Golden (42 page)

Levine spoke in detail about each fraudulent deal he helped steer through TRS, beginning with the Glencoe allocation with Sheldon Pekin. Levine had begun meeting with Pekin about the private equity firm in late 2002 and was interested to know that Pekin would be getting the finder's fee if Glencoe was able to get tapped into funds from TRS. Levine wasn't shy about asking to share the fee in exchange for helping Glencoe and arranged for his longtime associate Dr. Robert Weinstein to take in his fee and get some separation between himself and the illegal payment.

He talked to Cellini about it too, Levine said, and Cellini saw the potential deal as a way for him and Levine to ingratiate themselves with Rezko and Kelly, who clearly were the men to negotiate with in connection with the Blagojevich administration when the Glencoe deal was coming together in the spring of 2003. Cellini told Levine that Mell, Blagojevich's father-in-law, had been complaining about wanting to make money after Blagojevich's election, and this might be a way for cash to be directed to him. Rezko was feeling the pressure, Cellini had said, and this would mean good things if they were the ones to help him help Mell. Cellini had conversations with Rezko about it and learned that it was acceptable and that Rezko wanted an actual contract drawn up between Mell and the firm that would look real
and specifically mention that Mell wouldn't bring in any money in connection with state business.

Mell—who has always denied being involved in the deal—eventually withdrew, Levine said he was told. He met Rezko at his office and learned Rezko would choose someone else to get the money. Glencoe did receive $50 million in August 2003, but when the amount was split into two allocations of $25 million, Pekin only got to collect $250,000 and not $500,000 as Levine and the others had expected. Levine didn't want to go back and tell Rezko to expect less. So Levine took a hard line.

“I told Mr. Pekin that he had promised to pay a $250,000 fee, and that's what I expected him to pay,” Levine recalled, telling the jury that Pekin agreed. It meant Pekin would get nothing in that deal but still had the promise of getting future TRS business with Levine's assistance.

So at Rezko's direction, Levine had a consulting contract drafted between Pekin and Rezko associate Joseph Aramanda. A dummy version read that “X has agreed to retain the services of Y for the purposes of assisting X with identifying institutional investors who may have an interest in making investments in the private equity and other investment funds with whom X maintains a marketing relationship.” And while all the language made it seem like someone must be getting paid for doing something official, the entire document was concocted solely to make it look like Aramanda was being paid for something legitimate.

Levine saw dollar signs when he thought about them repeating the TRS model at other boards controlling pension funds. Pekin and Weinstein could start a business with the goal of collecting finder's fees, and Pekin and his son would be responsible for finding the firms that could accept investments. Levine could use Rezko's access to power to help steer those firms toward sure approvals. At the Illinois State Board of Investment in particular, Levine said, Rezko knew he could be helpful, because its board already contained many of his “friends” and its chairman had been helpful to the administration.

Rezko and Levine had their eyes on the State Universities Retirement System (SURS) as well, which handles the retirement benefits of university and college employees. Levine said he spoke to Rezko, who told him of his plan.

“That—ultimately at SURS there would become vacancies, trustees, whose terms would expire, and, at such times, he would have the opportunity to suggest appointments for new trustees,” Levine remembered. “And at such time that there was a controlling number of his friends, he might be able to do something at SURS.”

It was the prior month when Levine had met Rezko at the Standard Club at an intimate dinner where he had allegedly laid out what kind of money the two could make together at TRS and the Illinois Health Facilities Planning Board. Niewoehner had Levine describe that meeting in detail, as Rezko's attorney, Joe Duffy, objected to no avail.

Levine said he brought notes on several investments he was trying to line up for the TRS board meeting on May 24, and he seemed to have a good recollection of what had happened when he sat down with his political patron. “It was in a private room on the fourth floor that had a table in it that could seat six,” Levine testified. “It had a buffet with a telephone on it and the general things that a waiter would need to set up. And the table was set up for two people, with chairs one right next to the other.”

Levine said he told the waiter that once dinner had been served, he didn't want to be interrupted. He told Rezko that they had already made a good bit of money on the Glencoe and Mercy Hospital deals and they stood to make a lot more if all of Levine's various plans for the boards came together.

One deal involved a company called Stockwell, and Levine said he told Rezko he would be “very pleased” to see a $1 million finder's fee split three ways, between Weinstein, Rezko, and Pekin. Another was an $80 million allocation for JER, the real estate group that Cari had been dealing with in Virginia. Yet another was for Investors Mortgage Holding, Levine said, a company that lent money to developers and could be in line for as much as $200 million from TRS. That finder's fee could be as high as 2 percent, or $4 million, Levine said he told Rezko.

Capri Capital was supposed to be getting $220 million, although Levine and company would run headlong into the angry Tom Rosenberg before that plan would get airborne.

Levine acknowledged he didn't really need Rezko to do anything to make the deals happen, he just wanted to further ingratiate himself with the fundraiser and the Blagojevich administration. Rezko said nothing about being concerned about fees coming in the way things were laid out at the meeting, Levine said, and he certainly didn't raise a hand and ask whether it was legal. Levine said he simply finished explaining what he was planning, Rezko agreed, and Levine drove him home.

“And did you keep your notes from that session?” Niewoehner asked.

“No,” Levine said. “I ultimately destroyed them.”

Levine said he had met Rosenberg in the 1980s, and he, too, had done some lobbying on behalf of CompDent. Rosenberg had been a business partner of Tannenbaum, and Levine said that in exchange for supporting a $100 million TRS allocation for Capri in 2001, Levine had expected Rosenberg to pay him and Weinstein a fee. It was supposed to be $500,000, but instead Rosenberg just told Levine he no longer had to pay him anything to lobby for CompDent, and that was it. Levine took it as Roseberg backpedaling out of a deal, and he had never forgotten it.

So when Capri was lined up for the $220 million allocation in early 2004, Levine and his vendetta against Rosenberg decided to stall the TRS outlay. He told Niewoehner he had thought Vrdolyak, who spoke regularly to both Levine and Rosenberg, could be the conduit for Levine to finally get money out of his nemesis. Shortly before the Capri allocation was up for a vote, Levine said he told Bauman, TRS's executive director, that he knew Capri was actually on the block. Not disclosing a possible management change to TRS staff before getting an allocation was against the rules, so Rosenberg and Capri's investment money were shelved.

Within weeks of the meeting, a very unhappy Rosenberg reached out to Cellini to see if “Big Bill”could be of any help to him. Cellini then told Levine he thought messing with Rosenberg was probably a bad idea and reached out to Bauman to see if the situation could be fixed. But meanwhile, Levine said, he was already moving to tell Rezko and Kelly about Rosenberg and the $220 million, knowing that the pair would think it was a very interesting amount to be going to someone who had done nothing to help the Blagojevich administration, which could certainly think of more “loyal” people and firms to give it to. That spring, Levine told the fundraisers in a meeting at Rezko's office that Rosenberg was managing $1 billion in real estate for TRS.

Niewoehner asked what Kelly's reaction had been.

“Mr. Kelly's reaction was that … this was a company that should be contributing a great deal of money—or an individual who should be contributing a great deal of money—to Governor Blagojevich,” Levine answered. So the three decided that Rosenberg should be given a choice before the Capri deal could go ahead. Rosenberg could pay a $2 million finder's fee or raise $1.5 million in campaign funds. Levine was to tell Cellini that was the decision, Levine recalled, and Cellini would then inform Rosenberg about the behind-the-scenes machinations. Rezko believed that developer Allison Davis already had reached out to him on Rosenberg's behalf, though
Rosenberg would later dispute that idea. So Cellini could just tell Rosenberg that a Davis message that Rosenberg was willing to help the governor had been received and that he should call Levine, who would then put the fund-raising choice to Rosenberg.

To show the jury what happened next, Niewoehner walked Levine through the series of calls Levine had with Cellini in May 2004, including the one where Cellini described how a furious Rosenberg had said Rezko and Kelly could or should be under investigation for their fund-raising. In a second call, after Cellini had again heard from Rosenberg, Cellini said Rosenberg had told him he had found out that Davis had mentioned his name to Rezko as someone who could be asked to contribute to the campaign. Rosenberg had again flown off the handle and said he would never, ever go to Rezko or Kelly and that he would take the extortion attempt public if pressed.

The plan had started to come apart after word spread among the men that Rosenberg probably meant business with his threat, and Kelly in particular had gotten involved, at one point calling Levine and Cellini simultaneously on separate cell phones to set up meetings and conversations to try to clear things up.

Levine met with Rezko and Kelly in person on May 11 in Rezko's office, he testified, and Cellini joined in by phone. Kelly wanted to try to get tough with Rosenberg, but Rezko had advised everyone to take a breath, Levine recalled.

“Mr. Rezko felt that the situation should be dealt with dispassionately and that the situation should be disarmed, that Mr. Rosenberg was a dangerous individual and nobody wanted to be put in a dangerous situation,” Levine said. “And that nobody should talk with Mr. Rosenberg about a campaign contribution and that Mr. Rosenberg should get his allocation from TRS, but in fact, that should be the last business that Mr. Rosenberg does with the state of Illinois.”

Niewoehner also wanted to know about Cellini's mention on the call that “the big guy” was aware of that plan. What was Cellini saying?

“That the governor was aware of this, and he had indicated that Rosenberg means nothing to the governor,” Levine answered.

Levine had later spoken to Rezko about it at his office, too, he said.

“Mr. Rezko indicated to me that he had made the governor aware of the situation and the things that Mr. Rosenberg had said and that the governor agreed with the way Mr. Rezko wanted to handle it but that he felt that this
was the last thing that Mr. Rosenberg should get from the state,” Levine remembered.

By the time Joe Duffy got a crack at Levine, the calendar had turned from March to April, and he was more than ready. After Niewoehner finished up his last few questions, Duffy refused the offer of a break from the judge and instead launched right into his attack, giving Levine no chance to catch his breath.

“Mr. Levine, you have been involved in criminal activity your entire adult life, is that right?” Duffy asked.

“No, sir,” Levine answered.

OK then. In what part of Levine's adult life had he not been a criminal?

“In no part of my adult life was I not involved in criminal activity,” a suddenly puzzled Levine said.

If this was how it was going to go, there was a chance Duffy was going to be questioning Levine until Christmas, but the lawyer didn't let up. He had just asked the same question and gotten a different answer. So was Levine changing his answer for the jury?