, Hispanics and women to get an inside track on city business. The program has been tarred by a relentless string of scandals, even after set-aside standards were tightened to satisfy a federal judge.
"We were not here in 2002, but clearly our mission is to make sure we address all of the issues in these files," said recently appointed first deputy procurement officer, Lori Lightfoot. "We're looking at internal personnel and reasons why systems broke down. We're going to tighten internal controls so something like this doesn't happen again."
'Did the wind shift?'
Muhammad, who is in his mid-70s and has an undisclosed illness, said through his lawyer he plans to respond to the city's allegations within the allotted 15-day period.
Attorney Roxanne Jackson said Muhammad met with city officials about three years ago, "told them of his failing health and answered all of their questions honestly.
"When he walked out of that meeting, things were OK," she said. "Three years later, everything blows up. What happened? Did the wind shift? I have no idea, and neither does he."
The two Panda restaurants he operates at O'Hare are expected to stay open in the meantime.
David Malone was the city's chief procurement officer at the time the compliance officer submitted his findings. But Malone insisted Wednesday that the report never landed on his desk.
"Of course, if I had known, I would have acted on it. But I didn't see that report. We were doing somewhere in the neighborhood of 350 to 400 certifications a year. I didn't read all of them. I read the ones that were brought to my attention. This report did not come to my attention," said Malone, who is now an executive at Chicago-based Mesirow Financial.
Asked if he's embarrassed that an O'Hare concessionaire was allowed to operate under his watch even though it was found to be a "front," Malone said: "I'm not embarrassed by things that I don't get a chance to decide on. If I get a chance to make a decision and make the wrong decision, I'm willing to stand behind it. But I have to have an opportunity to make that decision."
Crucial -- which at one point also had a concessions deal with the Chicago Park District -- grossed $15.7 million between 1999 and 2002, city records show.
Muhammad owns 55 percent of Crucial and Rezko has 45 percent, according to the most recent records available. Though a Syrian immigrant, Rezko is not considered a minority under city rules. Neither is Panda Express owner Andrew Cherng, who is Asian.
Role for SBC questioned
Muhammad, boxer Muhammad Ali's former manager, told the city's compliance officer that Panda does pricing, marketing and contract negotiations for the O'Hare restaurants. When it came to managing Crucial's office, he said he wasn't responsible and that the work was done by Al Chaib, a Rezko business associate who has since won a Subway franchise deal at Illinois tollway oases.
"Mr. Rezko is out of the country traveling on business, and when he returns, he will deal with this appropriately," a Rezko spokesman said.
A Panda spokeswoman declined to return calls.
A separate company also run by Muhammad and Rezko -- Crucial Communications -- is a minority subcontractor to SBC on the pay-telephone contract at Cook County Jail. Some county commissioners questioned what Crucial does for SBC when the telecommunications giant was awarded the no-bid, $10 million contract two years ago.
Contributing: Abdon M. Pallasch