Curtain
Time For Barack Obama -
Part III
By Evelyn Pringle
16 May,
2008
Countercurrents.org
Read
Part II
Three
days after the Chicago Sun-Times reported that Aiham Alsammarae, the
former electricity minister convicted of corruption in Iraq, put up
$2.7 million in property to help raise $8.5 million to free Tony Rezko
from jail in Chicago, the Times reported that Alsammarae had contributed
six times to Obama's presidential campaign.
The April 29, 2008 report also noted that before he escaped from jail
in Bagdad in December 2006, and returned to Chicago, Obama's US Senate
office had sought information about Alsammarae from the State Department
on October 16, 2006 on behalf of Alsammarae's family while he was
being held in jail in Iraq.
As usual, when busted on the contributions given in January, February
and March, the Obama camp said it would donate Alsammarae's money
to charity and his spokesman, Ben LaBolt, put out the standard line
that Obama does not ever "recall" meeting Alsammarae.
The money missing due to Alsammarae's corruption in Iraq during the
two years he served as electricity minister between August 2003 and
May 2005 is estimated to be $2 billion.
The Operation Board Games investigation revealed that Alsammarae signed
contracts worth $200 million that benefited both Rezko and the Iraqi-born
billionaire, Nadhmi Auchi, who ended up with Riverside Park, a 62-acre
lot in the Chicago Loop estimated to now be worth $2.5 billion.
As noted previously in this series, understanding the connections
between Auchi and Riverside Park and all the players is the key to
understanding Operation Board Games. Financing deals in the Chicago
real estate industry were the focus of the investigation from the
start and the financing deals involving Riverside Park specifically.
On September 29, 2005, Crain’s Chicago Business news reported
that General Mediterranean Holding, “a Luxembourg-based conglomerate
headed by Nadhmi Auchi, is buying Riverside Park, a yet-to-be-built
development on a prime 62-acre parcel on Roosevelt Road,” quoting
Michael Rumman, the director of the Illinois Department of Central
Management Services, as a consultant on the project.
The sale price was estimated to be about $130 million. Joseph Ryan,
a local attorney representing GHM, told Crain's that Rezko would no
longer be an investor in the project, but “there’s a possibility
he may have a consultant’s role in the project."
Crain’s noted that Rezko and Auchi were introduced by a mutual
acquaintance in London, and said: "They teamed up recently on
a $150 million contract to build a power plant in Iraq."
"Auchi," Crain's also pointed out, "received a 15-month
suspended sentence in France after being convicted in 2003 for taking
kickbacks from French oil giant Elf."
"And U.S. officials are investigating allegations of bribery
involving a mobile phone contract in Iraq that recently was awarded
to Orascom, an Egyptian firm in which Mr. Auchi is a shareholder,"
the report stated.
On May 30, 2006 Crain’s reported that before the GMH deal, Rezko
and Daniel Mahru, former co-owners of the real estate firm Rezmar,
had piled up more than $100 million in debt on the property. “A
liquidity crisis in early 2005 resulted in a technical loan default,
property documents show, forcing the eventual sale to Mr. Auchi,”
the report said.
The plan
was to build 4,600 residential units and about 670,000-square-feet
of retail space on the site. However, the development has now been
stalled for years being the new owner Auchi is not allowed in this
country and several of his surrogates who were supposed to be developing
the project appear to be headed to prison.
Future plans are likely not good either being it’s doubtful
that many real estate developers in Chicago are eager to hook up with
Auchi and Riverside Park at this stage of the game.
Nobody knows Auchi anymore
When the news surfaced that Auchi had made a loan to Rezko a month
before Obama and Rezko entered into a real estate deal to buy a mansion
and lot for over $2 million in June 2005, rumors started flying about
a dinner held in Chicago at the exclusive Four Season’s Hotel
in April 2004, for Auchi and other investors from the Middle East,
attended by many top Illinois officials and Alsammarae.
Before long, the media was rehashing the fact that shortly after his
visit to Illinois, Auchi did invest $10 million with Rezko in Riverside
Park. On June 14, 2007, former Rezko associates told the New York
Times that Obama dropped in at the Four Season's event at Rezko's
request and his visit helped impress foreign guests.
“I remember that he had been on the campaign trail, and he was
completely wiped out and exhausted,” said Anthony Licata, identified
as an attorney who represented Rezko on real estate deals.
“My recollection is that he drank ice tea, and he talked about
how he was really making progress, and we were all excited to see
him,” Licata said.
Obama spokesman, Bill Burton told the Times it was not unusual for
Obama to be “shaking hands late in the Senate primary season.”
“If someone recalls meeting him during this period,” Burton
said, “Senator Obama has no reason to doubt it.”
Licata was an attorney for Riverside Park and an investor. He donated
$1,000 to Obama's senate campaign six months after the Four Season's
party and also gave $5,000 to the fund for Blagojevich's future presidential
bid.
On February 26, 2008, an aide to Obama told the Times of London that
Obama did attend an event at the Four Seasons but did not remember
meeting Auchi. "He shook a lot of hands and met a lot of people,"
the aide said. "We do not remember individual people."
Two days later, Bill Burton told the Times: "The bottom line
is Obama does not recall ever meeting him [Mr Auchi]."
All members of the “Combine,” have tried to distance themselves
from Auchi's visit because as previously explained, he is not allowed
in the US. However, the question that remains is how did he enter
this country in April 2004, after his 2003 conviction in France.
According to the February 28, 2008 Sun-Times: “Auchi's London-based
lawyer, Alasdair Pepper, wouldn't answer that."
"State Department and Homeland Security officials said they couldn't
comment,” according to the Times.
During a March 14, 2008 interview, the Times asked Obama: "Did
you ever help Auchi enter the country?"
He said, "No." But when asked the follow-up question of
whether “his office” helped Auchi enter the country, he
replied, "Not that I know of."
On January 28, 2008, Raw Story's Michael Roston reported that after
rumors began spreading that Auchi may have met with Obama, "In
what appears to be a clumsy "cleanup" operation evidence
of Auchi's visit to Illinois has now been deleted from two websites
linked to his company, General Mediterranean Holding."
The reports in the media always say Rezko hosted the Four Season's
event, when in fact Governor Rod Blagojevich directed the show.
ABC News first posted a link to photos showing Auchi meeting with
Blagojevich on the site, “Middle East Online.” The description
under a picture of Auchi and Blagojevich, still accessible on the
internet a month ago, stated: “Governor of the State of Illinois,
Mr Rod Blagojevich hosted an official reception in honour of Mr Auchi.”
Another picture, taken in the Chicago office of the President of the
Illinois state senate bears the title: “Illinois State Senate
President Mr Emile Johns Jr. meets Mr Auchi.”
Jones is often described as Obama’s “mentor.” On
February 26, 2007, the Washington Post noted that once he got to the
state Senate, Obama “became a political protege of current Senate
President Emil Jones, a 35-year veteran of the legislature and one
of the state's most influential black lawmakers.”
Obama avoided directly answering questions about Auchi and Alsammarae
until March 14, 2008, when he was asked whether he ever met them,
during an interview with the Sun-Times. In response, he said, "Tony
called and asked if I could stop by because he had a number of friends
that he had invited to dinner and he wanted me to meet them."
"I told him that I would be happy to come by if my schedule allowed
it," he said. "And it did."
But he said could not recall any names and apparently expects the
public to believe that he made a special trip to a private dinner
at an exclusive club and never thought to ask why Rezko was throwing
a shindig for “friends” from the Middle East, or why they
would want to meet an state senator from Illinois to begin with
However, this is exactly what the public is being led to believe due
to the fact that every time the subject comes up, the mainstream media
repeats this ridiculous fabrication.
To begin with, Obama has continuously claimed that Rezko never asked
him for favors. On November 5, 2006, the Sun-Times published his answers
to questions that were submitted to him after the news of the real
estate deal with Rezko surfaced, and Obama stated: “I have never
been asked to do anything to advance his business interests.”
A day later, on November 6, 2006, he told reporters in Waukegan Illinois,
“He had never asked me for anything. I'd never done anything
for him.”
In December 2006, he told the Washington Post: "I've known him
for 15 years."
“He had never asked me to do anything.”
In a March 14, 2008 interview with the Tribune, Obama was asked whether
he ever thought Rezko would expect something from their relationship,
and he stated: "No. Precisely because I had known him for years
and he hadn't asked me for something."
When asked why politicians were drawn to Rezko, he said: "In
my interactions with him, he was very gracious. He did not ask me
for favors."
Five days later, on March 19, Stuart Levine testified in the Rezko
trial and told the jury he had flown Rezko’s wife and children
back to Chicago on a private jet from a vacation in Mexico because
Rezko had to leave early to prepare for the dinner he was hosting
for Auchi in Chicago. Rezko was hoping to convince Auchi to invest
in Riverside Park, he told the jury.
Levine said he attended the dinner with other guests that included
Illinois Lt Governor Pat Quinn, Christopher Kelly, Jack Lavin, the
head of Blagojevich’s economic development agency, and Michael
Rumman, director of the Department of Central Management Services.
Levine’s testimony and reports in the media always sounded like
they were referring to one event at the Four Season‘s. But on
April 14, 2008, Levine dropped a bombshell, when in response to questions
for Rezko’s attorney, he testified that the dinner he attended
in Auchi’s honor was held at Rezko’s home and Obama and
his wife Michelle were there.
The Tribune's Gavel-to-Gavel noted that, “Rezko was trolling
for investment capital for a South Loop development, and the party
was part of his campaign to get Auchi to invest.”
The Associated Press ran a follow-up story on April 14, 2008, calling
Auchi a "mysterious billionaire with his hands on a major chunk
of Chicago real estate," and described his arrival in Illinois
in April 2004, as a major event in which Lt Governor Quinn “headed
a welcoming delegation that greeted Auchi when his private plane touched
down at Chicago's Midway Airport.”
The article noted that Quinn personally rode downtown with Auchi and
his family and that Quinn said he later attended the party for Auchi
held at Rezko's home. The article also mentioned that Auchi was the
guest of honor at another lavish dinner party at the Four Seasons,
and said, “Blagojevich was on hand for the festivities and posed
for photos with the visiting tycoon.”
However, Blagojevich spokeswoman Abby Ottenhoff was quick to tell
the Press: "He has not met with or talked to Mr. Auchi since
then."
When Senate President Jones was asked if he remembered meeting Auchi,
he asked: "Who?"
"I don't know who he is," Jones told the Associated Press.
Regarding the photo of him and Auchi, Jones' press secretary said:
"It was strictly a grip and grin."
"He doesn't even remember it."
The line from Obama spokesman, Ben LaBolt, was again: "As he
has said previously, Senator Obama does not recall meeting Nadhmi
Auchi at any time or on any occasion, and this includes any event
that may have been held for Mr. Auchi."
"Senator and Mrs. Obama have no recollection of attending any
such event," he stated.
But on April 16, 2008, Sun-Times columnist, Michael Sneed, reported
that Obama had even made toasts at Rezko's party, and wrote:
“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!”
In an April 26, 2008, interview with Tribune reporter, John McCormick,
Obama did not deny that he and Michelle were at the party but said
he did not recall being there, stating:
"I have to say that I just don't recall it. I mean this has been,
I guess, four years ago. My understanding, through his lawyer, Mr.
Auchi doesn't recall meeting me and you know, I can't speak for other
people's recollections.
“But I've said publicly, on many occasions, that I had a social
relationship with Mr. Rezko."
The last comment is ridiculous because what Obama has said on “many
occasions,” is he only had lunch or breakfast with Rezko once
or twice a year and he and Michelle had dinner with Rezko only three
or four times in the 15 years they knew each other. When asked whether
Rezko may have been using him to impress potential investors, Obama
replied:
"I just don't have a recollection of the event. As I said, I
was in the middle of running a U.S. Senate race. So, you know, I was
speaking all the time, probably six, seven, eight times a day."
“Right,” McCormick said, “but why go to this event
that was specifically designed for Rezko investors?”
"As I said, I have no recollection of the event. Alright?"
Obama replied. When asked whether he would remember making a toast
to Auchi, Obama stated:
"I'm fairly certain I would remember giving a specific toast
to somebody. Keep in mind, though, that this was right in the midst
of my U.S. Senate campaign, so I was doing three or four events a
day.
“So, I mean, there were very few events where I wasn't speaking
on anything. But I have no recollection of this particular event."
However, the Tribune has obtained a copy of an Obama "upcoming
events" schedule on his old Senate campaign web site which shows
Obama had no personal campaign activities on April 3, 2004, the day
of the party.
Riverside Park funds legal defense for Board Games defendants
Although revelations about the $3.5 million loan immediately prior
to the Rezko-Obama real estate deal led to a few stories in the press,
it was Auchi’s second $3.5 million loan in April 2007, that
drew the most headlines after Rezko was thrown in jail in January
2008.
After he was indicted, Rezko claimed he was flat broke and was living
off $7,500 a month from friends and family. In a November 17, 2006
letter to the court, his attorney reported there were no assets being
held in his name or for his benefit abroad, and that, other than an
inactive contract in Iraq, he “has no foreign assets, or holdings,
or business interests.”
Rezko even told the court he had no money for his legal defense. In
a hearing on January 16, 2007, the judge asked Rezko: “How are
you paying Mr. Duffy?”
“I have been very fortunate to have the family I have and to
have some friends that I have. I've been very fortunate,” he
said.
“So, family members and friends of paying your legal bill?”
she asked. “Yes, your Honor,” Rezko replied.
“I can confirm that, your Honor,” Duffy told the judge.
He went on to tell the court that he had met with members of Rezko’s
church, and they “have been extremely supportive and have come
forward.”
“Mr. Rezko has not provided us any money since his indictment,”
Duffy told the court.
Rezko also told the judge Rita Rezko had sold the lot next door to
Obama but had not received a dime. “Your Honor,” he said,
“my wife sold the land, too, in Hyde Park the last few weeks.”
“Did she personally own it or did an L.L.C. own it?” the
judge asked. “She owned it in a trust, I believe,” Rezko
said.
“How much did she get for the land?” the judge asked.
“A hundred-twenty-thousand was in excess of the mortgage on
the land, and that hundred-twenty-thousand went all in full to the
buyer for a previous debt,” Rezko said.
“So, she didn't walk away with any cash?” the judge asked.
“Not one dollar,” he stated.
"Other than the 62 acres, your Honor, I do not have any other
assets," Rezko told her.
“If the property is sold today for $200 million," he said,
"I will not receive one dollar from the proceeds."
The judge specifically asked whether he could get Auchi to wire him
say $100,000 if he wanted it and Rezko basically said he did not know
because he never asked.
However, Duffy told the judge, “although he has a personal relationship
with the Chairman -- or he believes he does -- I want you to understand
I don't think Mr. Rezko could call up on the phone and ask for favors
or money from them.”
At a February 27, 2007 hearing, regarding Riverside Park, the judge
told Rezko: "If something changes–and I believe I have
advised you of this or ordered this before, but if not I want to make
clear. If something changes with respect to the status of the 62 acres
that we talked about and that I asked you multiple questions on, you
must notify the Court immediately."
Rezko was allowed to remain free after posting $2 million bond secured
by properties of family and friends. But in January 2008, the judge
was informed that Auchi was funneling money from foreign banks via
the Chicago law firm of Freeborn & Peters, to fund Rezko’s
legal defense and she threw him in jail.
In the motion to revoke bail, prosecutors said Rezko "has had
a long-standing relationship" with the Freeborn. Freeborn has
represented Rezko “in litigation with franchisor Papa John’s
Pizza,” and “appears to represent Rezko in currently pending
civil litigation,” they wrote.
The government alleged the wire transfers showed Rezko had access
to overseas funds that could enable him to flee and hide out in countries
without extradition treaties with the US. In the motion, prosecutors
said Rezko's obtaining money originating in Lebanon was consistent
with his continuing ties to the Middle East and overseas travel, and
noted that:
“Between approximately November 2005 and October 2006, Rezko
took multiple trips to Saudi Arabia, United Arab Emirates, Jordan,
and Qatar.
“Several of Rezko's overseas trips included Rezko traveling
through, and spending time in, Syria and Lebanon. The United States
does not have extradition treaties with Saudi Arabia, United Arab
Emirates, Qatar, Syria, or Lebanon.”
"Through records from Northern Trust Bank,” prosecutors
wrote, “the government has learned there was an approximately
$3.5 million wire transfer in April 2007 of which a substantial portion
immediately was directed to Rezko’s relatives."
Northern Trust being the same entity holding the confidential Land
Trust for Obama‘s mansion and 10-foot lot. Prosecutors said
within a week, the $3.5 million was moved to another account at Northern
Trust, the “client fund account,” held by the Freeborn
firm.
A brief filed by Rezko on January 29, 2008, said, "his business
partner had agreed to loan him $3.5 million for legal expenses and
to support his family pending trial."
In fact, $1.9 million went to law firms. In addition, on July 25,
2007, GMH wired an additional $200,000. “This transfer was also
apparently for Rezko’s legal fees,” prosecutors wrote
in their motion. Another $200,000 went to reimburse people who had
advanced money for legal fees or living expenses and at least $89,000
was paid to other attorneys and accountants, according to the filings.
In the motion, prosecutors also told the court: "Contrary to
Rezko's November 2006 representation to the court that he had no business
interests abroad," a confidential informant, "informed the
government that Rezko has been interested in working on real estate
deals in Syria on property owned by Auchi."
According the informant, “Auchi owned 3 or 4 properties, including
one commercial retail shopping center, and Rezko was interested in
assisting in the development of the property."
The motion further stated, “Rezko has repeatedly informed the
Court that his interest in the 62-acre Property is illiquid, speculative,
and only subject to his getting value from it after satisfaction of
large prior existing debts.”
Specifically, that it remains to be determined whether this asset
is of significant value, and “how that value can be liquidated
given the project’s value is tied to the development of what
is currently a 62 acre vacant lot,” prosecutors noted.
The motion goes on to state that in contrast to Rezko’s representations,
the government learned that “in September 2006, just a few months”
before Rezko represented that his interest was illiquid and speculative,
“Rezko attempted to post as collateral for a loan part of his
interest in the 62 Acre Property.”
“Further,” prosecutors wrote, “on December 12, 2007,
the government obtained documents that indicate that Rezko has transferred,
restructured, and/or sold significant portions of his interest in
the 62 Acre Property.”
Specifically, they noted that an August 10, 2007, Settlement Agreement,
signed by Rezko and Christopher Kelly showed Rezko transferred "a
portion of his interest" in Riverside Park to Kelly in exchange
for the forgiveness of approximately $1.7 million in loans that Kelly
made through his business to Rezko between late 2002 and 2006.
Even more troubling, prosecutors said, between January 2007 and August
2007, "unbeknownst to at least the government," Rezko liquidated
an additional 60% share of the company that held Rezko ownership in
Riverside Park to General Mediterranean Holdings affiliate, Orifarm.
Although many creditors are waiting to be paid from Rezko's sale of
Riverside Park, prosecutors said, it appears "Rezko is handpicking
the creditors that will be repaid while other creditors," some
who are owed considerably more than Kelly, "are unaware that
Rezko's one remaining significant asset is being distributed in a
manner that will impede their ability to be made whole."
A few days later, prosecutors were no doubt outraged to learn that
Auchi had apparently become legal defense fund for Board Game defendants
who keep the secrets. On February 7, 2008, Mike Robinson reported
another: “Indicted Blagojevich fundraiser got loan from Iraqi
billionaire,” in the Associated Press.
Christopher Kelly “has arranged to get a loan from the same
Iraqi billionaire whose $3.5 million payment got another member of
the governor's inner circle thrown in jail," he wrote. Kelly
received the loan five days before Rezko‘s bail was revoked,
and he pledged all of his shares in a Nevada land partnership as collateral,
Robinson found.
On April 14, 2008, the Associated Press noted that in 2005, reports
in Chicago said Auchi had purchased the entire property, but “it
seems Rezko was able to hang onto at least some shares in the land
through the Riverside Development Corp.”
“Court papers say that the $3.5 million wired to Rezko's lawyers
by Auchi was a loan that was erased in exchange for shares in the
62-acre property,” the report wrote. “And they say Auchi
had planned at the time to pay $4 million more for the rest of the
tract.”
"All the loans and interest have now been paid by Mr. Rezko by
means of the transfer of shares" to my client, Auchi’s
attorney told the Associated Press. "Mr. Rezko has no remaining
shareholding in the development," he said.
However, Joe Cacciatore told the Associated Press that he was a partner
with Rezko in Riverside Park before Auchi showed up, and has not seen
any money as a result of the sale. Cacciatore has filed a lawsuit
against his former partners, according to the article.
Carriatore says he met Auchi at an "Obama fundraising party"
Rezko gave at his home several years ago. "He was well dressed,"
he told the Press. "He seemed distinguished."
According to Obama, Rezko only hosted one fundraising party at his
home in July 2003. So exactly how many times did Obama party with
Auchi?
[email protected]
(Evelyn Pringle is a columnist for OpEd News and an investigative
journalist focused on exposing corruption in government and corporate
America)