Another oldie but goodie in the Rezkowatch/RBO archive is the sordid tale of favors Barack Obama did for his former employer, Allison S. Davis, and friend, campaign fund bagman, and personal real estate fairy, Tony Rezko.
Number One: A 1998 Letter
In an April 23, 2007 Chicago Sun-Times interview, Senator Barack Obama answered a series of campaign questions.
Obama was asked about the business relationship between his former boss, Allison Davis, and indicted political fixer Antoin “Tony” Rezko (Davis is named as “Individual BB” in Tony Rezko’s court documents):
- Q: Allison Davis and Tony Rezko have been business partners for years. When did the senator become aware of their business relationship? Was it before he went to work for the law firm? Did the senator work on any legal cases involving companies or entities jointly owned by Tony Rezko and Allison Davis?
A: Mr. Davis is no longer a partner at the firm. Senator Obama did not know about a business relationship between Allison Davis and Tony Rezko while Mr. Davis was at the firm.
Tim Novak wrote June 13, 2007, that Obama returned to Chicago after graduation from Harvard Law School and “joined Davis’ small law firm … which specialized in helping developers build housing for the poor. Five of those deals included Rezko’s company, Rezmar Corp. Those Rezmar projects ran into trouble. Some buildings ended up being boarded up. Some went into foreclosure.
“While Obama served in the Illinois Senate, he continued to work for the law firm, which Davis left in 1997 to become a developer.”
Novak wrote that “nearly nine years ago” letters written by then-Illinois State Senator Obama “for the first time show” Obama “did a political favor for Rezko”. Obama’s letters “to city and state officials supporting his political patron Tony Rezko’s successful bid to get more than $14 million from taxpayers to build apartments for senior citizens” included a $855,000 deal in “development fees for Rezko and his partner, Allison S. Davis, Obama’s former boss, according to records from the project, which was four blocks outside Obama’s state Senate district.”
As Novak wrote at the time, both Rezko and Obama denied that there was a political favor involved and Davis couldn’t be reached for comment.
Obama’s campaign confirms he backed Rezko project
The Associated Press reported on June 13, 2007, that, although Obama “has said that he never used his office to do favors for Rezko,” his campaign stated that in October 1998 he was an Illinois State Senator “when he wrote to housing officials … in support of a proposed apartment building for senior citizens four blocks outside of his district, according to records from the project.”
Rezko and Davis ran the project’s development company, New Kenwood LLC. The development opened in 2002 and ended up costing $14.6 million in taxpayer money, including $855,000 in development fees for New Kenwood,” the Chicago Sun-Times reported.
In the campaign’s statement, Obama said that
- … the nine-year-old project was needed because it provided housing for senior citizens on Chicago’s South Side.
“Barack Obama supported this important project nine years ago because it filled an important need and because of the potential it showed to provide health services in the community,” the statement said. It also noted that a number of other community leaders and elected officials backed the plan.
In his October 1998 letters to state and city officials on Illinois Senate stationary, Obama noted that the proposal by New Kenwood would “include a home health-care service, adult day care and a wellness center for seniors.”
“This project will provide much needed housing for Fourth Ward residents,” the letters said.
According to Bill Burton, Obama’s press secretary, “Rezko never asked Obama to send a letter having anything to do with the New Kenwood apartment plan.” Joseph Duffy, Rezko’s attorney, told the Chicago Sun-Times: “Mr. Rezko never spoke with, nor sought a letter from, Senator Obama in connection with that project.”
Number Two: A $1 million charity “gift”
In 2007, Allison Davis told Tim Novak that “he didn’t recall how or when” he met Tony Rezko. However, Illinois State Board of Elections records indicate that as early as July 1995 Rezko knew who Obama was.
On July 31, 1995, Rezko Foods contributed $1,000 to the Friends of Barack Obama political campaign fund.
Records show that on January 14, 1997, Rezko’s Rezmar Corp contributed $1,000; on January 13, 1997, Rezmar Concessions contributed $1,000; and on July 29, 1997, Rezmar Corp contributed $1,500.
Conclusion? Even if Davis couldn’t recall in April 2007 “how or when” he had met Tony Rezko, Illinois records clearly indicate that in 1995 and 1997 their paths would surely have crossed through at least one person they had in common — Barack Obama.
This happenstance would indicate that in 1995 Rezko was sufficiently well enough acquainted with Obama to contribute to his political campaign. Rezko’s $1,000 contribution in 1995 was significant. Records show that there were 112 itemized Individual Contributions totaling $37,735.00, making Rezko’s $1,000 stand out among the few contributions that were in excess of the majority, which were more in the $150, $300 and $500 range.
Additionally, these early political contributions predate the October 1998 letters that Obama wrote on Rezko’s behalf to housing officials “in support of a proposed apartment building for senior citizens four blocks outside of his district,” a project overseen by Obama’s former boss, Allison S. Davis, who ran the project’s development company, New Kenwood LLC.
The Chicago Sun-Times reported in June 2007 that together Rezko and Davis ran the project’s development company, New Kenwood LLC, with the “development open[ing] in 2002 and end[ing] up costing $14.6 million in taxpayer money, including $855,000 in development fees for New Kenwood.”
While the Kenwood project was on-going, Obama was serving as an Illinois State Senator, on the board of the Woods Fund of Chicago charity, and still working for the law firm that represented Davis, his former boss and “a small contributor to Obama’s political campaign funds,” Tim Novak reported November 29, 2007, in the Chicago Sun-Times.
In 2000, Davis came to Obama “looking for money … to help fund his plans to build housing for low-income Chicagoans,” Novak wrote. Obama, who left the Woods Fund in 2002, agreed.
- He voted with other directors of the Woods Fund of Chicago to invest $1 million with Neighborhood Rejuvenation Partners L.P., a $17 million partnership that Davis still operates
It’s not clear whether Obama told other board members of his ties to Davis, whose family would go on to donate more than $25,000 to Obama’s political campaigns, including his bid to be president of the United States.
“Let me get back to you on that,” Obama presidential campaign spokesman Bill Burton said when asked about that … He never did.”
Novak wrote that the Woods Fund “has no records to show whether the board knew about Obama’s ties to Davis, said Woods Fund president Deborah Harrington. … Under its agreement with Davis, Harrington said, the fund cannot disclose how Davis has spent the money. … Davis declined to comment.”
Was this a direct political favor for Rezko? Yes. Although Novak reported that it was Obama’s former boss, Davis, who asked for Obama’s help, Davis was not asking on his own behalf. He was asking for Obama’s assistance in obtaining the money for the development company which he owned and operated jointly with Rezko. It was the company that benefitted from the funding, not just Davis.
Number Three: Training Iraqi security guards in Illinois
This was in relation to the now-inoperable Iraqi power plant contract Rezko had cooked up with fellow Chicagoan and classmate Aiham Alsammarae, who was wanted in Iraq for the theft of reconstruction funds.
This constitutes a third political favor in which Obama was involved for his political patron, Rezko.
Tim Novak wrote August 7, 2007, in the Chicago Sun-Times:
- Two years ago, Iraq’s Ministry of Electricity gave a $50 million contract to a start-up security company owned by now-indicted businessman Tony Rezko and a onetime Chicago cop with a checkered financial past.
Within a month, an Iraqi leadership change left the deal in limbo.
Now the company, Companion Security, is working to revive its contract to train Iraqi power-plant guards in the United States.
Companion found support last summer from [former] Gov. [Rod] Blagojevich, whose staff offered to let the company lease a military facility in western Illinois. Since then, Companion has been lobbying officials from Washington to Baghdad about its Iraqi deal, according to documents. [...]
After the state found a proposed training site, Frawley went to Sen. Barack Obama (D-Ill.) [in August 2006]. [...]
“The Senate staff had two meetings, one conference call, and sporadically e-mailed with representatives of Companion Security about their request for Sen. Obama to write a letter introducing the company to senior officials in the Iraqi government,” Obama spokesman Ben LaBolt said. “That is not the kind of action Sen. Obama usually takes for individual companies, and our staff concluded on that basis to decline the requested assistance.”
LaBolt said Obama’s staff was unaware Companion had any ties to Rezko, who has raised campaign donations for Obama.
Companion beefed up its lobbying efforts in March, hiring a Washington attorney who has contacted the U.S. State and Commerce departments. Frawley wants U.S. officials to persuade the Iraqi government to honor the contract he signed on April 18, 2005, when Aiham Alsammarae, another friend of Rezko’s, ran Iraq’s electricity agency.
Iraq’s current electricity minister has balked, saying Frawley’s contract is too expensive, according to a U.S. Embassy official in Baghdad.
Novak reported that Obama’s Senate staff “had two meetings, one conference call, and sporadically e-mailed with representatives” for Companion.
However, a second version from August 7, 2007 reported:
- Two months later, Frawley sought help from Obama, a member of the Senate Foreign Relations Committee who is now running for president. Frawley met with Seamus Ahern, who runs Obama’s Moline office. Frawley and Ahern discussed the proposal over a period of about six months.
So, for a reported six-month period, Obama staffer Seamus Ahern was in discussions with Frawley — whose partner in the deal was Rezko — regarding the proposed security contract but nobody, apparently including Obama, was aware of the Rezko connection? Balderdash!
But what, exactly, happened that “discussions” may have ended? Well, for one, in August 2006 Alsammarae was incarcerated in Iraq due to allegations that he had stolen millions of dollars from Iraqi reconstruction funds. But, in mid-December 2006, Alsammarae made his alledged “escape” from his Iraqi “Green Zone” jail and arrived back in Chicago in January 2007, effectively ending both Alsammarae’s influence and presence in Iraq at the same time — and possibly Rezko’s as well.
Will Obama return the favor?
Tony Rezko now sits in jail having served more than two years of a self-imposed sentence, having voluntarily reported to jail following his June 2008 conviction, prior to officially receiving his sentence late last year. Is Rezko counting on his old friend, Barack Obama, to grant him clemency in the near future? Tony does deserve a reward, you know. Silence is costly.