Blagojevich Backer Charged in Pension Fund Kickback Scheme

October 12, 2006 ( - A federal indictment released Wednesday charges that Antoin "Tony" Rezko, a top fundraiser for Illinois Governor Rod Blagojevich, demanded millions of dollars in kickbacks from investment firms seeking state teachers' pension fund business.

A Chicago Tribune news report said that the new charges were contained in a superseding indictment against Stuart Levine, a former member of the pension board who is cooperating with federal authorities in a wide-ranging state corruption probe (See  Report: Illinois Pension Probe Focusing on GOP Bigwig ).

The indictment alleges that Rezko, one of Blagojevich’s closest advisers, schemed with Levine, who had been reappointed by Blagojevich to both the Teachers Retirement System board and the state board that oversees hospital construction, the Tribune report said. Levine has already been charged with using his position on those boards to extort financial firms and hospitals appearing before the panels.

“In the course of the scheme, Rezko and Levine solicited and demanded millions of dollars in undisclosed kickbacks and payments, and received and directed hundreds of thousands of dollars in undisclosed kickbacks and payments,” the indictment said, according to the Tribune.

The charging document alleges that in one instance Rezko and Levine shared in a kickback of about $1 million, from a contractor already indicted in the hospital board investigation, to assist a Wisconsin-based health company in receiving state approval to build a new hospital in Crystal Lake.

Rezko and Blagojevich met in the early 1990s when Blagojevich was a state representative from the Northwest Side, Rezko said last year in an interview with the Tribune. The two families also became close personally, with Rezko and Blagojevich’s wife, Patti, a real estate broker, working on several deals together and earning Patti Blagojevich at least $38,000 in fees.

According to the newspaper, after Blagojevich decided to run for governor, Rezko became one of his largest behind-the-scenes fundraisers. Following Blagojevich’s November 2002 victory, Rezko continued on as a member of Blagojevich’s “kitchen cabinet” of advisers, a small group of consultants who didn’t work for state government but who advised the governor on everything from policy issues to appointments to boards and commissions.