Chicago Sun-Times
Inside the Rod Blagojevich investigation and related cases

Blagojevich witness: $10 billion state deal led to kickbacks for the former governor and others

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Lon Monk's critical testimony continues as he alleges that a $10 billion state deal was controlled not by experts in Rod Blagojevich's administration -- but fund-raising friends who wanted to make money off the deal.

That's because Blagojevich, Tony Rezko, Chris Kelly and Monk were to win a $500,000 kickback off the deal, he said.

Monk told of a number of secret meetings involving the four of them. He said they referred to one another as 1,2, 3 and 4.

Monk said he listened intently when Kelly explained to him how they could profit off of state deals.

"I was intrigued and I wanted to make money," he said.

While the money was paid into a secret account held by Rezko, Monk never testified whether he knew if Blagojevich ultimately got any of the money.

Monk said in 2003, early in Blagojevich's first run in the governor's office, Blagojevich gave the OK to sell all $10 billion in bonds in one day -- rather than over several days, and by several different firms.

Handling the huge task was Bear Stearns, a firm recommended by Kelly and Rezko.
Blagojevich gave the nod to the deal only after Kelly took him aside in a government meeting and told him what to do.
Kelly was the only non-staffer present at the meeting, Monk said.

Kelly later told Monk he pushed Blagojevich to approve the deal.

"It was either really going to help fund-raising or we were going to make money ... The four of us," Monk said Kelly explained.

Monk said the $10 billion deal was steered to Bear Stearns while Bob Kjellander was lobbyist.

Monk said as a reward for the business, Kjellander: "had given Tony $500,000 and that Tony was putting that in a separate account for the four of us."

Monk said he, Rezko and others didn't want anyone to know about the account: "Because it would have been illegal."
Was the money all for Rezko?
"No," Monk said. "That it would eventually be divided equally among us ... "After Rod was out of office."

Kjellander at the time was the National Republican committeeman.

Chris Kelly later blew his top at Rezko for withdrawing $100,000 from the account.
"By withdrawing the money it would make the account more visible than it otherwise would because there was activity in it," Monk said.

Kelly told Rezko to put the money back in, Monk said.
Kelly wasn't worried Rezko would take the governor's share just: "That the account would become known," Monk said.

Ultimately, Monk said he saw not a cent of the money.
"Do you know what happened to it?" Prosecutor Chris Niewoehner said.
Said Monk: "No"

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Adam has turned his questioning to a $10 billion state bond deal. Judge James Zagel tries to calm down Adam's questioning on the topic, telling him to stay on track. "My concern is there is a discrete set of charges.... Read More

5 Comments

I suspect that Tony Rezko has or had the money and it disappeared into his sink hole of ill-gotten gains. It's probably off-shore by now.

who actual received the $10,000,000.00 commission? how did they split it up? was the sec watching porno for the past 7 years? if they paid bribes for the business, this is securities fraud along with the other criminal allegations. where did all of that cash go? does lisa have a job?

blagojevich.... just saying it makes me smile.

How damaging is this?? if he never recieved a penny from it or if prosecution can't prove he did, then how does that reflect on the charge of corruption. As i understand it, you are corrupt for a reason, money, power??? `

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About this Entry

This page contains a single entry by Natasha Korecki published on June 9, 2010 4:33 PM.

Blagojevich trial: Rezko, Kelly eyed presidency, Monk said was the previous entry in this blog.

Blagojevich Judge: Secret FBI tapes will be released as they're played. Well, not exactly. is the next entry in this blog.

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