Fundraiser emerges as key event in Illinois probe

[December 13, 2008]  CHICAGO (AP) -- A fundraiser held by Indian-American businessmen three days before Illinois Gov. Rod Blagojevich was arrested on corruption charges emerged Friday as a potentially key event in the federal investigation into whether he tried to sell President-elect Barack Obama's vacant Senate seat.

Questions are being raised about last Saturday's event for Blagojevich because Rep. Jesse Jackson Jr.'s brother, Jonathan, was among those attending. The Indian community has a long history of supporting the Jackson family's political aspirations, and the congressman has been clear about his interest in succeeding Obama.

Rep. Jackson, however, flatly denied that he or his brother were involved in a scheme for Blagojevich to peddle the Senate seat in return for up to $1.5 million in political contributions.

The congressman also said neither his brother nor his father, the Rev. Jesse Jackson, served as any kind of emissary for discussions with the governor.

"Clearly, a scheme had been hatched in the mind of the governor," Jackson said.

The Chicago Tribune reported Friday that some of the businessmen who gathered at the Dec. 6 fundraiser discussed the prospect of raising at least $1 million for the governor in return for Jackson getting the Senate seat.

Iftekhar Shareef, former president of the Federation of Indian Associations and a prominent businessman, said he attended the fundraiser and sat at the same table as the governor, Jonathan Jackson and at least two prominent Indian businessmen.

Nobody discussed the Senate seat at the table, Shareef said.

"Honestly, I never saw if there was any talk about Jesse Jr.'s Senate seat or anything," Shareef said. "Who knows? It might be among themselves."

Blagojevich was arrested at his home Tuesday, one day after he met with Jackson for 90 minutes to discuss Jackson's interest in the seat. The congressman has been identified as "Senate Candidate 5" in the federal complaint against Blagojevich.

Jackson said Blagojevich never promised him the Senate seat. "Far from it," he told The Associated Press. "It was clear from the reading of the complaint, my candidacy never had a chance under his process."

Any scheme to win Jackson the appointment may have been hatched shortly before Oct. 31, according to the complaint.

During a recorded conversation that day, the governor recalled "an earlier approach" by an associate of Senate Candidate 5: "We were approached 'pay to play.' That, you know, he'd raise me 500 grand. An emissary came. Then the other guy would raise a million, if I made him a senator."

The Tribune reported that Blagojevich made an appearance at an Oct. 31 luncheon at the India House restaurant in suburban Schaumburg, an event sponsored by businessman Raghuveer Nayak.

Ravi Rawat, manager of the India House restaurant, said there were 35 participants at the luncheon and that Nayak paid the bill. He said he was unaware of what was discussed at the closed-door session, though Shareef said it was held to plan last week's Blagojevich fundraiser.

According to state campaign finance reports, Nayak and his company, Rogers Park One Day Surgi-Center, gave $117,000 to Blagojevich's campaign fund from 2001 through November 2006.

Raghuveer and Anita Nayak also contributed $20,300 to Jackson's campaigns from 2000 to 2008, Federal Election Commission documents indicate.

At least two other businessmen and a Blagojevich aide identified as being part of Saturday's fundraiser have donated to Blagojevich and Jackson, sometimes with their wives.

Harish and Renuka Bhatt have given $86,000 to Blagojevich, including $4,000 from the Association of Indian Pharmacists, which lists the same address as Bhatt.

Blagojevich has also received $18,500 from Babu Patel or his firm, Patel Realty, from 2000 through June. Patel gave $1,000 to Jackson in 2007. Blagojevich aide Rajinder Bedi gave Jackson $500 between 2005 and 2008.

According to Shareef, both Nayak and Bedi sat with the governor and Jonathan Jackson during the fundraiser.

Messages left with Nayak, the Bhatts, Patel and Bedi were not returned Friday.

On Dec. 4, two days before the fundraiser, prosecutors say Blagojevich told someone identified only as "Adviser B" that he was giving Jackson greater consideration for the seat because, "among other reasons," he would raise money for a Blagojevich re-election run and might even provide some cash upfront.

In another taped call, Blagojevich said he was elevating Jackson on his list of candidates because he "might be able to cut a deal" that could give the governor "something tangible up front."

"Blagojevich noted he was going to meet with 'Senate Candidate 5' in the next few days," the complaint says.

In fact, the governor and Jackson met to discuss the Senate seat four days later, on Monday. Blagojevich was arrested at his home the next morning.

[Associated Press; By ADAM GOLDMAN and RICHARD T. PIENCIAK]

Associated Press writers John O'Connor, Michael Tarm, Karen Hawkins and researcher Susan James in New York contributed to this story.

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