T Nation

Obama and Rezko

This is going to come up soon enough, given the investigation - so let’s see what there is to know:

[i]Obama and Chicago Mores
By JOHN FUND
March 3, 2008; Page A17

On Tuesday, Barack Obama may well wrap up the Democratic nomination. Yet how he rose so quickly in Chicago’s famously suspect politics – and who his associates were there – has received little scrutiny.

That may change today as the trial of Antoin “Tony” Rezko, Mr. Obama’s friend of two decades and his campaign fund-raiser, gets under way in federal court in Chicago. Mr. Rezko, a master fixer in Illinois politics, is charged with money laundering, attempted extortion, fraud and aiding bribery in an alleged multimillion dollar scheme shaking down companies seeking state contracts.

John McCain’s dealings with lobbyists have properly come under a microscope; why not Mr. Obama’s? Partly, says Chicago Tribune columnist John Kass, because the national media establishment has decided that Chicago’s grubby politics interferes with the story line of hope they’ve set out for Mr. Obama. Former Washington Post reporter Tom Edsall, who now teaches journalism at Columbia University, told Canada’s Globe & Mail that “reporters have sometimes allowed themselves to get too much caught up in [Obama] excitement.” Then there are Chicago Republicans, loath to encourage the national party to pounce because some of their own leaders are caught in the Rezko mess.

For its part, the Democratic Party may once again nominate a first-time candidate they haven’t fully vetted politically. Democrats flocked to Michael Dukakis in 1988, ignoring Al Gore’s warnings about Willie Horton; later they were blindsided by revelations about Bill Clinton after he was elected president.

This year, Hillary Clinton made a clumsy attack on Mr. Rezko as a “slum landlord” during one debate. But her campaign has otherwise steered clear – at least until last Friday, when Howard Wolfson, a top Clinton aide, suggested to reporters on a conference call that “the number of questions that we don’t know the answers to about the relationship between Mr. Rezko and Mr. Obama is staggering.” Mr. Obama’s campaign told me they have answered all questions about Mr. Rezko and have no plans to release any further records.

Mr. Obama has admitted that the 2005 land deal that he and Mr. Rezko were involved in was a “boneheaded” mistake, in part because his friend was already rumored to be under federal investigation. The newly elected Mr. Obama bought his $1.65 million home on the same day, June 15, that Mr. Rezko’s wife bought the plot of land next to it from the same seller for $625,000. Seven months later she sold a slice of the land to the trust that Mr. Obama had put the house into, so the senator could expand his garden.

Mr. Obama has strenuously denied suggestions that the same-day sale enabled him to pay $300,000 under the house’s asking price because Mrs. Rezko paid full price for the adjoining lot, or that he asked the Rezkos for help in the matter. Both actions would be clear violations of Senate ethics rules barring the granting or asking of favors.

Still, there are anomalies. Mr. Obama admits that he and Mr. Rezko took a tour of the house before it and the adjoining plot were sold. Financial records given to federal prosecutors a year later show Mrs. Rezko had a salary of only $37,000 and assets of $35,000. In court proceedings at that time, to explain how much his bail should be, Mr. Rezko declared that he had “no income, negative cash flow, no liquid assets.”

So where did the money for Mrs. Rezko’s $125,000 down payment – and the collateral for her $500,000 loan from a local bank controlled by Amrish Mahajan, like Mr. Rezko a Chicago political fixer – come from?

The London Times reports that, three weeks before the land transactions, Nadhmi Auchi, an Iraqi billionaire living in London, loaned $3.5 million to Mr. Rezko, who was his Chicago business partner. Mr. Auchi’s office says he had “no involvement in or knowledge of” the property purchase. Mr. Auchi is a press-shy property developer (estimated worth: $4 billion) who was convicted of corruption in France in 2003 for his involvement in the Elf affair, the biggest political and corporate fraud inquiry in Europe since World War II. He was fined $3 million and given a 15-month prison term that was suspended provided he committed no further crimes.

Mr. Auchi was also a top official in the Iraqi oil ministry in the 1970s. He has for years vigorously denied charges he had dealings with Saddam Hussein after the first Gulf War. However, an official report to the Pentagon inspector general in 2004 obtained by the Washington Times cited “significant and credible evidence” of involvement by Mr. Auchi’s companies in the Oil for Food scandal and illicit smuggling of weapons to the Hussein regime.

In 2003, Mr. Auchi began investing in Chicago real estate with Mr. Rezko. In April 2007, after his indictment, Mr. Auchi loaned another $3.5 million to Mr. Rezko, a loan that Mr. Rezko hid from U.S. Attorney Patrick Fitzgerald’s office. When Mr. Fitzgerald learned that the money was being parceled out to Mr. Rezko’s lawyers, family and friends, he got Mr. Rezko’s bond revoked in January and had him put in jail as a potential flight risk.

In court papers, the prosecutor noted that Mr. Rezko had traveled 26 times to the Middle East between 2002 and 2006, mostly to his native Syria and other countries that lack extradition treaties with the U.S. Curiously, Mr. Auchi has also lent an unknown sum of money to Chris Kelly, who, like Mr. Rezko, was a significant fund-raiser for Illinois Gov. Rod Blagojevich (himself under investigation by a federal grand jury as an alleged beneficiary of the Rezko shakedowns). Mr. Kelly is himself under indictment for obstructing an IRS probe into his activities.

Mr. Obama says he has “no recollection” of meeting Mr. Auchi during a 2004 trip the billionaire made to Chicago, and no one believes he knew of his background. While his name will come up in the trial as a beneficiary of Rezko donations (since donated to charity), Mr. Obama will not be called to testify.

There may be nothing more in Mr. Obama’s dealings with Mr. Rezko beyond an “appearance of impropriety.” Still, Mr. Obama does have an obligation to explain how he fits into Chicago politics. David Axelrod, Mr. Obama’s Karl Rove, is a longtime spoke in the Daley machine that’s dominated Chicago for a half century. Gov. Blagojevich, also part of the machine, shared key fund raisers with Mr. Obama.

“We have a sick political culture, and that’s the environment Barack Obama came from,” Jay Stewart, the executive director of the Chicago Better Government Association, told ABC News. He notes that, while Mr. Obama supported ethics reforms as a state senator, he has “been noticeably silent on the issue of corruption here in his home state, including at this point, mostly Democratic politicians.”

Mr. Obama will eventually have to talk about Illinois, if only to clear the air. After John McCain last month was attacked for cozy ties to lobbyists, he held a news conference and answered every question. Hillary Clinton held a White House news conference on Whitewater and her cattle futures. Mr. Obama must do the same for questions about Mr. Rezko and “the Chicago way” of politics. If he doesn’t, they may increasingly haunt his candidacy.

Mr. Fund is a columnist for WSJ.com.

See all of today’s editorials and op-eds, plus video commentary, on Opinion Journal.[/i]

Robert Novak, covering the same territory:

http://www.townhall.com/columnists/RobertDNovak/2008/03/03/obamas_former_friend

[i]Obama’s Former Friend
By Robert D. Novak
Monday, March 3, 2008

WASHINGTON, D.C. – As Sen. Barack Obama nears the Democratic presidential nomination, a corruption trial of his former fund-raiser Antoin (Tony) Rezko on charges of influence peddling begins in Chicago today (Monday). Sen. Hillary Clinton’s operatives have tried frantically, but not effectively, to interest U.S. news media outside Chicago in Obama’s possible connection with his home state’s latest major scandal.

Obama bought a mock Georgian mansion on Chicago’s south side on June 15, 2005, the same day Rezko’s wife bought a plot next door from the same seller. Obama then purchased from Rezko another parcel at above-market value. Federal prosecutors recently revealed that Nadhmi Auchi, an Iraqi billionaire who lives in London, wired $3.5 million to the financially strapped Rezko in Chicago less than a month before the Obama-Rezko purchases. James Bone, investigative reporter for the Times of London, wrote last Tuesday that “the money transfer raises the question of whether funds” from Auchi “helped” Obama buy his house.

This is what candidate Clinton had in mind after losing Iowa’s caucuses when she claimed Obama had not been properly “vetted” to be president. For months prior to that, her agents had hinted darkly that Obama’s past could be used by Republicans when the time came. But these were only hints, because of fear that explicit revelations would backfire against Clinton.

The closest Clinton has come to openly raising Obama’s connections with Rezko was during the Congressional Black Caucus presidential debate Jan. 21. “I was fighting” against “bad” Republican ideas, she told Obama, “when you were practicing law and representing your contributor, Rezko, in his slumlord business in inner-city Chicago.” In fact, Clinton messed it up. Rezko was not a client of Obama’s firm and was not a slumlord. Accused of racial insensitivity, Clinton dropped the issue.

Howard Wolfson, Clinton’s sharp-tongued communications director, was not giving up and was more precise than his candidate Feb. 14, when interviewed by “National Journal On Air.” He contended: “There are many questions … about his relationship with indicted political fixer Tony Rezko that he could answer, that he has not. What was the exact nature of his relationship with Mr. Rezko? … How much money did Mr. Rezko bundle for him? … What favors did Sen. Obama perform for Mr. Rezko?”

Clinton agents have shopped this story around the news media since her 10-state losing streak started. A “Rezko Watch” blog attacks both Rezko and Obama daily, while alleging connections between them. The blog appears to be written by a self-styled “citizen journalist” who calls himself “B Merryfield” and dispenses the straight pro-Clinton line.

Obama has conceded his simultaneous home purchase with Rezko was a “boneheaded” mistake. He is returning $150,000 raised by Rezko and his associates, and is contributing to charity $72,650 in Rezko contributions. Asked by Tim Russert on NBC’s “Meet the Press” last Nov. 11 why he was “associating with such a person,” Obama replied, “There was no evidence of wrongdoing,” but added, “There’s no doubt that it was a mistake on my part.” He made clear he had cut off all contact with Rezko “since he got in trouble with the law.”

But the case against Rezko prepared by the always determined U.S. Attorney Patrick Fitzgerald poses possible new pitfalls for the Democratic front-runner by introducing into the proceedings Auchi, who has been convicted on corruption charges in France and given a suspended sentence. While his friends describe Auchi and his family as victims of Saddam Hussein’s tyranny, Pentagon sources call him a “bagman” who laundered money in London for the Iraqi dictator.

Chicago Sun-Times reporters Chris Fusco and Tim Novak asked last week how it was possible for Auchi to get government permission to visit Chicago in 2004 despite his French criminal conviction. Obama aides were quoted as saying Auchi never reached out to the senator, and representatives of both men say neither has any recollection of meeting the other. But the Times of London reported last week that “the two may have had a brief encounter” at the Four Seasons Hotel in Chicago. It is an indistinct part of an indistinct story Hillary Clinton’s handlers wish had attracted attention before now.


Robert Novak is a syndicated columnist and editor of the Evans-Novak Political Report[/i]

A more amusing bit here:

http://www.suntimes.com/news/sneed/896844,CST-NWS-SNEED16.article

[i] Which is it? Obamarama . . .

April 16, 2008

BY MICHAEL SNEED Sun-Times Columnist

A Pinocchio problem? To fib . . . or is it a faulty memory?

�?� �?� To wit: Dem presidential contender Barack Obama’s handlers may be telling the press Obama has NO “recollection” of a 2004 party at influence peddler Tony Rezko’s Wilmette house, but a top Sneed source claims Obama not only gave Rezko’s guest of honor, Iraqi billionaire Nadhmi Auchi, a big welcome . . . but he made a few toasts!

�?� �?� Trial file: The name of Auchi, who was banned from the U.S. in 2005, according to court papers, surfaced at Rezko’s trial Monday. (Top Illinois businessman and Rezko pal Bill Cellini, whose name has also surfaced at the trial, was also at the Rezko party.)

�?� �?� The Quinn bin: Lt. Gov. Pat Quinn apparently is the only one with a good memory and admitted being at the Rezko party, attending late, and welcoming Auchi on behalf of the state of Illinois.

…[/i]

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Mr. Barrister I thank you for your post and links. Your my daily news

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Rezko update:

http://www.talkleft.com/story/2008/4/28/18049/7580

This last bit is interesting:

[i]The Sun Times also reports that the Judge and lawyers have been working hard to keep Barack Obama’s name from surfacing in the trial.

Maloof is testifying under a grant of immunity. More on that here: http://blogs.suntimes.com/rezko/2008/04/rezko_trial_obamas_name_kept_h.html
[/i]

BB

If Obama is implicated in some of Rezko’s shennanigans do you think he will get a free pass?

He doesn’t publicly appear to be concerned about this. I don’t jnow if McCain will make it an issue. Rove certainly would have.