Jesse Jackson Jr. Denies Role in $6M Scheme to Bankroll Blagojevich

Jesse Jackson, Jr. photoRep. Jesse Jackson Jr., D-Ill., like his famous father, has become a Democratic Party kingmaker, both in Chicago and on Capitol Hill. He’s also, according to the September 21 Chicago Sun-Times, the mastermind behind a scheme to raise $6 million in campaign contributions for then-Illinois Democratic Governor Rod Blagojevich in return for a U.S. Senate appointment. The allegation, made by a Chicago-area businessman-fundraiser, Raghuveer Nayak, contradicts Jackson’s assertions that he hadn’t tried to buy Barack Obama’s pending vacant Senate seat in the weeks prior to Election Day 2008. The actual version of events may well determine whether federal prosecutors can secure multiple guilty verdicts against Blagojevich, convicted in August on only one of 24 corruption charges (lying to federal agents), with the other 23 resulting in a hung jury.

National Legal and Policy Center has extensively detailed how Blagojevich was at the center of a patronage machine whose participants included Chicago politicians on the make, such as future President Obama, and their paymasters, most of all convicted businessman Tony Rezko. Gov. Blagojevich, for several years under FBI surveillance as part of a probe of Chicago corruption, was deep in financial debt (along with wife Patti) and in ambition. He likened the prospect for long-term tenure as Illinois governor to being “stuck.” Though eyeing bigger game, “Blago” at least took comfort in knowing he held the cards in the appointment of Obama’s Senate successor.

There was a caveat, however: If a Democrat wanted to become a senator, he allegedly would have to prove his loyalty by contributing to the governor’s campaign chest. Blagojevich proved reckless as well as aggressive. In the wee hours of December 9, 2008, federal agents arrested him and his chief of staff, John Harris. A 76-page FBI affidavit released by the U.S. Attorney’s Office for the Northern District of Illinois indicated that Blagojevich had made self-incriminating statements on court-authorized wiretaps and listening devices. Harris would plead guilty to wire fraud in July 2009 in exchange for a reduced sentence and a promise to testify against his former employer. Blagojevich, meanwhile, was looking at the last weeks of his political career. In January 2009, the Illinois House of Representatives overwhelmingly voted to impeach him for official misconduct; later that month the Illinois Senate expelled him and permanently barred him from holding state office.

Gov. Blagojevich settled upon former State Attorney General Roland Burris to fill out the remainder of Obama’s Senate term. But there had been other alternatives. And in some way they were connected to a Syrian-born Chicago real estate mogul Tony Rezko. An article in the November 2007 issue of Chicago magazine explained: “Rezko became a virtual one-man headhunting firm for staffing the Blagojevich administration, sending along recommended candidates, many of whom ended up getting appointments.” Rezko was convicted in June 2008 on several counts in a massive contractor kickback scandal – he’s been sequestered and awaiting sentencing since. Obama’s Senate successor easily could have been one of his top White House advisers, Valerie Jarrett, the unnamed “Adviser B” contained in the FBI affidavit against Blagojevich. Harris’s wire fraud conviction last summer, in fact, had been based on a November 2008 phone conversation in which he discussed the possibility of getting Jarrett appointed to fill Obama’s seat, with financial help from the Service Employees International Union.

Congressman Jesse Jackson Jr. fits into this scene. As National Legal and Policy Center noted more than two months ago, Jackson was one of the persons to whom Gov. Blagojevich allegedly offered Barack Obama’s Senate seat for a price. Jackson, who won his House seat in 1995 in a special election, noted in December 2008, days after the governor’s arrest: “I never sent a message or an emissary to the governor to make an offer, plead my case, or propose a deal about a U.S. Senate race, period.” Yet court testimony this July 7 in Blagojevich’s trial ran counter to this statement. Rajinder Bedi, a businessman in Chicago’s large and growing Indian ethnic community, stated that he’d met with Jackson and Raghuveer Nayak, another Indian-ethnic local businessman and a fundraiser for Jackson and Blagojevich, at a downtown Chicago restaurant on October 28, 2008. Jackson allegedly expressed a clear interest in the seat at a price of $1 million. Former Deputy Governor Robert Greenlee said a few days later of Jackson during a recorded phone conversation with Blagojevich: “I’m tellin’ ya, that guy’s shameless.” Replied the governor: “Unbelievable, isn’t it…we approached, pay to play. That, you know, he’d raise me 500 grand, an emissary came, then the other guy would raise a million, if I made him a senator.”

It turns out that $1 million was on the low side, argues an article by Natasha Korecki, Chris Fusco and Lynn Sweet appearing in last Tuesday’s Chicago Sun-Times. The piece, titled “Fund-Raiser: Jesse Jackson Jr. Behind $6M Senate-Seat Scheme,” noted that the Oak Brook, Ill.-based Mr. Nayak, a one-time business partner of Jackson’s brother Jonathan, admitted to federal agents that Rep. Jackson directed him to tell Gov. Blagojevich of his intention to raise $6 million for the governor’s war chest if he could be assured of getting Obama’s vacant Senate seat. Nayak also admitted that at Jackson’s request he had, on two separate occasions, paid a Washington, D.C. restaurant hostess, Giovana Huidobro – a “social acquaintance” of Jackson – to fly out to Chicago. The FBI, in fact, had interviewed Ms. Huidobro about a year ago as part of its probe of Blagojevich in order to determine whether Jackson had asked Nayak to offer Blagojevich campaign cash in exchange for a Senate appointment.

Sources told the Sun-Times that Huidobro, Jackson and Nayak dined together in Washington on October 8, 2008 – the date mentioned by Nayak to federal authorities as his conversation with Jackson about the Senate seat. Afterward they retreated to Ozio, a nearby cigar-and-martini nightclub on M Street NW where Huidobro worked as a hostess; Jackson more than once had held fundraisers there. Prior to that evening, Nayak told investigators about a private conversation he had with Rep. Jackson. Jackson allegedly had asked him to tell Blagojevich that if he made him (Jackson) a U.S. senator, Chicago’s Indian community would raise $1 million for Blagojevich’s political campaign chest and, following the appointment, Jackson himself would raise another $5 million. Grand total: $6 million.

Jackson quickly condemned the Sun-Times story. “The very idea of raising millions of dollars for a campaign other than my own is preposterous,” he said. “My interest in the Senate seat was based on years of public service, which I am proud of, not some improper scheme with anyone.” In a radio interview a month ago about his possible entry into the mayor’s race, Jackson challenged prosecutors to “bring it on” if they have evidence of his involvement. As for his relationship with Ms. Huidobro, the congressman added: “The reference to a social acquaintance is a private and personal matter between me and my wife that was handled some time ago. I ask that you respect our privacy.” This tight-lipped, scripted response may be true, but it’s of more than passing significance that Jackson’s wife, Sandi Jackson, is a Chicago alderman and, like her husband, has expressed interest in running for mayor to replace the retiring Richard M. Daley. In other words, this is a power couple with every reason to keep inconvenient facts under wraps.

Federal prosecutors, led by Patrick Fitzgerald, might not have the raw material for an indictment against Rep. Jackson – at least not yet. And the congressman always can take pointers from his father, civil-rights activist and former presidential candidate Jesse Jackson Sr., a master of media and legal manipulation. But Rod Blagojevich and his lawyers have nothing to lose by subpoenaing Jackson as a witness if the feds put the fallen governor on trial again. Subpoena overkill was the defense strategy the last time around and likely will be again. The retrial is tentatively set for January. If Jackson is called as a witness (he wasn’t the last time), it’s going to be hard for him to dispute certain information dug up by Sun-Times reporters.

Related:

Testimony Highlights Blagojevich Financial, Ethical Problems.

Blagojevich Trial Puts Obama Closer to Senate Seat Deal.

Blagojevich Aide Harris Pleads Guilty, Agrees to Testify.

Illinois Senate Nominee Has Ties to Corrupt Chicago Locals.

Illinois Governor, Aide Arrested in Probe of Senate Appointment.