Golden (37 page)

Tusk never told Emanuel about Blagojevich's scheme even as Emanuel was joining the legions of politicians beginning to distrust Blagojevich. The two were still working together to thumb their noses at President Bush over the issue of importing prescription drugs into the United States.

Blagojevich was happily using his bully pulpit to grab national headlines promoting health-care issues. One was a state-initiated website that allowed consumers to buy medicine from Canada and other foreign nations. The
other was his decision to buy $2.6 million of flu vaccines from overseas in the middle of a national flu vaccine scare. Both had dubious success. Few people used the online service, and the Bush administration never allowed the flu vaccines to enter the country, forcing Blagojevich to donate the medicine to earthquake-ravaged Pakistan. But even there it didn't help anybody as Pakistani health officials burned the half-million doses because they had expired.

The governor then launched All Kids, a showpiece health-care program that made state-subsidized health insurance available to all Illinois children. Blagojevich promoted the program for months and felt that it alone could win him reelection. But he didn't stop with the attention-getters. He introduced legislation to ban the sale of violent video games to minors, even though both he and Tusk realized it was likely to get knocked down by the courts as being unconstitutional. Still, it pushed the conversation.

But soon enough the conversation was back to the tidal wave of scandal washing over the governor, with either him, Kelly, or Rezko always seemingly drowning in it.

News broke about a California firm, owned by Rezko friend Jay Wilton, delivering a $50,000 personal check to Blagojevich's campaign fund. The money had come in not long after the governor announced plans to allow Wilton's company to redevelop state tollway rest stops. The firm, Wilton Partners, then picked men with close ties to Rezko, including one named Al Chaib, to run two of the fast-food businesses that were planned for the redone “oases” on the tollway system.

Stuart Levine was also indicted on sweeping fraud charges, and federal subpoenas were issued to numerous people with ties to the administration, including Rezko. A few weeks later, Blagojevich was forced to acknowledge Rezko and Patti had been working together on real estate deals for eight years, a disclosure that began to increase scrutiny and ultimately hurt Patti's real estate business, River Realty.

A few months earlier, in the fall of 2004, federal investigators had not been actively and specifically targeting Rod Blagojevich himself, though their probe into Stuart Levine's various schemes was branching through the governor's administration and many agents had a sense of where things might lead.

The Levine investigation had started as a look at the possibility there was a rogue cell of corruption inside the administration. It was clear to investigators that Levine had help in high places from men like Rezko in the governor's inner ring of advisers, as well as from government insiders such as Cellini. But at first, they discovered precious little to implicate Blagojevich. The tape of Cellini mentioning “the big guy” was tantalizing but still provided no absolute evidence that the big guy was Blagojevich, or at least nothing that could be taken to a jury.

Investigators continued to work and follow what they had. They sifted through reports of fund-raising irregularities and hiring abuses. Word had circulated throughout the state's political channels about what kind of powerbrokers Rezko and Kelly were, and much of the talk had filtered to those trying to peel back the layers of Blagojevich's fund-raising organization.

Clues included Cellini also being taped talking to Levine about a roadbuilder he had vouched for to Kelly and who promised to do a fundraiser for Blagojevich. The business got a state contract but later backed out because of all of the chatter in the industry about getting state work in exchange for making contributions. Things were getting too open. Cellini had told Levine that law enforcement was sure to start sniffing around, and he had gone as far as telling Kelly to think about a cover story. If Kelly were ever asked about Cellini, he couldn't say he didn't know him if the feds had hundreds of calls between them show up in phone records.

Cellini and Levine talked about how Rezko and Kelly were doing things much more blatantly than the two of them had under prior Republican administrations.

“We would not call somebody after they got something or before they were gonna get something,” Cellini said. “As the general rule they do. That will set up a pattern that could be used and then all [the feds] gotta do is ask some of these people and these guys will cave in like a herd of turtles.”

But for all the reliance on taping and technology during the Levine probe and in the final acts of the probe years later, the early stage was more like a standard criminal investigation relying on the compiling of information and turning suspects into cooperators and cooperators into good witnesses. Investigators searched for intelligence and information, going as far as looking into unsubstantiated rumors of Blagojevich mistresses.

One of those turned by Niewoehner and those working with him was Levine. He was flatly informed even by his own attorneys that there was virtually nothing to do to blunt the evidence against him, and he was easily
facing spending the rest of his life in prison. He admitted what the government accused him of. The tapes compiled by investigators were nearly impossible to get around. He would tell them how he had the blessing of Blagojevich cronies to make illegal money at TRS and the health facilities board and that he believed Rezko and Kelly were doing things with the governor's knowledge and approval. After an early hiccup in his cooperation when he lied about schemes with Vrdolyak, Levine sat for more than three dozen sessions with investigators, spilling his secrets.

But just as pivotal was the cooperation of Joseph Cari.

In late 2004, Cari was only offering the feds documents showing his attempts to secure a consulting fee from JER. He was hopeful that he could ride out whatever storm was gathering around him. But he was wrong. The documents alone would not appease investigators.

During long criminal investigations, different people respond differently depending on who is doing the questioning, and so it was with the onetime national Democratic fundraiser. Cari was much more willing to bend when faced with a delivery of the facts by the formidable Reid Schar. The Stand-ford-educated Schar already had made a name for himself in the office of US Attorney Patrick Fitzgerald when he was brought in to be the “bad cop” of sorts to question Cari. He was the lead investigator in the case against Muhammad Salah, a Palestinian American accused of funding overseas terrorism.

Schar oozed the kind of harsh, no-nonsense intelligence and energy that put real fear into potential defendants. He was tall and had a shaved head and features that reminded some of a walking, talking federal eagle—and one that was more arrows than olive branch. To him, the US attorney's office was “the family,” and a perceived crossing of it brought righteous anger. Some lawyers in the case would derisively refer to Schar as “Chicago's one-man morality police” behind his back, but he was highly focused and seemingly always on task. And the evidence was on Schar's side.

The people Cari had threatened at JER were real victims, and he was the one who had tried to extort them. Schar quickly communicated that Cari was not going to get a free pass. There was no yelling, but Cari was told in no uncertain terms that he was going to be charged. There would be a real prosecution and real prison time if he chose to try his luck. He could help the government and the government would help him, or he could spin the wheel and wind up at a defense table with Levine and Rezko. In other words, you can either be on the train or under it.

And in early 2005, Cari gladly took his ticket.

He flipped, and he was to be the one to provide prosecutors with the first real evidence that Blagojevich could be going above and beyond what was allowable in the fund-raising arena. Cari described being on a flight with the governor in 2003, on Levine's private plane, no less. Chris Kelly was there, too. Cari had gotten the message that he could have just about anything he wanted if he were to dive in and help Blagojevich set up a national fund-raising apparatus for a presidential run. The governor was interested in raising a lot of money and didn't seem to have many scruples about how that happened. Bill Clinton, who had been governor of Arkansas, was a model for Blagojevich, who noted it was much easier for a sitting governor to raise the giant piles of cash necessary to run for the White House because he could give out contracts and all kinds of state business to help bring it in.

It was a watershed moment for investigators, who now had a firsthand account of Blagojevich talking about using the powers of his office to bring in campaign dollars. Their suspicions about Blagojevich were confirmed, and prosecutors and the FBI dug in for a long probe of how it might be happening.

By fall 2005, Joseph Cari was dropping a bombshell in court that for the first time publicly brought the investigation of corruption right into the governor's office and campaign. Pleading guilty to the extortion scheme at TRS, Cari acknowledged that state pension business was steered by two associates to favored companies in exchange for campaign contributions to a high-ranking public official described in court documents only as “Public Official A.”

Several news outlets quickly identified the two associates as Rezko and Kelly and “Public Official A” as Blagojevich. The following day, Blagojevich held a press conference at the Southeast Asian Center on North Broadway in Chicago to discuss state programs to help needy seniors heat their homes during the upcoming winter. But the heat was entirely on the governor, as dozens of reporters and television news crews jammed inside a small former restaurant to ask Blagojevich if he was “Public Official A.”

“Thank you for caring about the poor who need help,” Blagojevich deadpanned before reporters launched into thirty minutes of questions. “I don't know who A, B, C, or Z is,” he continued. “I have on my side the most
powerful ally that exists and that is the truth … and the truth is that we do things legally. We do things ethically. And we do things right.”

At one point during the flurry of questions, an elderly immigrant woman attending the event scolded the media for not asking questions about senior heating. With a smile on his face, Blagojevich placed the woman between himself and the reporters. “That's right,” he said.

Blagojevich may have thought he dodged a bullet. But a month later the
Tribune
disclosed that a federal grand jury had launched an investigation into Blagojevich's hiring practices, specifically Joe Cini's shop.

Even Blagojevich's friends were getting in trouble. The feds were subpoenaing records tied to David Wilhelm's venture capital firm, Hopewell Ventures, which had teacher fund business. Dan Stefanski earlier in the year was arrested for drunk driving, which looked bad since he had a six-figure salary working for the Department of Transportation. And Bamani Obadele was forced to resign from his job with the Department of Children and Family Services after an internal investigation discovered he had steered tens of thousands of dollars in state cash to companies he had a stake in.