Alexi Giannoulias
Encyclopedia
Alexander "Alexi" Giannoulias (əˈlɛksi dʒəˈnuːli.əs; or jeh-NOO'-lee-us) (born March 16, 1976) is an American politician who served as Illinois Treasurer from 2007 to 2011. A Democrat
, Giannoulias defeated Republican
candidate State Senator
Christine Radogno
in November 2006 with 54 percent of the vote, becoming the first Democrat to hold the office in 12 years and, at the age of 30, the youngest State Treasurer in the nation.
On July 26, 2009, Giannoulias announced his candidacy in the 2010 election
for the seat in the United States Senate
held by Roland Burris
. Burris, who was appointed by Governor
Rod Blagojevich
to fill the seat vacated by Barack Obama
following Obama's election
as President of the United States
, chose not to seek election. Giannoulias won the Democratic primary on February 2, 2010, then faced Republican
Mark Kirk
as well as Green Party candidate
LeAlan Jones
and Libertarian
Michael Labno in the general election in November 2010. Kirk won the election.
to Greek immigrants. His mother, Anna, is from Chania
, and his late father, Alexis, was from Kalavryta
. He has two older brothers, Demetris and George. Giannoulias attended The Latin School of Chicago
and then the University of Chicago before transferring to Boston University
. Giannoulias graduated cum laude with a bachelor’s degree in economics. He then moved to Greece to play basketball with Panionios B.C. for a year (1998–99).
Giannoulias had played basketball at The Latin School of Chicago
, and played Division III basketball at the University of Chicago. Giannoulias was named to the America East Conference
Academic Honor Roll each of the two years he played at Division I Boston University
After returning from Greece, Giannoulias attended Tulane University Law School
. Upon earning his law degree, Alexi returned to Chicago to help manage Broadway Bank
, a community bank in Chicago's Edgewater neighborhood that was founded by his father in 1979.
Giannoulias served on the board of directors of the Community Banker’s Association of Illinois Legislative Committee, the South Side/Wabash YMCA, and the Edgewater
Chamber of Commerce. Giannoulias also founded and chaired the AG Foundation, a not-for-profit charity that donated money to treat child-related illnesses, curb poverty and assist disaster relief organizations.
.
The Chicago Sun-Times news group also endorsed Giannoulias in the general election, arguing that he would “bring valuable private enterprise experience from banking to the job” and praising his “creative” policy proposals like a securities-lending program, improving Bright Start, and promoting green energy. Running on a campaign platform that emphasized comprehensive ethics reform for the Treasurer’s office, Giannoulias won the March 2006 primary and went on to defeat Republican candidate Christine Radogno in the general election.
and Collinsville
.
to cooperate in the sale of Chicago-based clothing manufacturer Hartmarx
Corp., which was at risk of liquidation and had filed for Chapter 11 protection. The success of this sale with Giannoulias’ support saved over 600 jobs at an Illinois Hartmarx factory that otherwise would have been closed.
Wells Fargo, a primary lender for Hartmarx, is also “the money custodian for the treasurer’s office, holding its cash and other financial assets." Giannoulias publicly challenged Wells Fargo’s obstruction of the sale, stating that “[Wells Fargo’s] intention to liquidate Hartmarx rather than allow a sale to buyers intent on keeping the company running will significantly jeopardize the business relationship between Wells Fargo and the state of Illinois.”
Giannoulias cited the fact Wells Fargo received over $25 billion in federal TARP bailout funds as further reason why the bank should have supported the sale of Hartmarx instead of pursuing the company’s liquidation. In a public statement, Giannoulias said, "We expect companies that get state and federal taxpayer money to invest it in American jobs and American workers, not destroy companies that still have a chance to succeed."
or other fuel-efficient
vehicle.
purchased $10 million worth of Israel Bonds
. Giannoulias said: "This is a good way to safely diversify our portfolio, especially during a time when some of our other investment options aren't generating as much revenue because of the market fluctuations here in the United States." According to Giannoulias, the Israel Bonds will mature in three years with a 2.43% rate of return, compared to U.S. government bonds yielding a 1.51% return during the same period.
The Fallen Heroes Scholarship Program, which Giannoulias designed in a partnership with the Illinois Department of Veterans Affairs
, awards an initial investment of $2,500 in college savings to children who have lost a parent in military service since 2001.
In 2008, Giannoulias announced the creation of the Bright Start Scholarship Program, which will award $3.5 million in need-based scholarships over 7 years, until 2015. More than 250 students received scholarships in 2008, the first year of the program. The scholarships were designed by Giannoulias as a public–private partnership, with the funding for the scholarships donated by a private firm at no cost to the state or taxpayers. Giannoulias also developed the Cultivate Illinois Excellence in Agriculture scholarship in 2008. This program awards ten $2,000 scholarships each year to students pursuing degrees in agriculture-related fields.
In 2008, one of the twenty-one funds in Bright Start, Core Plus, began experiencing excessive losses and eventually lost 38% of its value. In the same year, the overall Bright Start program’s benchmark grew by 5.4%. Within the Illinois Bright Start program, 2.5% of investors had invested their entire portfolios in Core Plus and suffered a 38% loss; others experienced smaller losses.
As the Associated Press reported, "It turns out the Oppenheimer team handling Core Plus — a team the company has now fired — was putting money into risky, complicated investments that tanked in 2008 amid the general financial meltdown." In 2009, Oregon, Nebraska, New Mexico, Texas, Maine and Illinois all investigated OppenheimerFunds’ handling of the their college savings programs for impermissible investments and misconduct. Oppenheimer was selected to lead the program by Giannoulias' predecessor, former Illinois Treasurer Judy Baar Topinka
, in December 2006, a month before Giannoulias took office.
After the credit markets collapsed in the fall, new contributions into the fund were halted on December 4, 2008. In January 2009, the treasurer’s office announced that no further contributions would be made to the Core Plus fund and that the state would be investigating the losses.
According to the Associated Press, Illinois was the first state to take action. In January 2009, at the request of Giannoulias, the Illinois Attorney General
initiated its own probe of OppenheimerFunds, issuing subpoenas on the company. At the time, the losses attributable to OppenheimerFunds' impermissible investments were estimated to be "in excess of $85 million."
Despite the problem associated with OppenheimerFunds' handling of Core Plus, Bright Start remains a highly-regarded 529 college savings program. In April 2009, Consumer Reports studied college savings programs across the country “to see how well they performed during last year’s stock-market plunge.” Consumer Reports “found five that are worthy of an A,” and ranked Bright Start as one of the top five college savings programs in the nation. In April 2009, Money Magazine
selected Bright Start as one the “best low-risk 529 plans.” In December 2009, Kiplingers selected Bright Start as one of the best state 529 plans in the country, choosing it as the best plan for “low fees.” Morningstar, Inc.
, which had previously ranked Bright Start in its top 5 in 2008, has acknowledged the issues relating to Core Plus but, citing Illinois’ swift action in dealing with the issue, reported in 2009 that “the plan still holds plenty of appeal.”
In December 2009, the Illinois Attorney General's Office and the Office of the State Treasurer announced that Illinois had reached a settlement with OppenheimerFunds. Eligible accountholders who lost money in Core Plus would receive $77 million from OppenheimerFunds. As the scope of the settlement was expanded during negotiations with OppenheimerFunds to include more accountholders, the total loss addressed by the settlement is $150 million. The payout from this settlement brings the losses for the 2.5% of Bright Start investors who were fully invested in Core Plus down to 17%.
The Treasurer's Office used some of the investment fees from the Bright Start program to purchase a hybrid vehicle to "so Bright Start staff have a way to travel the state and sign families up for the program" and used to promote other Treasurer's Office programs. The vehicle was never used for personal use by Giannoulias.
es on eBay, scrapping the state's annual live auctions.
, a community bank founded by his father. When he left the bank in 2006, it was one of the most profitable banks in Illinois. Four years later, on January 26, 2010, Broadway Bank entered into a consent decree with the FDIC that ordered Broadway to increase its capital.ur Two dozen small- to medium-sized banks in Illinois and nearly 200 banks nationwide have failed since the October 2008 economic crash.
Broadway Bank’s struggling financial situation is due to delinquent real estate loans and foreclosed properties. From 2002 to 2006, Broadway’s lending in construction and development loans increased sixfold, to $356 million. During Giannoulias’ tenure, Broadway also increased its brokered deposits, which generally command high interest rates. When Giannoulias left the bank in 2006, brokered deposits made up 80% of all deposits at Broadway. When the housing market crashed in late 2008, commercial real estate loan performance deteriorated and Broadway Bank, which had focused its lending in real estate, suffered.
Nine percent of the value of the bad loans originated while Giannoulias was chief loan officer.:1
At the end of business on Friday, , the Illinois Department of Financial and Professional Regulation
, Division of Banking, seized Broadway Bank and appointed the Federal Deposit Insurance Corporation
(FDIC) as receiver
. The FDIC in turn named MB Financial Bank as the institution receiving Broadway Bank's deposit accounts. The FDIC announced that it and MB Financial Bank would share $878.4 million in losses, for a cost of $394.3 million to the federal Deposit Insurance Fund
.ur
, a political fundraiser and real estate developer who was later convicted of fraud and money laundering. Broadway Bank made these loans before Rezko was investigated, indicted, or convicted for any crimes. Before his conviction, Rezko also received loans from other Chicago banks, including Bank of Chicago, First Bank and Trust of Illinois, GE Capital, Harris Trust and Savings, LaSalle Bank, and Manufacturers Bank.
Giannoulias himself did not make the Rezko loans.
Rezko defaulted on loans made by Broadway, and, in 2006 Broadway was the first bank to foreclose on one of Rezko’s delinquent loans, forcing him to declare bankruptcy. Broadway Bank also refused to cover nine bad checks written by Rezko for a total of $450,000 in early 2008
Giannoulias never accepted campaign contributions from Rezko.
Broadway Bank also loaned money for real estate developments to Michael Giorango, who has been convicted for prostitution and bookmaking. Giannoulias has stated that he was not part of the loan committee that approved the loans to Giorango.
, Green Party nominee LeAlan Jones
, and Libertarian nominee Mike Labno.
On March 2, 2009, Giannoulias stated on CNBC that he was forming an exploratory committee
in order to assess a potential candidacy for the US Senate in 2010. On July 26, 2009, he officially announced his candidacy for the United States Senate at the Hilton Chicago
, the same place then-Senator Barack Obama endorsed Giannoulias for State Treasurer in 2006. He was introduced to the crowd by Congressman Bill Foster
.
Giannoulias was elected the Democratic nominee for US Senate in Illinois in the February 2, 2010 primary, with 39.0% of the vote. David H. Hoffman
received 33.8% and Cheryle Jackson received 19.7%.
, the Service Employees International Union
(SEIU), AFSCME, the AFL-CIO
, the League of Conservation Voters
, the Human Rights Campaign
, the Chicago Sun-Times
, and the Sierra Club
(Planned Parenthood, the League of Conservation Voters, and the Human Rights Campaign had all supported Congressman Kirk in previous races).
On May 28, 2010, the Human Rights Campaign
(HRC) endorsed Giannoulias, calling him "a strident supporter of LGBT equality – including supporting marriage equality, repeal of the Defense of Marriage Act, repeal of “Don’t Ask, Don’t Tell” and supporting an inclusive Employment Non-Discrimination Act."
U.S. Senator Dick Durbin, the Assistant Majority Leader and second-highest ranking Democrat in the Senate, endorsed Giannoulias and served as the chairman of the Giannoulias campaign.
President Obama expressed his support of Giannoulias’ Senate bid and joined him on the campaign trail.
Democratic Party (United States)
The Democratic Party is one of two major contemporary political parties in the United States, along with the Republican Party. The party's socially liberal and progressive platform is largely considered center-left in the U.S. political spectrum. The party has the lengthiest record of continuous...
, Giannoulias defeated Republican
Republican Party (United States)
The Republican Party is one of the two major contemporary political parties in the United States, along with the Democratic Party. Founded by anti-slavery expansion activists in 1854, it is often called the GOP . The party's platform generally reflects American conservatism in the U.S...
candidate State Senator
Illinois Senate
The Illinois Senate is the upper chamber of the Illinois General Assembly, the legislative branch of the government of the state of Illinois in the United States. The body was created by the first state constitution adopted in 1818. The Illinois Senate is made up of 59 senators elected from...
Christine Radogno
Christine Radogno
Christine Radogno is a Republican member of the Illinois Senate, representing the 41st Legislative District in Cook, DuPage, and Will counties since 1997. She currently serves as the Minority Leader, the first woman leader of a political party in the Senate....
in November 2006 with 54 percent of the vote, becoming the first Democrat to hold the office in 12 years and, at the age of 30, the youngest State Treasurer in the nation.
On July 26, 2009, Giannoulias announced his candidacy in the 2010 election
United States Senate elections in Illinois, 2010
The 2010 United States Senate elections in Illinois took place on November 2, 2010. There were 2 ballot items for the same seat: a routine one, to fill the Class 3 seat beginning with the 112th United States Congress beginning on January 3, 2011, and a special item, to fill that seat for the final...
for the seat in the United States Senate
United States Senate
The United States Senate is the upper house of the bicameral legislature of the United States, and together with the United States House of Representatives comprises the United States Congress. The composition and powers of the Senate are established in Article One of the U.S. Constitution. Each...
held by Roland Burris
Roland Burris
Roland Wallace Burris is a former United States Senator from the state of Illinois and a member of the Democratic Party....
. Burris, who was appointed by Governor
Governor of Illinois
The Governor of Illinois is the chief executive of the State of Illinois and the various agencies and departments over which the officer has jurisdiction, as prescribed in the state constitution. It is a directly elected position, votes being cast by popular suffrage of residents of the state....
Rod Blagojevich
Rod Blagojevich
Rod R. Blagojevich is an American politician who served as the 40th Governor of Illinois from 2003 to 2009. A Democrat, Blagojevich was a State Representative before being elected to the United States House of Representatives representing parts of Chicago...
to fill the seat vacated by Barack Obama
Barack Obama
Barack Hussein Obama II is the 44th and current President of the United States. He is the first African American to hold the office. Obama previously served as a United States Senator from Illinois, from January 2005 until he resigned following his victory in the 2008 presidential election.Born in...
following Obama's election
United States presidential election, 2008
The United States presidential election of 2008 was the 56th quadrennial presidential election. It was held on November 4, 2008. Democrat Barack Obama, then the junior United States Senator from Illinois, defeated Republican John McCain, the senior U.S. Senator from Arizona. Obama received 365...
as President of the United States
President of the United States
The President of the United States of America is the head of state and head of government of the United States. The president leads the executive branch of the federal government and is the commander-in-chief of the United States Armed Forces....
, chose not to seek election. Giannoulias won the Democratic primary on February 2, 2010, then faced Republican
Republican Party (United States)
The Republican Party is one of the two major contemporary political parties in the United States, along with the Democratic Party. Founded by anti-slavery expansion activists in 1854, it is often called the GOP . The party's platform generally reflects American conservatism in the U.S...
Mark Kirk
Mark Kirk
Mark Steven Kirk is the junior United States Senator from Illinois and a member of the Republican Party. Previously, Kirk was a member of the United States House of Representatives, representing Illinois's 10th congressional district....
as well as Green Party candidate
Green Party (United States)
The Green Party of the United States is a nationally recognized political party which officially formed in 1991. It is a voluntary association of state green parties. Prior to national formation, many state affiliates had already formed and were recognized by other state parties...
LeAlan Jones
LeAlan Jones
LeAlan Marvin Jones is an American journalist and the Green Party's 2010 nominee for United States Senate from Illinois. Jones lives in Chicago's Auburn/Gresham Community.Jones' radio documentaries have received critical acclaim and numerous awards...
and Libertarian
Libertarian Party (United States)
The Libertarian Party is the third largest and fastest growing political party in the United States. The political platform of the Libertarian Party reflects its brand of libertarianism, favoring minimally regulated, laissez-faire markets, strong civil liberties, minimally regulated migration...
Michael Labno in the general election in November 2010. Kirk won the election.
Background
Giannoulias was born in ChicagoChicago
Chicago is the largest city in the US state of Illinois. With nearly 2.7 million residents, it is the most populous city in the Midwestern United States and the third most populous in the US, after New York City and Los Angeles...
to Greek immigrants. His mother, Anna, is from Chania
Chania
Chaniá , , also transliterated Chania, Hania, and Xania, older form Chanea and Venetian Canea, Ottoman Turkish خانيه Hanya) is the second largest city of Crete and the capital of the Chania peripheral unit...
, and his late father, Alexis, was from Kalavryta
Kalavryta
Kalavryta is a town and a municipality in the eastcentral part of the peripheral unit of Achaea, Greece. It is the southern terminus of the Kalavryta - Diakopto Road and the eastern terminus of the Patras - Kalavryta Road. It is located approx...
. He has two older brothers, Demetris and George. Giannoulias attended The Latin School of Chicago
The Latin School of Chicago
The Latin School of Chicago is a private elementary, middle and high school in the Gold Coast neighborhood in Chicago. The school was founded in 1888 by Mabel Slade Vickery.- History :...
and then the University of Chicago before transferring to Boston University
Boston University
Boston University is a private research university located in Boston, Massachusetts. With more than 4,000 faculty members and more than 31,000 students, Boston University is one of the largest private universities in the United States and one of Boston's largest employers...
. Giannoulias graduated cum laude with a bachelor’s degree in economics. He then moved to Greece to play basketball with Panionios B.C. for a year (1998–99).
Giannoulias had played basketball at The Latin School of Chicago
The Latin School of Chicago
The Latin School of Chicago is a private elementary, middle and high school in the Gold Coast neighborhood in Chicago. The school was founded in 1888 by Mabel Slade Vickery.- History :...
, and played Division III basketball at the University of Chicago. Giannoulias was named to the America East Conference
America East Conference
The America East Conference is a NCAA Division I college athletic conference whose members are located mainly in the northeastern United States. The conference was known as the ECAC North from 1979 to 1988 and the North Atlantic Conference from the fall semester of 1988 to the end of the spring...
Academic Honor Roll each of the two years he played at Division I Boston University
Boston University
Boston University is a private research university located in Boston, Massachusetts. With more than 4,000 faculty members and more than 31,000 students, Boston University is one of the largest private universities in the United States and one of Boston's largest employers...
After returning from Greece, Giannoulias attended Tulane University Law School
Tulane University Law School
Tulane University Law School is the law school of Tulane University. It is located on Tulane's Uptown campus in New Orleans, Louisiana. Established in 1847, it is the 12th oldest law school in the United States....
. Upon earning his law degree, Alexi returned to Chicago to help manage Broadway Bank
Broadway Bank (Illinois)
Broadway Bank was a Chicago bank that existed from 1979 to 2010, and was owned by the Giannoulias family. Its financial situation and history of questionable loans are a factor in the campaign of Alexi Giannoulias in the 2010 U.S. Senate election in Illinois....
, a community bank in Chicago's Edgewater neighborhood that was founded by his father in 1979.
Giannoulias served on the board of directors of the Community Banker’s Association of Illinois Legislative Committee, the South Side/Wabash YMCA, and the Edgewater
Edgewater, Chicago
Edgewater is a lakefront community area in the North Side of the city of Chicago, Illinois seven miles north of the Loop. As one of Chicago’s 77 official community areas, Edgewater is bounded by Foster Avenue on the south, Devon Avenue on the north, Ravenswood Avenue on the west, and Lake Michigan...
Chamber of Commerce. Giannoulias also founded and chaired the AG Foundation, a not-for-profit charity that donated money to treat child-related illnesses, curb poverty and assist disaster relief organizations.
2006 campaign for Illinois State Treasurer
Although the state Democratic Party led by House Speaker Mike Madigan backed his opponent, Paul Mangieri, in the primary, Giannoulias was endorsed by U.S. Representatives Jan Schakowsky and Jesse Jackson, Jr. and by then-Senator Barack ObamaBarack Obama
Barack Hussein Obama II is the 44th and current President of the United States. He is the first African American to hold the office. Obama previously served as a United States Senator from Illinois, from January 2005 until he resigned following his victory in the 2008 presidential election.Born in...
.
The Chicago Sun-Times news group also endorsed Giannoulias in the general election, arguing that he would “bring valuable private enterprise experience from banking to the job” and praising his “creative” policy proposals like a securities-lending program, improving Bright Start, and promoting green energy. Running on a campaign platform that emphasized comprehensive ethics reform for the Treasurer’s office, Giannoulias won the March 2006 primary and went on to defeat Republican candidate Christine Radogno in the general election.
Ethics reform
On his 1st day as State Treasurer, Giannoulias "signed his own executive order to enact the most comprehensive, widest-ranging ethics package of any elected official in the state", according to his official state website. "The order prohibits [the Treasurer] from accepting contributions from banks, Treasurer’s Office employees and contractors who do business with the office." He also moved to foreclose on two debt-ridden hotels built in the 1980s by politically-connected insiders in SpringfieldSpringfield, Illinois
Springfield is the third and current capital of the US state of Illinois and the county seat of Sangamon County with a population of 117,400 , making it the sixth most populated city in the state and the second most populated Illinois city outside of the Chicago Metropolitan Area...
and Collinsville
Collinsville, Illinois
Collinsville is a city located mainly in Madison County, and partially in St. Clair County, both in Illinois. As of the 2010 census, the city had a population of 26,016. Collinsville is approximately 12 miles from St. Louis, Missouri and is considered part of that city's Metro-East area...
.
Hartmarx
In 2009, Giannoulias worked to encourage Wells FargoWells Fargo
Wells Fargo & Company is an American multinational diversified financial services company with operations around the world. Wells Fargo is the fourth largest bank in the U.S. by assets and the largest bank by market capitalization. Wells Fargo is the second largest bank in deposits, home...
to cooperate in the sale of Chicago-based clothing manufacturer Hartmarx
Hartmarx
Hart Schaffner Marx, founded in 1887 and incorporated in 1911, is an American manufacturer of tailored menswear. Its headquarters is at 101 North Wacker Drive, Chicago, Illinois. Hart Schaffner Marx is the flagship brand of HMX Group, a holding company that engages in the manufacture and marketing...
Corp., which was at risk of liquidation and had filed for Chapter 11 protection. The success of this sale with Giannoulias’ support saved over 600 jobs at an Illinois Hartmarx factory that otherwise would have been closed.
Wells Fargo, a primary lender for Hartmarx, is also “the money custodian for the treasurer’s office, holding its cash and other financial assets." Giannoulias publicly challenged Wells Fargo’s obstruction of the sale, stating that “[Wells Fargo’s] intention to liquidate Hartmarx rather than allow a sale to buyers intent on keeping the company running will significantly jeopardize the business relationship between Wells Fargo and the state of Illinois.”
Giannoulias cited the fact Wells Fargo received over $25 billion in federal TARP bailout funds as further reason why the bank should have supported the sale of Hartmarx instead of pursuing the company’s liquidation. In a public statement, Giannoulias said, "We expect companies that get state and federal taxpayer money to invest it in American jobs and American workers, not destroy companies that still have a chance to succeed."
Green Rewards
Giannoulias launched the "Green Rewards" program, which gives a $1,000 rebate to Illinois residents who purchase a new hybridHybrid vehicle
A hybrid vehicle is a vehicle that uses two or more distinct power sources to move the vehicle. The term most commonly refers to hybrid electric vehicles , which combine an internal combustion engine and one or more electric motors.-Power:...
or other fuel-efficient
Fuel efficiency in transportation
The fuel efficiency in transportation ranges from some hundred kilojoule per kilometre for a bicycle to several megajoule for a helicopter.Efficiency can be expressed in terms of consumption per unit distance per vehicle, consumption per unit distance per passenger or consumption per unit distance...
vehicle.
Purchase of Israel Bonds
In January 2009, the state of IllinoisIllinois
Illinois is the fifth-most populous state of the United States of America, and is often noted for being a microcosm of the entire country. With Chicago in the northeast, small industrial cities and great agricultural productivity in central and northern Illinois, and natural resources like coal,...
purchased $10 million worth of Israel Bonds
State of Israel Bonds
State of Israel Bonds are debt securities issued by the Government of Israel.State of Israel Bonds is also the more familiar name of the underwriter of the bonds in the United States. The company is officially known as Development Corporation for Israel...
. Giannoulias said: "This is a good way to safely diversify our portfolio, especially during a time when some of our other investment options aren't generating as much revenue because of the market fluctuations here in the United States." According to Giannoulias, the Israel Bonds will mature in three years with a 2.43% rate of return, compared to U.S. government bonds yielding a 1.51% return during the same period.
Scholarship programs
In addition to revamping the Bright Start savings program, Giannoulias created several new scholarship programs for Illinois college students.The Fallen Heroes Scholarship Program, which Giannoulias designed in a partnership with the Illinois Department of Veterans Affairs
Illinois Department of Veterans Affairs
-Mission:The mission of the Illinois Department of Veterans Affairs is to assist veterans and their dependents and survivors in obtaining the benefits they are entitled to under the laws of the United States, and the State of Illinois or any other governmental agency, through its forty-three...
, awards an initial investment of $2,500 in college savings to children who have lost a parent in military service since 2001.
In 2008, Giannoulias announced the creation of the Bright Start Scholarship Program, which will award $3.5 million in need-based scholarships over 7 years, until 2015. More than 250 students received scholarships in 2008, the first year of the program. The scholarships were designed by Giannoulias as a public–private partnership, with the funding for the scholarships donated by a private firm at no cost to the state or taxpayers. Giannoulias also developed the Cultivate Illinois Excellence in Agriculture scholarship in 2008. This program awards ten $2,000 scholarships each year to students pursuing degrees in agriculture-related fields.
Bright Start
As Illinois Treasurer, Giannoulias is responsible for overseeing the Illinois' Bright Start college saving program. Bright Start provides parents with the opportunity to invest in a tax-free account to save for their children's college education. Enrollees are eligible for several state tax benefits and can invest in various stock and bond options. Before Giannoulias took office, SavingForCollege.com ranked Bright Start 47th out of 48 in the nation. Giannoulias helped reform the program, and Bright Start went from being one of the worst programs in the country to one of the best. Morningstar called the transformation “a Cinderella story.”In 2008, one of the twenty-one funds in Bright Start, Core Plus, began experiencing excessive losses and eventually lost 38% of its value. In the same year, the overall Bright Start program’s benchmark grew by 5.4%. Within the Illinois Bright Start program, 2.5% of investors had invested their entire portfolios in Core Plus and suffered a 38% loss; others experienced smaller losses.
As the Associated Press reported, "It turns out the Oppenheimer team handling Core Plus — a team the company has now fired — was putting money into risky, complicated investments that tanked in 2008 amid the general financial meltdown." In 2009, Oregon, Nebraska, New Mexico, Texas, Maine and Illinois all investigated OppenheimerFunds’ handling of the their college savings programs for impermissible investments and misconduct. Oppenheimer was selected to lead the program by Giannoulias' predecessor, former Illinois Treasurer Judy Baar Topinka
Judy Baar Topinka
Judy Baar Topinka is the Illinois State Comptroller and former Illinois State Treasurer, having served as Treasurer from 1995 to 2007, and former chairwoman of the Illinois Republican Party. She was the first woman to become state treasurer, first to be elected to three consecutive terms and the...
, in December 2006, a month before Giannoulias took office.
After the credit markets collapsed in the fall, new contributions into the fund were halted on December 4, 2008. In January 2009, the treasurer’s office announced that no further contributions would be made to the Core Plus fund and that the state would be investigating the losses.
According to the Associated Press, Illinois was the first state to take action. In January 2009, at the request of Giannoulias, the Illinois Attorney General
Illinois Attorney General
The Illinois Attorney General is the highest legal officer of the state of Illinois in the United States. Originally an appointed office, it is now an office filled by election through universal suffrage...
initiated its own probe of OppenheimerFunds, issuing subpoenas on the company. At the time, the losses attributable to OppenheimerFunds' impermissible investments were estimated to be "in excess of $85 million."
Despite the problem associated with OppenheimerFunds' handling of Core Plus, Bright Start remains a highly-regarded 529 college savings program. In April 2009, Consumer Reports studied college savings programs across the country “to see how well they performed during last year’s stock-market plunge.” Consumer Reports “found five that are worthy of an A,” and ranked Bright Start as one of the top five college savings programs in the nation. In April 2009, Money Magazine
Money Magazine
Money Magazine is a business news and financial programme that is broadcast on Sundays at 7:00pm in Hong Kong by television channel TVB Pearl.-Producers and reporters:...
selected Bright Start as one the “best low-risk 529 plans.” In December 2009, Kiplingers selected Bright Start as one of the best state 529 plans in the country, choosing it as the best plan for “low fees.” Morningstar, Inc.
Morningstar, Inc.
Morningstar, Inc. is an independent investment research company based in Chicago, Illinois, USA.-Businesses:Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australia, and Asia. The company offers an extensive line of products and services for...
, which had previously ranked Bright Start in its top 5 in 2008, has acknowledged the issues relating to Core Plus but, citing Illinois’ swift action in dealing with the issue, reported in 2009 that “the plan still holds plenty of appeal.”
In December 2009, the Illinois Attorney General's Office and the Office of the State Treasurer announced that Illinois had reached a settlement with OppenheimerFunds. Eligible accountholders who lost money in Core Plus would receive $77 million from OppenheimerFunds. As the scope of the settlement was expanded during negotiations with OppenheimerFunds to include more accountholders, the total loss addressed by the settlement is $150 million. The payout from this settlement brings the losses for the 2.5% of Bright Start investors who were fully invested in Core Plus down to 17%.
The Treasurer's Office used some of the investment fees from the Bright Start program to purchase a hybrid vehicle to "so Bright Start staff have a way to travel the state and sign families up for the program" and used to promote other Treasurer's Office programs. The vehicle was never used for personal use by Giannoulias.
Other efforts as Treasurer
Giannoulias started a pilot program in 2007 to sell the abandoned contents of safe deposit boxSafe deposit box
A safe deposit box or wrongly referred to as a safety deposit box is an individually-secured container, usually held within a larger safe or bank vault. Safe deposit boxes are generally located in banks, post offices or other institutions...
es on eBay, scrapping the state's annual live auctions.
Broadway Bank
From 2002 to 2006, Giannoulias worked as a senior loan officer and Vice President at Broadway BankBroadway Bank (Illinois)
Broadway Bank was a Chicago bank that existed from 1979 to 2010, and was owned by the Giannoulias family. Its financial situation and history of questionable loans are a factor in the campaign of Alexi Giannoulias in the 2010 U.S. Senate election in Illinois....
, a community bank founded by his father. When he left the bank in 2006, it was one of the most profitable banks in Illinois. Four years later, on January 26, 2010, Broadway Bank entered into a consent decree with the FDIC that ordered Broadway to increase its capital.ur Two dozen small- to medium-sized banks in Illinois and nearly 200 banks nationwide have failed since the October 2008 economic crash.
Broadway Bank’s struggling financial situation is due to delinquent real estate loans and foreclosed properties. From 2002 to 2006, Broadway’s lending in construction and development loans increased sixfold, to $356 million. During Giannoulias’ tenure, Broadway also increased its brokered deposits, which generally command high interest rates. When Giannoulias left the bank in 2006, brokered deposits made up 80% of all deposits at Broadway. When the housing market crashed in late 2008, commercial real estate loan performance deteriorated and Broadway Bank, which had focused its lending in real estate, suffered.
Nine percent of the value of the bad loans originated while Giannoulias was chief loan officer.:1
At the end of business on Friday, , the Illinois Department of Financial and Professional Regulation
Illinois Department of Financial and Professional Regulation
The Illinois Department of Financial and Professional Regulation is an executive agency of the U.S. state of Illinois. It was created in 2004 by an executive order promulgated by Governor Rod Blagojevich....
, Division of Banking, seized Broadway Bank and appointed the Federal Deposit Insurance Corporation
Federal Deposit Insurance Corporation
The Federal Deposit Insurance Corporation is a United States government corporation created by the Glass–Steagall Act of 1933. It provides deposit insurance, which guarantees the safety of deposits in member banks, currently up to $250,000 per depositor per bank. , the FDIC insures deposits at...
(FDIC) as receiver
Receivership
In law, receivership is the situation in which an institution or enterprise is being held by a receiver, a person "placed in the custodial responsibility for the property of others, including tangible and intangible assets and rights." The receivership remedy is an equitable remedy that emerged in...
. The FDIC in turn named MB Financial Bank as the institution receiving Broadway Bank's deposit accounts. The FDIC announced that it and MB Financial Bank would share $878.4 million in losses, for a cost of $394.3 million to the federal Deposit Insurance Fund
Deposit Insurance Fund
The Massachusetts Depositors Insurance Fund was created by the state government of Massachusetts in response to the large number of Massachusetts bank failures during the Great Depression of the 1930s. This fund was the inspiration for the formation of the Federal Deposit Insurance Corporation...
.ur
Loans made by Broadway Bank
Broadway Bank made real estate development loans to Tony RezkoTony Rezko
Antoin "Tony" Rezko is a Assyrian -American businessman, political fundraiser, restaurateur, and real estate developer in Chicago, Illinois, convicted on several counts of fraud and bribery in 2008. Rezko has been involved in fundraising for local Illinois Democratic and Republican politicians...
, a political fundraiser and real estate developer who was later convicted of fraud and money laundering. Broadway Bank made these loans before Rezko was investigated, indicted, or convicted for any crimes. Before his conviction, Rezko also received loans from other Chicago banks, including Bank of Chicago, First Bank and Trust of Illinois, GE Capital, Harris Trust and Savings, LaSalle Bank, and Manufacturers Bank.
Giannoulias himself did not make the Rezko loans.
Rezko defaulted on loans made by Broadway, and, in 2006 Broadway was the first bank to foreclose on one of Rezko’s delinquent loans, forcing him to declare bankruptcy. Broadway Bank also refused to cover nine bad checks written by Rezko for a total of $450,000 in early 2008
Giannoulias never accepted campaign contributions from Rezko.
Broadway Bank also loaned money for real estate developments to Michael Giorango, who has been convicted for prostitution and bookmaking. Giannoulias has stated that he was not part of the loan committee that approved the loans to Giorango.
2010 U.S. Senate campaign
Giannoulias ran against Republican nominee Mark KirkMark Kirk
Mark Steven Kirk is the junior United States Senator from Illinois and a member of the Republican Party. Previously, Kirk was a member of the United States House of Representatives, representing Illinois's 10th congressional district....
, Green Party nominee LeAlan Jones
LeAlan Jones
LeAlan Marvin Jones is an American journalist and the Green Party's 2010 nominee for United States Senate from Illinois. Jones lives in Chicago's Auburn/Gresham Community.Jones' radio documentaries have received critical acclaim and numerous awards...
, and Libertarian nominee Mike Labno.
On March 2, 2009, Giannoulias stated on CNBC that he was forming an exploratory committee
Exploratory Committee
In the election politics of the United States, an exploratory committee is an organization established to help determine whether a potential candidate should run for an elected office. They are most often cited in reference to United States Presidential hopefuls, prior to the primaries.Exploratory...
in order to assess a potential candidacy for the US Senate in 2010. On July 26, 2009, he officially announced his candidacy for the United States Senate at the Hilton Chicago
Hilton Chicago
The Hilton Chicago is a famous luxury hotel in Chicago, United States. The hotel is a Chicago landmark that overlooks Grant Park, Lake Michigan, and the Museum Campus. It is the third-largest hotel in Chicago by number of guest rooms; however, it has the largest total meeting and event space of any...
, the same place then-Senator Barack Obama endorsed Giannoulias for State Treasurer in 2006. He was introduced to the crowd by Congressman Bill Foster
Bill Foster (Illinois politician)
George William "Bill" Foster is a physicist and businessman, and the former U.S. Representative for , serving from 2008 until 2011. He is a member of the Democratic Party.-Early life and education:...
.
Giannoulias was elected the Democratic nominee for US Senate in Illinois in the February 2, 2010 primary, with 39.0% of the vote. David H. Hoffman
David H. Hoffman
David H. Hoffman is a former federal prosecutor and was Chicago's inspector general. On August 26, he declared his candidacy as a Democrat for the Illinois seat of the U.S. Senate...
received 33.8% and Cheryle Jackson received 19.7%.
Endorsements
Giannoulias was endorsed by Planned ParenthoodPlanned Parenthood
Planned Parenthood Federation of America , commonly shortened to Planned Parenthood, is the U.S. affiliate of the International Planned Parenthood Federation and one of its larger members. PPFA is a non-profit organization providing reproductive health and maternal and child health services. The...
, the Service Employees International Union
Service Employees International Union
Service Employees International Union is a labor union representing about 1.8 million workers in over 100 occupations in the United States , and Canada...
(SEIU), AFSCME, the AFL-CIO
AFL-CIO
The American Federation of Labor and Congress of Industrial Organizations, commonly AFL–CIO, is a national trade union center, the largest federation of unions in the United States, made up of 56 national and international unions, together representing more than 11 million workers...
, the League of Conservation Voters
League of Conservation Voters
The League of Conservation Voters is a political advocacy organization founded in 1969 by American environmentalist David Brower in the early years of the environmental movement. LCV's mission is to "advocate for sound environmental policies and to elect pro-environmental candidates who will adopt...
, the Human Rights Campaign
Human Rights Campaign
The Human Rights Campaign is the United States' largest LGBT advocacy group and lobbying organization; according to the HRC, it has more than one million members and supporters...
, the Chicago Sun-Times
Chicago Sun-Times
The Chicago Sun-Times is an American daily newspaper published in Chicago, Illinois. It is the flagship paper of the Sun-Times Media Group.-History:The Chicago Sun-Times is the oldest continuously published daily newspaper in the city...
, and the Sierra Club
Sierra Club
The Sierra Club is the oldest, largest, and most influential grassroots environmental organization in the United States. It was founded on May 28, 1892, in San Francisco, California, by the conservationist and preservationist John Muir, who became its first president...
(Planned Parenthood, the League of Conservation Voters, and the Human Rights Campaign had all supported Congressman Kirk in previous races).
On May 28, 2010, the Human Rights Campaign
Human Rights Campaign
The Human Rights Campaign is the United States' largest LGBT advocacy group and lobbying organization; according to the HRC, it has more than one million members and supporters...
(HRC) endorsed Giannoulias, calling him "a strident supporter of LGBT equality – including supporting marriage equality, repeal of the Defense of Marriage Act, repeal of “Don’t Ask, Don’t Tell” and supporting an inclusive Employment Non-Discrimination Act."
U.S. Senator Dick Durbin, the Assistant Majority Leader and second-highest ranking Democrat in the Senate, endorsed Giannoulias and served as the chairman of the Giannoulias campaign.
President Obama expressed his support of Giannoulias’ Senate bid and joined him on the campaign trail.
External links
- Illinois State Treasurer Alexi Giannoulias official Illinois government site
- Alexi for Senate official campaign site
- Campaign contributions at OpenSecrets.org