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Political fundraiser convicted in corruption trial

CHICAGO — A prominent fundraiser for Sen. Barack Obama and Gov. Rod Blagojevich was convicted of fraud, money laundering and bribery Wednesday after a trial that exposed a corrupt culture of payoffs and campaign finance abuses plaguing Illinois politics.

Antoin “Tony” Rezko, 52, who according to witnesses wielded wide powers within the Blagojevich administration and now faces a stiff prison sentence, was immediately taken into custody after the verdict.

U.S. Attorney Patrick J. Fitzgerald told reporters the verdict represented “an antidote to the poison of corruption” that testimony alleged included the fixing of state boards that controlled a $40 billion pension fund and made major decisions about hospital construction.

One of Rezko’s schemes was a plan to extort a $1.5 million bribe in exchange for Illinois Health Facilities Planning Board approval of a new hospital the Janesville-based Mercy Health System wanted to build in Crystal Lake, Ill. Several of the counts on which Rezko was convicted involved Mercy’s plans.

Mercy, however, was never implicated in the Rezko case.

The nine-week trial included explosive testimony about all-night drug-fueled parties involving the government’s star witness and allegations that Blagojevich personally discussed a state job for a donor.

Political corruption in Illinois has been deemed so extensive that the FBI has sent an extra official corruption squad into the state. Federal officials say the investigation is far from over.

Rezko’s conviction also intensifies the spotlight on his relationship with Obama. Rezko has known Obama since he entered politics, raised money for his Illinois campaigns and was involved in a 2005 real estate deal with him. Obama has donated $150,000 in Rezko-related contributions to charity.

The presumptive Democratic presidential nominee is accused of no wrongdoing and his name was barely mentioned at trial, but Republicans are unlikely to let voters forget about his ties to Rezko as the presidential race heats up.

Obama issued a statement saying he was “saddened,” adding, “This isn’t the Tony Rezko I knew, but now he has been convicted by a jury on multiple charges that once again shine a spotlight on the need for reform.”

Blagojevich also was not accused of wrongdoing, but his reputation received a serious battering by the testimony that emerged. The Legislature has been discussing impeachment, and a wide-open Democratic primary in 2010 is likely.

One witness said the governor discussed a state payroll job for a campaign contributor with a $25,000 donation lying on the table. Another said Blagojevich spoke of big-money state contracts for those who helped him advance his political career—possibly as a presidential candidate.

A money management executive who wanted to invest state pension assets said he was told to sign a contract promising to pay a $800,000 fee to a consultant he had never heard of based in the Turks & Caicos islands.

Blagojevich has repeatedly denied taking part in any of the shadowy political dealings that were described from the witness stand. On Wednesday, he read a prepared statement to reporters in which he called Rezko “a friend” who “was a supporter.”

Rezko, a Chicago real estate developer and fast-food entrepreneur, was convicted of six counts of mail fraud, six counts of wire fraud, two counts of aiding and abetting bribery and two counts of money laundering. The jury acquitted him of three counts of wire fraud, four counts of aiding and abetting bribery, and one count of attempted extortion.

His conviction was a victory for federal prosecutors, who had accused him of plotting with admitted political fixer Stuart Levine to squeeze payoffs out of money management firms that sought to invest the assets of the $40 billion state Teachers Retirement System.

Rezko also was charged in the 24-count indictment with plotting with Levine to get a $1.5 million bribe from a contractor who sought state approval to build a hospital in the McHenry County suburb of Crystal Lake.