FBI: Blago equated politics with fundraising

[July 07, 2010]  CHICAGO -- Rod Blagojevich told FBI agents in a 2005 interview that they had little to worry about; he had a "firewall" in place to separate governance from fundraising.

But those words provided little comfort to those the former Illinois governor allegedly tried to shake down.

Prosecutors introduced the jury to one of his alleged targets, road builder and former fundraiser Gerry Krozel. He testified that Blagojevich, his brother and co-defendant Rob Blagojevich, and Lon Monk approached him in September 2008 with a proposition.

The governor had been fixating on the idea of a multibillion-dollar tollway construction project, at a time when the state was strapped for cash, making legislators less than eager to add to the budget. Blagojevich allegedly assured Krozel he had a way around the General Assembly -- but it came at a price.

"We started talking about additional (tollway projects); he asked me to raise money for the tollway," Krozel said. "I understood that the fundraising would probably determine the validity of the project."

The story backed up what federal authorities had long suspected.

"He equated politics with fundraising," FBI supervising special agent Pat Murphy testified on Tuesday morning. "(But) he said ... when he became governor he took himself out of that loop."

Former fundraiser Kelly Glynn said Blagojevich handled fundraising with a careful and discerning eye, referring to disappointing donors like Chicago businessman Blair Hull as a "bullsh--er."

Another former fundraiser, Danielle Stillz, said Blagojevich "regularly attended" fundraising discussions involving specific references to donors.

Murphy said the FBI had been tipped off to possible corruption within the Blagojevich administration in October 2004 by former Democratic National Committee fundraising chair Joe Cari, who accompanied the governor to a New York fundraiser on a private jet chartered by embattled Chicago businessman Stuart Levine.

"(Blagojevich) said that he would be giving out state business and would go back to those people for contributions," Cari testified in June.

Blagojevich is facing charges of lying to federal investigators in the 2005 interview. The defense is arguing that he was never asked directly about the incident, giving him no opportunity to lie. But Blagojevich's attorneys will have a harder time divorcing their claim from the words of his former fundraisers.

Blaojevich attorney Sam Adam Jr. did try to raise credibility questions about Cari and Murphy. The agent admitted Cari did not bring up the airplane conversation to the FBI in "four or five" previous meetings with federal agents.

Cari also testified in exchange for a reduced sentence on an extortion charge in connection with the Illinois Teachers’ Retirement System. The defense has pointed to prosecution plea deals to discredit cooperating witnesses and former Blagojevich associates.

The former governor's dealing with the FBI has certainly changed over the years.

When the airplane conversation brought federal investigators to Blagojevich's door, it may have seemed a fortress. He had directed millions in campaign funds to retain the services of Winston & Strawn, the high-powered white-collar defense firm. Blagojevich and his attorney, firm partner Brad Lerman, chatted with the agents for three hours but had managed to convince the government to leave the recording devices at home -- a far cry from the nearly endless stream of tapes his defense attorneys must now confront.

Regarding a move that could only be called shortsighted, Stillz testified that Blagojevich ordered her to delay payments to the white-collar crime specialists at the firm as bills piled up.

"We did not want to reflect a high legal bill on the D-2s (the semiannual campaign fund report)," she said.

Stillz wasn't kidding. Records show Friends of Blagojevich sent nearly $2 million to the firm in 2006 and 2007, including $965,000 in 2007.

The firm has strong ties to the governor's mansion. It was run by former Gov. Jim Thompson and would go on to unsuccessfully defend Blagojevich's Republican predecessor George Ryan in his corruption trial.

If convicted of his own corruption charges, Blagojevich could join Ryan in prison -- and surpass him by more than 400 years.

[Illinois Statehouse News; By BILL McMORRIS]