Fundraiser's fraud trial full of surprises as star witness talks

CHICAGO -- Political fundraiser Antoin "Tony" Rezko's fraud trial has only been going three weeks but already has produced more than its share of embarrassing bombshells.

Names are being named and nerves are being hit.

From Gov. Rod Blagojevich to anonymous bureaucrats toiling away in the back offices of Springfield, there's plenty of embarrassment to go around. And there's no mystery about why.

Stuart Levine, a political fixer who by his own admission was awash in corruption for decades, has been sitting in the witness chair, calmly telling tales of alleged wrongdoing by the high and mighty.

Levine has nothing to lose. He is headed for a 5 1/2-year prison term and owes the government $5 million, though he is broke and figures he always will be.

The biggest name Levine has named: Blagojevich.

In October 2003, Levine was grateful to the governor, who had just reappointed him to the Illinois Health Facilities Planning Board.

There was money to be made on the board -- bribe money, of course, but Levine says he didn't care about that. He just wanted the money.

To show his gratitude, Levine says, he picked up the tab for a chartered plane to New York for Blagojevich to put the arm on potential campaign donors. After a hard day of shaking the money tree, Levine said he flew back to Chicago with Blagojevich and political fundraiser Chris Kelly.

It was then that he says he thanked Blagojevich for the board seat.

"Never discuss any state board with me," Levine quoted Blagojevich as telling him that day. "You discuss those with either Tony Rezko or Chris Kelly. But you stick with us and you will do very well for yourself."

At that point, Kelly changed the subject, Levine says.

"What did you take (the governor) to mean by that?" Assistant federal prosecutor Christopher S. Niewoehner asked Levine.

"I took it to mean that I would have an opportunity to make a lot of money," Levine said.

Blagojevich has not been charged with wrongdoing, and his spokeswoman Abby Ottenhoff was quick to respond.

"Stuart Levine's assertions about the governor are wrong," she said. "As we've said before, that's not how the governor does business."

Rezko, 52, is charged with scheming with Levine to split a $1 million bribe for pushing approval of an $81 million hospital for Crystal Lake in McHenry County through the planning board. The board has enormous power because it can kill such proposals or give approval to start building.

Rezko also is charged with scheming with Levine to pressure kickbacks out of money management firms seeking to invest assets of the $30 billion fund that pays the pensions of downstate and suburban school teachers.

Rezko insists through his lawyers he had no part in such schemes.

Defense attorney Joseph J. Duffy says Levine's brain has been fried so badly by drug abuse that his memory is unreliable. Before the trial is over, Duffy is likely to add that Levine would say anything the prosecutors want to hear -- and save himself from a possible life sentence.

Two big political names that go back to Chicago's stormy Council Wars era have even come out at the trial.

Former Alderman Edward R. Vrdolyak was the chief antagonist to Harold Washington, the city's first black mayor, in the 1980s, when the battling in the City Council was so fierce Chicago was called Beirut on the Lake.

Alderman Richard Mell was a high-profile member of Vrdolyak's bloc who once got so excited about his differences with Washington that he climbed on top of his desk in the City Council chamber and jumped up and down. These days Mell is better known as Blagojevich's father-in-law.

Levine told the trial last week that he made payoffs to Vrdolyak for city contracts going back to the 1980s. The former alderman's attorney, Michael Monico, immediately called the claim "absolutely false."

Levine so far hasn't said anything about Mell.

But another witness, Sheldon Pekin, said it was Levine who told him to split a $375,000 finder's fee with Mell, who allegedly was unhappy because he wasn't sharing the spoils after his son-in-law had been elected governor.

On hearing of Pekin's testimony, Mell said he had never met the witness and had met Levine only once. The veteran Democratic ward committeeman added: "I don't know what spoils are."

In any case, Pekin says that Levine changed signals before the money changed hands and told him to deliver it to someone else.

As the trial got under way, political watchers across the country were attentive for anything that might drag Sen. Barack Obama into the case. Rezko had been a major fundraiser for Obama, a candidate for the Democratic presidential nomination.

But so far nothing has come up to put Obama anywhere near the alleged corruption.

The trial is now in recess for a one-week spring break.

Before federal Judge Amy J. St. Eve sent jurors home for the week though, Levine dropped another bombshell.

While he served on the pension board, it had been under the control of Springfield lobbyist-businessman-power broker William Cellini, he said.

He claimed that he had controlled the board through two people: himself and board executive director Jon Bauman. He said he helped Bauman get the job because he knew that Cellini wanted him.

"Jon Bauman was a person who would do what Mr. Cellini asked," said Levine.

Bauman, who continues to be the executive director of the board, told a reporter Friday afternoon that "to think that a person of questionable ability or integrity could take this position and stay in it for an extended period of time is illogical."

"In order to be successful in this position the director has to not only be competent but hold himself to a fiduciary standard of behavior," Bauman added.