Blago former fundraiser gets 3 years in prison

[March 19, 2010]  CHICAGO (AP) -- Ousted Illinois Gov. Rod Blagojevich's former chief fundraiser was sentenced Monday to three years in prison for hiding the use of his company's money to pay thousands of dollars in gambling debts and other expenses.

Christopher G. Kelly, 50, who was a key member of Blagojevich's inner circle, also was fined $7,500 and ordered to pay more than $600,000 in restitution to the federal government.

"I need the sentence to reflect the seriousness" of the crime, U.S. District Judge Elaine E. Bucklo said in handing down the 37-month sentence.

As head of the campaign fund, Kelly helped Blagojevich raise millions of dollars to bankroll his races for governor. Along with convicted influence-peddler Tony Rezko, Kelly emerged as one of Blagojevich's top advisers.

The tax case is separate from the one in which Kelly and Blagojevich are charged with federal racketeering conspiracy, but prosecutors hope Kelly will share his inside knowledge of the former governor's administration. He might prove a highly persuasive witness if Blagojevich goes to trial.

But there is no sign that Kelly has been anything but silent so far concerning the wave of corruption that has engulfed state government in recent years.

Not only is the Democratic Blagojevich facing charges that could sent him to prison for years but his immediate predecessor, Republican George Ryan, is serving a 6 1/2-year sentence for his own corruption wave.

Kelly, of suburban Burr Ridge, pleaded guilty in January to concealing his use of funds from his roofing company to pay thousands of dollars in gambling debts and personal expenses. He said Monday he was "deeply sorry" and "embarrassed by my actions" which led to charges that he had obstructed the Internal Revenue Service and illegally structured cash withdrawals to hide how much money he was taking from the company.

Bucklo allowed Kelly to remain free on bond pending another trial, set for September, in which he is charged with paying an unnamed consultant $450,000 in kickbacks to get $8.5 million in inflated roofing contracts from two airlines at O'Hare International Airport.

It is in a third case that Kelly is charged with Blagojevich in an alleged racketeering conspiracy to use the political muscle of the governor's office to squeeze individuals and businesses for cash and campaign donations.

Kelly has pleaded not guilty to the O'Hare and racketeering charges. Blagojevich also has pleaded not guilty to racketeering.

After the sentencing, Kelly and his attorneys marched out of the downtown courthouse in silence, trailed by a horde of photographers while prosecutors declined to comment.

Kelly not only tapped company funds to pay his gambling debts but also to pay $700,000 for part of his house and to pay for furnishings that included hardwood floors, draperies, landscaping, electronic equipment and other items.

Chief defense counsel Michael D. Monico said that Kelly eventually paid taxes on the money for the house. But he acknowledged that Kelly wrote off as business expenses payments for furnishings at the house, thus illegally cutting his client's tax bill.

Monico had argued for a shorter prison term, saying it was "grossly excessive to give a sentence of more than three years when the amount of tax money missing was less than 10 percent" of what he owed.

He also said that in the six years that prosecutors say the obstruction scheme went on, Kelly paid $4 million in taxes.

But Assistant U.S. Attorney Reid Schar scoffed at such claims.

"It's particularly troubling to hear, 'Well, he paid a lot of taxes anyway, so what's the big deal?'" Schar said.

[Associated Press; By MIKE ROBINSON]

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