Tony Rezko
Encyclopedia
Antoin "Tony" Rezko is a Assyrian (Syriac)-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 since the 1980s. After becoming a major contributor to Rod Blagojevich
's successful gubernatorial election, Rezko assisted Blagojevich in setting up the state's first Democratic administration in twenty years. Rezko was able to have business associates appointed onto several state boards. Rezko and several others were indicted on federal charges in October 2006, for using their connections to the state boards to demand kickbacks from businesses that wanted to do business with the state. While the others pleaded guilty to the charges, Rezko pleaded not guilty and was found guilty of 16 of the 24 charges filed against him. On November 23, 2011, Rezko was sentenced to 10 1/2 years in prison.
family. After graduating from college there, Rezko moved to Chicago
and earned an undergraduate and a master's degree in civil engineering from the Illinois Institute of Technology
in the late 1970s. He joined an engineering company, designing nuclear power
plants, then left to design roads for the state Transportation Department, making $21,590 in his first year there.
in Chicago. Many of these properties were in lower-income African American
neighborhoods. Then, meeting Jabir Herbert Muhammad, former manager of heavyweight champion Muhammad Ali
and son of the late Nation of Islam
leader, Elijah Muhammad
, he was asked in 1983 to support the successful mayoral candidacy of Harold Washington
. J. H. Muhammad's company, Crucial Concessions, which Rezko went to work for in 1984, won a food contract at the Lake Michigan beaches and in many South Side parks after Washington became the first black mayor of Chicago. Rezko put together endorsement deals for Ali, became the executive director of the Muhammad Ali Foundation, and traveled the world with Ali for five years. In 1997, Crucial opened two Panda Express Restaurants at O'Hare, under the city's minority set-aside program. It lost those franchises in 2005, on the grounds that J. H. Muhammad was merely a front for Rezko, who had been appointed trustee of J.H. Muhammad's affairs in the early 1990s because of the latter's failing health. In March 2008 Muhammad sued Rezko, alleging that he had been swindled out of his home and business interests.
In January 1989, Rezko and Daniel Mahru, CEO of a firm which leased ice makers to bars, hotels and restaurants and a former attorney, founded a real-estate development and restaurant holding corporation called Rezmar Corporation. Between 1989 and 1998, Rezmar made deals to rehab 30 buildings, a total of 1,025 apartments, expending more than $100 million from the city, state and federal governments and in bank loans. Rezko and Mahru weren't responsible for any government or bank loans or the $50 million in federal tax credits they got to rehab the buildings. Rezmar put just $100 into each project and got a 1% stake as the general partner in charge of hiring the architect, contractor, and the company that would manage the buildings. They selected Chicago Property Management, also owned by Rezko and Mahru, to manage the buildings including selecting the tenants and making repairs. Rezmar also got upfront development fees of at least $6.9 million in all. Under its deals with the Chicago Equity Fund, Rezmar promised to cover all operating losses in any building for seven years, but had no obligation after that, although the Federal Government could recover the tax credits that Rezmar sold from the holders if the projects did not survive for fifteen years or more. By 1998 the company had a net worth of US$
34 million, and it then turned to purchasing old factories and parcels of land in gentrifying
areas of Chicago and turning them into upscale condominium complexes.
Rezko was named "Entrepreneur of the Decade" by the Arab-American Business and Professional Association.
Rezko's investment in restaurant food chains had started with a chain of Panda Express
Chinese restaurants. In 1998, Rezko opened his first chain of Papa John's Pizza
restaurants in Chicago and by 2002, he had twenty-six stores in Chicago, at least fifteen in Wisconsin
, and seven in Detroit, part of the financing for these stores was through GE Capital
. By 2001, Rezko began to fall behind on his franchise payments and loans and he transferred the franchises to several business associates. In 2006, during a lawsuit with Papa John's over his franchise fees, Rezko renamed his Papa John's restaurants to Papa Tony's. Rezko also had a lien filed against his home after losing a civil lawsuit to GE Capital.
As his business ventures began failing, Rezko entered into several partnership with Iraqi-born business executive Nadhmi Auchi
, including a massive 2005 real estate development project on Chicago's South Loop
whose value was pegged by an observer familiar with the deal at $130.5 million. In 2008. Rezko was imprisoned for his failure to disclose a $3.5m loan from Auchi.
.
Rezko pleaded not guilty, and the trial related to his charges from Operation Board Games began on March 6, 2008. He was jailed shortly before the trial began when he received a $3.5 million wire transfer from Lebanon. Rezko had told the court that he had no access to money from overseas. Ten weeks into the trial, on April 18, Judge Amy St. Eve released Rezko, after friends and relatives put up 30 properties valued at about $8.5 million to secure his bond. Prosecutors opposed the motion for release, saying that Rezko was a flight risk. On May 6, both the prosecution and the defense rested their cases. Government prosecutors spent 8 weeks presenting their case. Rezko’s lawyer, Joseph J. Duffy, chose not to present any witnesses, saying that he did not believe that the prosecution had proven the charges. Prosecutors contended that they had shown Rezko's "corrupt use of his power and influence" to gain benefits for himself and his friends. Duffy argued that the prosecution had exaggerated Rezko's influence in state government, and attacked Levine's credibility as a witness.
The case went to the jury on May 13 and after three weeks of deliberation, the jury found Rezko guilty of six counts of wire fraud, six counts of mail fraud, two counts of corrupt solicitation, and two counts of money laundering, but found him not guilty on three counts of wire and mail fraud, one count of attempted extortion, and four counts of corrupt solicitation. According to CBS News the "high-profile federal trial provided an unusually detailed glimpse of the pay-to-play politics that has made Illinois infamous."
While the jury was deliberating on the Board Games trial, an arrest warrant was issued in Las Vegas
for passing bad checks in two casinos and failing to pay $450,000 in gambling debts that were accrued between March and July 2006. Another casino had also filed a civil complaint for a total of $331,000 in 2006 and was given a judgment of default in 2007.
. Rezko has pled not guilty to these charges and the trial is scheduled to begin in 2009.
and his family were at the root of the federal corruption case which led to Rezko's conviction. Rezko donated $117,652 to Blagojevich's campaigns, and is credited by the prosecutor in his trial with having delivered bundled contributions totalling almost $1.44 million. Since 1997, Blagojevich's wife, Patricia, has made at least $38,000 acting as Rezko's real-estate agent on several of his company's property acquisitions. When Blagojevich won the Illinois gubernatorial election in 2002, Rezko assisted Blagojevich in setting up the state's first Democratic administration in twenty years. Rezko recommended many of his business associates and their relatives for positions within state government, three of whom were appointed to the state board that oversees hospital projects. the state's development board was run by another former Rezko business associate. Rezko and Republican fundraiser Stuart Levine were charged in a 24-count federal indictment for allegedly using Rezko's influence with public officials to demand millions of dollars in kickbacks from companies that wanted to do business with the state. Levine pled guilty and served as the chief witness against Rezko at trial. Levine and several other witnesses implicated Blagojevich in the schemes.
The last indictment in Operation Board Games
before Blagojevich himself was indicted was that of William F. Cellini
who was indicted for conspiring with Rezko to shake down
Chicago-based Capri Capital to get a substantial contribution to Blagojevich in exchange for allowing Capri to manage $220 million in the Teachers Retirement System. After Thomas Rosenberg of Capri threatened to tell authorities, the plan was abandoned. Capri has substantial investments in the Watergate complex
and King Abdullah Economic City
.
was elected president of the Harvard Law Review
, Rezmar Corp. offered him a job, which Obama turned down. Obama instead took a job with the firm of Davis, Miner, Barnhill & Galland, which primarily worked on civil rights cases. The firm also represented Rezmar and helped the company get more than $43 million in government funding. The firm's former senior partner, Allison S. Davis, later went into business with Rezko and, in 2003, was appointed to the Illinois State Board of Investment by Governor Blagojevich at Rezko's request. On July 31, 1995, the first ever political contributions to Obama were $300 from a lawyer, a $5,000 loan from a car dealer, and $2,000 from two food companies owned by Rezko. Starting in 2003, Rezko was one of the people on Obama's U.S. Senate campaign finance committee, which raised more than $14 million. Rezko threw an early fundraiser for Obama that Chicago Tribune
reporter David Mendelland claims was instrumental in providing Obama with seed money for his U.S. Senate race. Obama in 2007-08 identified over $250,000 in campaign contributions to various Obama campaigns as coming from Rezko or close associates, and said that he donated almost two-thirds of that amount to nonprofit groups.
After it had been reported in 2006 that Rezko was under federal investigation for influence-peddling, Obama purchased a 10 feet (3 m) wide strip of Ms. Rezko's property for $104,500, $60,000 above the assessed value. According to Chicago Sun-Times
columnist, Mark Brown, "Rezko definitely did Obama a favor by selling him the 10-foot strip of land, making his own parcel less attractive for development." Obama acknowledges that the exchange may have created the appearance of impropriety, and stated "I consider this a mistake on my part and I regret it."
On December 28, 2006, Ms. Rezko sold the property to a company owned by her husband's former business attorney. That sale of $575,000, combined with the earlier $104,500 sale to the Obamas, amounted to a net profit
of $54,500 over her original purchase, less $14,000 for a fence along the property line and other expenses. In October 2007, the new owners put the still vacant land up for sale again, this time for $1.5 million.
In the South Carolina Democratic Party
presidential debate on January 21, 2008, Senator Hillary Clinton said that Obama had been associated with Rezko, whom she referred to as a slum landlord
. The LA Times said that a review they did showed that Rezko played a deeper role in Obama's political and financial biography than Obama had acknowledged. Within days of the debate, a photo of Rezko posing with Bill
and Hillary Clinton surfaced. When asked about the photo, Hillary Clinton commented "I probably have taken hundreds of thousands of pictures. I wouldn’t know him if he walked in the door."
during Washington's successful campaign to become Chicago's mayor. He has since raised funds for many other politicians. In addition to Blagojevich and Obama, prominent Democrats that Rezko or his company, Rezmar, have contributed money to, or fund-raised for, are Congressman Luis Gutierrez
, a friend for over two decades, Comptroller Dan Hynes
, Attorney General Lisa Madigan
, Lieutenant Governor Pat Quinn
, former Chicago Mayors Daley and Washington, and former Cook County Board President John Stroger
. Rezko has also raised money for Republicans, including former Illinois Governors Jim Edgar
and George Ryan
. The late Rosemont, Illinois
, Mayor Donald Stephens
and Rezko co-chaired a multimillion-dollar fund-raiser for President George W. Bush
in 2003.
Rezko headed the 2002 campaign finance committee for Stroger. Stroger appointed Rezko's wife, Rita, to the Cook County Employee Appeals Board, which hears cases brought by fired or disciplined workers. The part-time post pays $37,000 a year. A Rezko company had a contract to maintain pay telephones at the Cook County Jail
under Stroger. The Chicago Sun-Times puts Rezko's contributions to Stroger at $148,300.
Restaurant
A restaurant is an establishment which prepares and serves food and drink to customers in return for money. Meals are generally served and eaten on premises, but many restaurants also offer take-out and food delivery services...
, and real estate developer
Real estate development
Real estate development, or Property Development, is a multifaceted business, encompassing activities that range from the renovation and re-lease of existing buildings to the purchase of raw land and the sale of improved land or parcels to others...
in Chicago
Chicago
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...
, Illinois
Illinois
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,...
, convicted on several counts of fraud
Fraud
In criminal law, a fraud is an intentional deception made for personal gain or to damage another individual; the related adjective is fraudulent. The specific legal definition varies by legal jurisdiction. Fraud is a crime, and also a civil law violation...
and bribery
Bribery
Bribery, a form of corruption, is an act implying money or gift giving that alters the behavior of the recipient. Bribery constitutes a crime and is defined by Black's Law Dictionary as the offering, giving, receiving, or soliciting of any item of value to influence the actions of an official or...
in 2008. Rezko has been involved in fundraising for local Illinois Democratic
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...
and 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...
politicians since the 1980s. After becoming a major contributor to 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...
's successful gubernatorial election, Rezko assisted Blagojevich in setting up the state's first Democratic administration in twenty years. Rezko was able to have business associates appointed onto several state boards. Rezko and several others were indicted on federal charges in October 2006, for using their connections to the state boards to demand kickbacks from businesses that wanted to do business with the state. While the others pleaded guilty to the charges, Rezko pleaded not guilty and was found guilty of 16 of the 24 charges filed against him. On November 23, 2011, Rezko was sentenced to 10 1/2 years in prison.
Early life and education
Rezko was born in 1955 in Aleppo, Syria, to a prominent Syriac CatholicSyriac Catholic Church
The Syriac Catholic Church is a Christian church in the Levant having practices and rites in common with the Syriac Orthodox Church. They are one of the Eastern Catholic Churches following the Antiochene rite, the Syriac tradition of Antioch, along with the Maronites and Syro-Malankara Christians...
family. After graduating from college there, Rezko moved to Chicago
Chicago
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...
and earned an undergraduate and a master's degree in civil engineering from the Illinois Institute of Technology
Illinois Institute of Technology
Illinois Institute of Technology, commonly called Illinois Tech or IIT, is a private Ph.D.-granting university located in Chicago, Illinois, with programs in engineering, science, psychology, architecture, business, communications, industrial technology, information technology, design, and law...
in the late 1970s. He joined an engineering company, designing nuclear power
Nuclear power
Nuclear power is the use of sustained nuclear fission to generate heat and electricity. Nuclear power plants provide about 6% of the world's energy and 13–14% of the world's electricity, with the U.S., France, and Japan together accounting for about 50% of nuclear generated electricity...
plants, then left to design roads for the state Transportation Department, making $21,590 in his first year there.
Business Career
Soon after beginning his career as a civil engineer, Rezko started in real estate buying vacant lots and developing single family residences and investing in fast-food restaurants—including the first SubwaySubway (restaurant)
Subway is an American restaurant franchise that primarily sells submarine sandwiches and salads. It is owned and operated by Doctor's Associates, Inc. . Subway is one of the fastest growing franchises in the world with 35,519 restaurants in 98 countries and territories as of October 25th, 2011...
in Chicago. Many of these properties were in lower-income African American
African American
African Americans are citizens or residents of the United States who have at least partial ancestry from any of the native populations of Sub-Saharan Africa and are the direct descendants of enslaved Africans within the boundaries of the present United States...
neighborhoods. Then, meeting Jabir Herbert Muhammad, former manager of heavyweight champion Muhammad Ali
Muhammad Ali
Muhammad Ali is an American former professional boxer, philanthropist and social activist...
and son of the late Nation of Islam
Nation of Islam
The Nation of Islam is a mainly African-American new religious movement founded in Detroit, Michigan by Wallace D. Fard Muhammad in July 1930 to improve the spiritual, mental, social, and economic condition of African-Americans in the United States of America. The movement teaches black pride and...
leader, Elijah Muhammad
Elijah Muhammad
Elijah Muhammad was an African American religious leader, and led the Nation of Islam from 1934 until his death in 1975...
, he was asked in 1983 to support the successful mayoral candidacy of Harold Washington
Harold Washington
Harold Lee Washington was an American lawyer and politician who became the first African-American Mayor of Chicago, serving from 1983 until his death in 1987.- Early years and military service :...
. J. H. Muhammad's company, Crucial Concessions, which Rezko went to work for in 1984, won a food contract at the Lake Michigan beaches and in many South Side parks after Washington became the first black mayor of Chicago. Rezko put together endorsement deals for Ali, became the executive director of the Muhammad Ali Foundation, and traveled the world with Ali for five years. In 1997, Crucial opened two Panda Express Restaurants at O'Hare, under the city's minority set-aside program. It lost those franchises in 2005, on the grounds that J. H. Muhammad was merely a front for Rezko, who had been appointed trustee of J.H. Muhammad's affairs in the early 1990s because of the latter's failing health. In March 2008 Muhammad sued Rezko, alleging that he had been swindled out of his home and business interests.
In January 1989, Rezko and Daniel Mahru, CEO of a firm which leased ice makers to bars, hotels and restaurants and a former attorney, founded a real-estate development and restaurant holding corporation called Rezmar Corporation. Between 1989 and 1998, Rezmar made deals to rehab 30 buildings, a total of 1,025 apartments, expending more than $100 million from the city, state and federal governments and in bank loans. Rezko and Mahru weren't responsible for any government or bank loans or the $50 million in federal tax credits they got to rehab the buildings. Rezmar put just $100 into each project and got a 1% stake as the general partner in charge of hiring the architect, contractor, and the company that would manage the buildings. They selected Chicago Property Management, also owned by Rezko and Mahru, to manage the buildings including selecting the tenants and making repairs. Rezmar also got upfront development fees of at least $6.9 million in all. Under its deals with the Chicago Equity Fund, Rezmar promised to cover all operating losses in any building for seven years, but had no obligation after that, although the Federal Government could recover the tax credits that Rezmar sold from the holders if the projects did not survive for fifteen years or more. By 1998 the company had a net worth of US$
United States dollar
The United States dollar , also referred to as the American dollar, is the official currency of the United States of America. It is divided into 100 smaller units called cents or pennies....
34 million, and it then turned to purchasing old factories and parcels of land in gentrifying
Gentrification
Gentrification and urban gentrification refer to the changes that result when wealthier people acquire or rent property in low income and working class communities. Urban gentrification is associated with movement. Consequent to gentrification, the average income increases and average family size...
areas of Chicago and turning them into upscale condominium complexes.
Rezko was named "Entrepreneur of the Decade" by the Arab-American Business and Professional Association.
Rezko's investment in restaurant food chains had started with a chain of Panda Express
Panda Express
Panda Express is a fast casual restaurant chain serving American Chinese cuisine. It operates mainly inside the United States, in casinos, shopping malls, supermarkets, airports, train stations, strip plazas, theme parks, stadiums, college campuses and The Pentagon...
Chinese restaurants. In 1998, Rezko opened his first chain of Papa John's Pizza
Papa John's Pizza
Papa John's Pizza is the third largest take-out and delivery pizza restaurant chain in the United States, behind Pizza Hut and Domino's Pizza. It is based in Louisville, Kentucky. Papa John's slogan is "Better Ingredients. Better pizza. Papa John's"...
restaurants in Chicago and by 2002, he had twenty-six stores in Chicago, at least fifteen in Wisconsin
Wisconsin
Wisconsin is a U.S. state located in the north-central United States and is part of the Midwest. It is bordered by Minnesota to the west, Iowa to the southwest, Illinois to the south, Lake Michigan to the east, Michigan to the northeast, and Lake Superior to the north. Wisconsin's capital is...
, and seven in Detroit, part of the financing for these stores was through GE Capital
GE Capital
GE Capital is the financial services unit of General Electric, one of five major units. Its various divisions include GE Capital Aviation Services, GE Capital Real Estate, GE Energy Financial Services and GE Money....
. By 2001, Rezko began to fall behind on his franchise payments and loans and he transferred the franchises to several business associates. In 2006, during a lawsuit with Papa John's over his franchise fees, Rezko renamed his Papa John's restaurants to Papa Tony's. Rezko also had a lien filed against his home after losing a civil lawsuit to GE Capital.
As his business ventures began failing, Rezko entered into several partnership with Iraqi-born business executive Nadhmi Auchi
Nadhmi Auchi
Nadhmi Shakir Auchi, , is a British Iraqi businessman and billionaire, founding president of the Anglo Arab Organisation, and the founder and chairman of General Mediterranean Holding , a conglomerate of 120 companies worldwide...
, including a massive 2005 real estate development project on Chicago's South Loop
Chicago Loop
The Loop or Chicago Loop is one of 77 officially designated Chicago community areas located in the City of Chicago, Illinois. It is the historic commercial center of downtown Chicago...
whose value was pegged by an observer familiar with the deal at $130.5 million. In 2008. Rezko was imprisoned for his failure to disclose a $3.5m loan from Auchi.
Legal troubles
Rezko was later convicted on 16 charges of corruption and fraud and was sentenced to serve 10 1/2 years in prison.Public corruption charges
In October 2006, Rezko was indicted along with businessman Stuart Levine on charges of wire fraud, bribery, money laundering, and attempted extortion as a result of a federal investigation known as "Operation Board Games." Levine was once a top Republican fund-raiser who had switched loyalty in recent years. Rezko and Levine were charged with attempting to extort millions of dollars from businesses seeking to do business with the Illinois Teachers System Board and the Illinois Health Facilities Planning Board from 2002 to 2004. Levine pleaded guilty and agreed to testify against Rezko and others. While the charges carry a maximum sentence of life in prison, Levine expects to receive about a 5-1/2 year sentence in return for his testimony. The case was prosecuted by Patrick FitzgeraldPatrick Fitzgerald
Patrick J. Fitzgerald is the current United States Attorney for the Northern District of Illinois and a member of the U.S. Department of Justice Office of Special Counsel...
.
Rezko pleaded not guilty, and the trial related to his charges from Operation Board Games began on March 6, 2008. He was jailed shortly before the trial began when he received a $3.5 million wire transfer from Lebanon. Rezko had told the court that he had no access to money from overseas. Ten weeks into the trial, on April 18, Judge Amy St. Eve released Rezko, after friends and relatives put up 30 properties valued at about $8.5 million to secure his bond. Prosecutors opposed the motion for release, saying that Rezko was a flight risk. On May 6, both the prosecution and the defense rested their cases. Government prosecutors spent 8 weeks presenting their case. Rezko’s lawyer, Joseph J. Duffy, chose not to present any witnesses, saying that he did not believe that the prosecution had proven the charges. Prosecutors contended that they had shown Rezko's "corrupt use of his power and influence" to gain benefits for himself and his friends. Duffy argued that the prosecution had exaggerated Rezko's influence in state government, and attacked Levine's credibility as a witness.
The case went to the jury on May 13 and after three weeks of deliberation, the jury found Rezko guilty of six counts of wire fraud, six counts of mail fraud, two counts of corrupt solicitation, and two counts of money laundering, but found him not guilty on three counts of wire and mail fraud, one count of attempted extortion, and four counts of corrupt solicitation. According to CBS News the "high-profile federal trial provided an unusually detailed glimpse of the pay-to-play politics that has made Illinois infamous."
While the jury was deliberating on the Board Games trial, an arrest warrant was issued in Las Vegas
Las Vegas, Nevada
Las Vegas is the most populous city in the U.S. state of Nevada and is also the county seat of Clark County, Nevada. Las Vegas is an internationally renowned major resort city for gambling, shopping, and fine dining. The city bills itself as The Entertainment Capital of the World, and is famous...
for passing bad checks in two casinos and failing to pay $450,000 in gambling debts that were accrued between March and July 2006. Another casino had also filed a civil complaint for a total of $331,000 in 2006 and was given a judgment of default in 2007.
Charges related to private business dealings
Rezko is also under indictment, along with a business associate, for wire fraud related to the alleged sale of his pizza business to a straw buyer at an inflated price in order to obtain millions of dollars in loans from GE CapitalGE Capital
GE Capital is the financial services unit of General Electric, one of five major units. Its various divisions include GE Capital Aviation Services, GE Capital Real Estate, GE Energy Financial Services and GE Money....
. Rezko has pled not guilty to these charges and the trial is scheduled to begin in 2009.
Ties to Rod Blagojevich
Rezko's relationship with Illinois Governor Rod BlagojevichRod 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...
and his family were at the root of the federal corruption case which led to Rezko's conviction. Rezko donated $117,652 to Blagojevich's campaigns, and is credited by the prosecutor in his trial with having delivered bundled contributions totalling almost $1.44 million. Since 1997, Blagojevich's wife, Patricia, has made at least $38,000 acting as Rezko's real-estate agent on several of his company's property acquisitions. When Blagojevich won the Illinois gubernatorial election in 2002, Rezko assisted Blagojevich in setting up the state's first Democratic administration in twenty years. Rezko recommended many of his business associates and their relatives for positions within state government, three of whom were appointed to the state board that oversees hospital projects. the state's development board was run by another former Rezko business associate. Rezko and Republican fundraiser Stuart Levine were charged in a 24-count federal indictment for allegedly using Rezko's influence with public officials to demand millions of dollars in kickbacks from companies that wanted to do business with the state. Levine pled guilty and served as the chief witness against Rezko at trial. Levine and several other witnesses implicated Blagojevich in the schemes.
The last indictment in Operation Board Games
Operation Board Games
Operation Board Games is a federal fraud investigation initiated by United States Attorney Patrick Fitzgerald in December 2003, in order to investigate suspected fraud and extortion activity by Illinois Governor Rod Blagojevich...
before Blagojevich himself was indicted was that of William F. Cellini
William F. Cellini
William F. Cellini is co-founder of the New Frontier Companies, a group of Illinois-based real estate companies with headquarters in Chicago that employ more than 250 people statewide...
who was indicted for conspiring with Rezko to shake down
Extortion
Extortion is a criminal offence which occurs when a person unlawfully obtains either money, property or services from a person, entity, or institution, through coercion. Refraining from doing harm is sometimes euphemistically called protection. Extortion is commonly practiced by organized crime...
Chicago-based Capri Capital to get a substantial contribution to Blagojevich in exchange for allowing Capri to manage $220 million in the Teachers Retirement System. After Thomas Rosenberg of Capri threatened to tell authorities, the plan was abandoned. Capri has substantial investments in the Watergate complex
Watergate complex
The Watergate complex is a group of five buildings next to the John F. Kennedy Center for the Performing Arts in the Foggy Bottom neighborhood of Washington, D.C. in the United States. The site contains an office building, three apartment buildings, and a hotel-office building...
and King Abdullah Economic City
King Abdullah Economic City
King Abdullah Economic City is a megaproject announced in 2005 by Abdullah bin Abdulaziz Al Saud, the king of Saudi Arabia.-Overview:...
.
History
In 1990, after 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...
was elected president of the Harvard Law Review
Harvard Law Review
The Harvard Law Review is a journal of legal scholarship published by an independent student group at Harvard Law School.-Overview:According to the 2008 Journal Citation Reports, the Review is the most cited law review and has the second-highest impact factor in the category "law" after the...
, Rezmar Corp. offered him a job, which Obama turned down. Obama instead took a job with the firm of Davis, Miner, Barnhill & Galland, which primarily worked on civil rights cases. The firm also represented Rezmar and helped the company get more than $43 million in government funding. The firm's former senior partner, Allison S. Davis, later went into business with Rezko and, in 2003, was appointed to the Illinois State Board of Investment by Governor Blagojevich at Rezko's request. On July 31, 1995, the first ever political contributions to Obama were $300 from a lawyer, a $5,000 loan from a car dealer, and $2,000 from two food companies owned by Rezko. Starting in 2003, Rezko was one of the people on Obama's U.S. Senate campaign finance committee, which raised more than $14 million. Rezko threw an early fundraiser for Obama that Chicago Tribune
Chicago Tribune
The Chicago Tribune is a major daily newspaper based in Chicago, Illinois, and the flagship publication of the Tribune Company. Formerly self-styled as the "World's Greatest Newspaper" , it remains the most read daily newspaper of the Chicago metropolitan area and the Great Lakes region and is...
reporter David Mendelland claims was instrumental in providing Obama with seed money for his U.S. Senate race. Obama in 2007-08 identified over $250,000 in campaign contributions to various Obama campaigns as coming from Rezko or close associates, and said that he donated almost two-thirds of that amount to nonprofit groups.
Real estate dealings
In 2005 Obama purchased a new home in the Kenwood District of Chicago for $1.65 million (which was $300,000 below the asking price but represented the highest offer on the property) on the same day that Rezko's wife, Rita Rezko, purchased the adjoining empty lot from the same sellers for the full asking price. Obama acknowledged bringing his interest in the property to Rezko's attention, but denied any coordination of offers. According to Obama, while the properties had originally been a single property, the previous owners decided to sell the land as two separate lots, but made it a condition of the sales that they be closed on the same date. Obama also stated that the properties had been on the market for months, that his offer was the best of two bids, and that Ms. Rezko's bid was matched by another offer, also of $625,000, so that she could not have purchased the property for less.After it had been reported in 2006 that Rezko was under federal investigation for influence-peddling, Obama purchased a 10 feet (3 m) wide strip of Ms. Rezko's property for $104,500, $60,000 above the assessed value. According to 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...
columnist, Mark Brown, "Rezko definitely did Obama a favor by selling him the 10-foot strip of land, making his own parcel less attractive for development." Obama acknowledges that the exchange may have created the appearance of impropriety, and stated "I consider this a mistake on my part and I regret it."
On December 28, 2006, Ms. Rezko sold the property to a company owned by her husband's former business attorney. That sale of $575,000, combined with the earlier $104,500 sale to the Obamas, amounted to a net profit
Net profit
Net profit or net revenue is a measure of the profitability of a venture after accounting for all costs. In a survey of nearly 200 senior marketing managers, 91 percent responded that they found the "net profit" metric very useful...
of $54,500 over her original purchase, less $14,000 for a fence along the property line and other expenses. In October 2007, the new owners put the still vacant land up for sale again, this time for $1.5 million.
Obama's letters
In June 2007, the Sun-Times published a story about letters Obama had written in 1997 to city and state officials in support of a low-income senior citizen development project headed by Rezko and Davis. The project received more than $14 million in taxpayer funds, including $885,000 in development fees for Rezko and Davis. Of Obama's letters in support of the Cottage View Terrace apartments development, Obama spokesman Bill Burton said, "This wasn't done as a favor for anyone, it was done in the interests of the people in the community who have benefited from the project. I don't know that anyone specifically asked him to write this letter nine years ago. There was a consensus in the community about the positive impact the project would make and Obama supported it because it was going to help people in his district." Rezko's attorney responded that "Mr. Rezko never spoke with, nor sought a letter from, Senator Obama in connection with that project.In the South Carolina Democratic Party
South Carolina Democratic Party
The South Carolina Democratic Party is the South Carolina affiliate of the United States Democratic Party. The Democratic party thrived during the Second Party System between 1832 and the mid-1850s and was one of the causes of the collapse of the Whig Party....
presidential debate on January 21, 2008, Senator Hillary Clinton said that Obama had been associated with Rezko, whom she referred to as a slum landlord
Slumlord
A slumlord is a derogatory term for landlords, generally absentee landlords, who attempt to maximize profit by minimizing spending on property maintenance, often in deteriorating neighborhoods. They may need to charge lower than market rent to tenants...
. The LA Times said that a review they did showed that Rezko played a deeper role in Obama's political and financial biography than Obama had acknowledged. Within days of the debate, a photo of Rezko posing with Bill
Bill Clinton
William Jefferson "Bill" Clinton is an American politician who served as the 42nd President of the United States from 1993 to 2001. Inaugurated at age 46, he was the third-youngest president. He took office at the end of the Cold War, and was the first president of the baby boomer generation...
and Hillary Clinton surfaced. When asked about the photo, Hillary Clinton commented "I probably have taken hundreds of thousands of pictures. I wouldn’t know him if he walked in the door."
Ties to other politicians
Tony Rezko's first significant political act was hosting a fundraiser for Harold WashingtonHarold Washington
Harold Lee Washington was an American lawyer and politician who became the first African-American Mayor of Chicago, serving from 1983 until his death in 1987.- Early years and military service :...
during Washington's successful campaign to become Chicago's mayor. He has since raised funds for many other politicians. In addition to Blagojevich and Obama, prominent Democrats that Rezko or his company, Rezmar, have contributed money to, or fund-raised for, are Congressman Luis Gutierrez
Luis Gutiérrez
Luis Vicente Gutiérrez is an American politician and the U.S. Representative for , serving since 1993. Gutiérrez was the first Latino to be elected to Congress from the Midwest. From 1986 until his election to Congress he served as a member of the Chicago City Council representing the 26th ward...
, a friend for over two decades, Comptroller Dan Hynes
Daniel Hynes
Daniel W. Hynes is an American politician, formerly the Illinois Comptroller.-Background:Hynes was born in Chicago. He attended St. Ignatius College Prep in Chicago, where he graduated in 1986. Hynes later attended the University of Notre Dame, where he graduated magna cum laude in 1990 with a...
, Attorney General Lisa Madigan
Lisa Madigan
Lisa Madigan has been the 41st Attorney General of the US state of Illinois since 2003, when she became the first female attorney general for Illinois...
, Lieutenant Governor Pat Quinn
Pat Quinn (politician)
Patrick Joseph "Pat" Quinn III is the 41st and current Governor of Illinois. He is a member of the Democratic Party. Previously elected three times to statewide office, Quinn was the sitting lieutenant governor and became governor on January 29, 2009, when the previous governor, Rod Blagojevich,...
, former Chicago Mayors Daley and Washington, and former Cook County Board President John Stroger
John Stroger
John H. Stroger, Jr. was an American politician who served from 1994 until 2006 as the first African-American president of the Cook County, Illinois Board of Commissioners. Stroger was a member of the Democratic Party. He was also a member of Alpha Phi Alpha fraternity...
. Rezko has also raised money for Republicans, including former Illinois Governors Jim Edgar
Jim Edgar
James Edgar is an American politician who was the 38th Governor of Illinois from 1991 to 1999 and Illinois Secretary of State from 1981 to 1991. As a moderate Republican in a largely blue-leaning state, Edgar was a popular and successful governor, leaving office with high approval ratings...
and George Ryan
George Ryan
George Homer Ryan, Sr. was the 39th Governor of the U.S. state of Illinois from 1999 until 2003. He is a member of the Republican Party. Ryan became nationally known when in 2000 he imposed a moratorium on executions and "raised the national debate on capital punishment"...
. The late Rosemont, Illinois
Rosemont, Illinois
Rosemont is a village in Cook County, Illinois, United States located immediately northwest of Chicago. The village was incorporated in 1956, though it had been settled long before that...
, Mayor Donald Stephens
Donald Stephens
Donald E. Stephens was the first mayor of Rosemont, Illinois, USA, and a leading Illinois Republican politician....
and Rezko co-chaired a multimillion-dollar fund-raiser for President George W. Bush
George W. Bush
George Walker Bush is an American politician who served as the 43rd President of the United States, from 2001 to 2009. Before that, he was the 46th Governor of Texas, having served from 1995 to 2000....
in 2003.
Rezko headed the 2002 campaign finance committee for Stroger. Stroger appointed Rezko's wife, Rita, to the Cook County Employee Appeals Board, which hears cases brought by fired or disciplined workers. The part-time post pays $37,000 a year. A Rezko company had a contract to maintain pay telephones at the Cook County Jail
Cook County Jail
The Cook County Jail, located on in Cook County, Illinois, is the largest jail in the United States of America housing approximately 9,800 men and women. The facility is located at 3015 S California Ave in the city of Chicago...
under Stroger. The Chicago Sun-Times puts Rezko's contributions to Stroger at $148,300.
External links
- The Tony Rezko Case complete coverage from the Chicago TribuneChicago TribuneThe Chicago Tribune is a major daily newspaper based in Chicago, Illinois, and the flagship publication of the Tribune Company. Formerly self-styled as the "World's Greatest Newspaper" , it remains the most read daily newspaper of the Chicago metropolitan area and the Great Lakes region and is...
- Tony Rezko complete coverage from the Chicago Sun-TimesChicago Sun-TimesThe 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...
- Eric Zorn, RezkoWebliography The Chicago Tribune, February 7, 2008
- Antoin Rezko Indictment, United States Department of JusticeUnited States Department of JusticeThe United States Department of Justice , is the United States federal executive department responsible for the enforcement of the law and administration of justice, equivalent to the justice or interior ministries of other countries.The Department is led by the Attorney General, who is nominated...
, Oct 11 2006