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 Robert Williams, the chief financial officer at Rezko's development
company, Rezmar, said he wrote Patti's real estate company, River
Realty, the $40,000 check in January 2004 at Rezko's behest.
Williams was immediately skeptical of the order, he told jurors on
Thursday during the federal corruption trial of former Illinois Gov.
Rod Blagojevich.
Williams said Rezko asked him to deposit a check
of the same amount into a Rezmar account before transferring the
money to River Realty. Rezko said the money was earned through a
project at Lake and Aberdeen -- a project Williams had never heard
of.
William said he took particular notice of the dollar amount
associated with the check. He was aware that the Blagojevichs were
in the process of renovating their home and had fallen behind on
their payments to the builders -- who were subcontractors for Rezko.
Still, he signed the check.
IRS agent Shari Schindler testified that the check was
immediately transferred to the family's personal account. By Jan.
23, the $38,000 was sent to the subcontractors.
Williams said he was first ordered to draft an allegedly phantom
check for the former first lady in August 2003 for a real estate
transaction. He testified that he soon discovered Patti was not a
party to any Rezmar transaction. Williams let his boss know what he
thought of the payment, refusing to sign the $14,000 check.
"I told him I didn't believe it was appropriate to sign the
check," he said.
But the $14,000 check was small potatoes compared to what he said
was to come.
Within two months, Williams said he was sending $12,000 monthly
consulting fees to Patti until May 2004.
Former Rezmar consultant Mike Winter said the payment plan was an
odd one, since Patti's role was largely limited to brokerage. She
helped to identify potential realtors for one deal, which later fell
through during the spring of 2004. Rezko still issued her a check.
"They are generally only compensated after sales events ...
instead of taxing the company on a monthly basis," he began before
an objection cut short his response.
The Blagojevichs salaries peaked in 2004 -- the year Rezko's
checks flowed in -- at nearly $400,000, though Patti and Rod's
combined salaries never dipped below $226,000, the figure for 2008,
the year prosecutors allege Blagojevich attempted to sell President
Barack Obama's U.S. Senate seat.
And the prosecution believes they know why.
Blagojevich often complained that his $170,000 salary created
financial troubles for him, all the while spending more on clothing
than on his mortgage.
Rod and Patti spent more than $400,000 on clothing -- nearly
$10,000 more than the mortgage for their north Chicago home -- in
the six years the governor was in office.
On FBI wiretaps, Blagojevich often spoke of the financial
well-being of his family and his daughters' ability to attend
college -- typical worries for any parent.
"I don't wanna be in government after two years," he told adviser
Bill Knapp in a conversation about filling Obama's Senate seat.
"It's screwing my family. ... We're struggling financially."
[to top of second column] |
But Blagojevich's financial troubles apparently were largely of
his own doing.
IRS agent Shari Schindler read off a list of the who's who among
clothiers and retail outlets. The governor spent $205,000 on suits
from Tom James Clothing/Oxxford -- a custom clothing, custom
suit-maker. But that was just one component of his well-kept
wardrobe. The governor spent $2,000 for custom shirts and once left
Sak's Fifth Avenue with four ties worth $773.
The credit card statements also showed a lengthy list of returns
shortly after some shopping sprees. One $763 trip to Bloomingdale's
for ties was followed with a $359 return.
If Patti was behind the return trip, her frugality only went so
far. Patti paid around $3,000 for Maximilian Furs at a time.
Maximilian salons are located in Bloomingdale's stores and offer
premier designer furs.
Schindler testified that by August 2008, the Blagojevich family
owed more than $90,000 in credit card debt, as well as $220,000 on a
home equity loan.
The spending left the Blagojevich family with serious money
issues despite the governor's six-figure income. The first family
managed to consistently spend more money than they were bringing in,
leaving them with six-figure debt levels at the time of his arrest.
The prosecution is trying to paint a picture of a desperate man,
willing to risk corruption to preserve his financial well-being and
exorbitant lifestyle.
Lead defense attorney Sam Adam Jr. challenged Williams' claim
that the money was unearned. The former Rezmar executive admitted
that he had not discussed the agreement with Patti, nor did he check
with Rezko about consulting updates provided by the former first
lady.
"Were you privy to Patti and Mr. Rezko's conversations?" the
attorney asked.
"No," Williams replied.
"Is it fair to say that only two people, Rezko and Patti, can
tell what was said?" Adam followed up.
Williams affirmed the defense attorney's assumption.
Rezko was convicted on a bevy of corruption charges in 2008. He
became the face of political corruption in Illinois, especially
tainting Blagojevich. The businessman had been one of the governor's
chief fundraisers and key advisers.
Blagojevich now faces more than 400 years in prison if convicted
of a slew of corruption charges of his own.
The prosecution's case is winding down, and the government has
called many of its star witnesses. U.S. Attorney Reid Schar said the
prosecution will likely rest within two weeks. The judge has given
the defense until Wednesday to submit transcripts for audio
recordings it plans to use.
The defense has previously motioned to have all of the FBI
wiretaps played for the court. Federal Judge James Zagel rebuked the
request.
[Illinois
Statehouse News; By BILL McMORRIS]
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