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| Bush Pioneer P. Nicholas Hurtgen was charged with conspiring to force Edward Hospital to hire Kiferbaum's firm to build a $90 million hospital and $23 million medical office building in Plainfield, Ill. | | Submitted by fedup | 2006-07-31 10:56:57 | A former Chicago investment firm manager with close ties to ex-Wisconsin Gov. Tommy G. Thompson and Milwaukee County executive Scott Walker was indicted Monday along with two prominent Chicago businessmen on influence peddling and related charges.
P. Nicholas Hurtgen, 42, is accused of extortion and mail and wire fraud on suspicion of telling Illinois hospital officials whom to hire to build a new hospital if they wanted state approval. He made the remarks as part of a plot to win the financing deal for the project for his then-employer, Bear Stearns, according to the indictment. Hurtgen oversaw the firm's municipal bond business in the Midwest.
Hurtgen and Chicago attorney Stuart Levine, the 59-year-old former vice chairman of the Illinois Health Facilities Planning Board, were arrested at their suburban Chicago homes Monday morning and later in the day entered not guilty pleas.
Construction executive Jacob Kiferbaum, 52, was also charged in the multiple-count indictment and cooperated with prosecutors. He was to appear in court later.
The charges followed a yearlong investigation prompted by a federal whistleblower lawsuit that outlined some of the schemes alleged in the indictment. Hurtgen's actions in Milwaukee have also been scrutinized, as federal prosectors there and in Chicago said their investigations were ongoing.
Hurtgen was charged Monday with conspiring with Levine and Kiferbaum last year to force Edward Hospital to hire Kiferbaum's firm to build a $90 million hospital and $23 million medical office building in Plainfield, Ill.
Levine and Kiferbaum were charged in connection with that deal, as well as a separate plan to defraud the Rosalind Franklin University of Medicine and Science in North Chicago and its charitable trust of some $8 million.
Levine and Kiferbaum also were charged in connection with a $1.5 million kickback scheme involving the Janesville, Wis.-based Mercy Health System and a new hospital being built in Crystal Lake, Ill. Mercy officials said in a statement the firm was "bitterly disappointed" that its state approval was tainted by the alleged kickback, but that Mercy had "always acted properly."
Levine was the central figure in each of the schemes charged in the indictment. He's accused of using his post on the health planning board to swing "certificate of need" state approvals for projects in exchange for the kickbacks. Levine was appointed to the board by former Illinois Gov. George Ryan and reappointed by the current governor, Rod Blagojevich. Levine resigned the post last spring.
"It's totally stunning what people will do when they are motivated by greed and backed by clout," Patrick J. Fitzgerald, the U.S. attorney for northern Illinois, said at a news conference. He declined to elaborate on the ongoing investigation.
Referring to Levine's service on the health facilities board, Fitzgerald said the job is meant "to look out for the citizens of Illinois and their right to medical care - not to shake down bribes and extort people to steer contracts to your friends."
Hurtgen left his Bear Stearns job in July after the federal whistleblower suit. Elizabeth Ventura, a spokeswoman for Bear Stearns, said Monday that the firm insists employees follow "the company's high ethical standards. We continue to be confident in the integrity of our business."
Levine faces 28 felonies and Hurtgen faces seven - one count of extortion and six counts of mail and wire fraud. Kiferbaum faces 22 felonies.
In federal court Monday, Hurtgen spoke softly and gave only short answers to questions by U.S. Magistrate Sidney Schenkier. He was released on a $5 million recognizance bond. He is to appear in court again May 16.
His attorney, Ron Safer, said he was confident Hurtgen would be exonerated. Hurtgen faces a maximum of 80 years in prison and $1 million in fines if he's convicted on all charges.
He joined Bear Stearns in December 1995, after a lengthy career as an aide to then-Gov. Thompson. Hurtgen's last post in state government was under top Thompson aide James R. Klauser. As deputy secretary of administration, Hurtgen's oversight included state bond deals. Hurtgen also worked for a time as a legislative aide to Thompson in the early 1980s, when he served as an Assembly representative from Elroy.
In addition to his official statehouse duties with Thompson, Hurtgen played a key role in Thompson's fund-raising apparatus. The two were also personally close; Thompson was an usher at Hurtgen's wedding.
Thompson couldn't be reached for comment Monday. In an interview March 8, Thompson said he was sure Hurtgen would be cleared of "any wrongdoing whatsoever." Thompson, who was U.S. health secretary for four years under President Bush, said he'd spoken regularly with Hurtgen and that he was cooperating with prosecutors.
"From what I have been able to ascertain, there is little or nothing here," Thompson said.
County deal scrutinized
A local offshoot investigation began last summer after questions were raised about a $100 million Milwaukee County bond deal underwritten by Bear Stearns and the Journal Sentinel reported Hurtgen's political connections to Walker, now a Republican candidate for governor.
The paper reported that Hurtgen helped set up a 2003 Chicago fund-raiser for Walker during a period when Bear Stearns was seeking county bond business. Records of the bond deal were missing, but later turned up.
Levine and his wife, Sheri, gave Walker a total of $5,000 around the same time, according to county records.
Walker on Monday defended the county's actions.
"Every independent review of the work done by Bear Stearns shows that the process was legitimate and that the plan saved taxpayers money," Walker said. "The county used numerous safeguards to ensure a fair process with positive results."
However, aspects of the bidding process were criticized by an auditing firm hired last year by the County Board. Auditors concluded that the county generally has an acceptable bidding and award process in place, but for bond transactions, several improvements could "elevate the public's confidence."
Milwaukee County District Attorney E. Michael McCann found no evidence of political pressure during the selection of Bear Stearns, he said Monday.
A federal investigation into aspects of the county deal continues. U.S. Attorney Steven M. Biskupic declined to comment Monday.
Hospital officials aided probe
Monday's indictment alleges that:
Hurtgen helped set up a meeting for Levine, Kiferbaum and Edward Hospital officials on April 18, 2004, at a Deerfield, Ill., restaurant. The meeting came after several calls and meetings over several months between Hurtgen and hospital officials in which he warned that Kiferbaum's firm must be hired for the Plainfield project.
What the three defendants didn't know then, however, was that two Edward officials were cooperating with prosecutors in a kickback probe.
The Edward officials did not sign a contract with Kiferbaum, and the state board did not approve the project.
Levine also got a $1.5 million kickback from Kiferbaum in connection with the Mercy project in Crystal Lake, in which Kiferbaum was paying $72,000 a month through a phony consulting contract, according to the indictment.
Levine's and Kiferbaum's biggest take, however, was with the Rosalind Franklin University of Medicine and Science projects, in which Levine got $2 million in construction kickbacks from Kiferbaum and $6 million through an elaborate scheme involving the Northshore Supporting Organization trust that supports scholarships at the school.
In addition to his position on the state hospital planning board, Levine also served on the boards of the medical school and the trust. Levine got the trust to lend $6 million to Levine's investment firm, S.L. Investment Enterprises, and a second firm and then "arranged to have both loans forgiven without repayment," prosecutors said.
Levine has been a prominent Chicago powerbroker and major political donor to both Republicans and Democrats.
Graeme Zielinski, in Chicago, and Dave Umhoefer, both of the Journal Sentinel staff, contributed to this report
From the May 10, 2005 editions of the Milwaukee Journal Sentinel
www.jsonline.com/news/metro/may05/324847.asp
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| Vote to keep | | Submitted by RedVest | 2007-01-07 15:26:16 | In some ways this could be considered the epitome of poltical corruption. It seems to be the kind of strong arm tactics used by the likes of Gangsters of yesteryear to manipulate contracts and get business for themselves and their friends.
Keep a light on ema nd let them scurry like cokcroaches...
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