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Feds file criminal case against ComEd, implicate Mike Madigan
A federal subpoena to Madigan’s office shows the feds are interested in the speaker’s relationship with other companies as well. The feds also want wide-ranging records involving Madigan’s top political operatives.
By Jon Seidel, Tim Novak, and Tina Sfondeles Updated Jul 17, 2020, 9:19am CDT
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House Speaker Michael Madigan has been implicated in a criminal investigation involving ComEd. AP
Federal prosecutors implicated Illinois House Speaker Michael Madigan on Friday in a brazen, Chicago-style bribery scheme involving ComEd that allegedly went on for years and involved payments to Madigan associates exceeding $1.3 million.
Though the stunning, lengthy details were revealed in documents that charged only ComEd — and not Madigan — with bribery, they said ComEd has agreed to “fully and truthfully cooperate” with federal prosecutors. The company has agreed to pay a $200 million fine and acknowledged it sought Madigan’s help for legislation that could be worth more than $150 million to the utility company.
And a federal subpoena for records from Madigan’s office issued Friday and obtained by the Sun-Times shows that ComEd isn’t the only company with a relationship with the speaker that the feds are interested in. The feds requested records from the speaker’s office regarding AT&T Services Inc, Walgreens and Rush University Medical Center. They are also asking for records that include a wide swath of Madigan’s political operatives, including one current and two former Chicago aldermen, as well as close Madigan ally and lobbyist Michael McClain.
Walgreens declined to comment, while AT&T Services and Rush offered no immediate comment.
Madigan is not identified by name in the ComEd court documents, but referred to as “Public Official A.” But there is no doubt it is him, as the documents identify that person as Illinois’ house speaker. No one in the country has held that title as long as Madigan.
Madigan denied any wrongdoing in a statement.
U.S. Attorney John Lausch repeatedly declined to say at a news conference Friday if Madigan would be criminally charged.
Lausch described the ongoing investigation as “vibrant.”
“We realize we have a lot of work to do, and we’re going to get that done,” he said.
The speaker’s office received the subpoena Friday, which included multiple requests for records to be produced on or before July 29. The time frame is for information from Jan. 1, 2010 to Friday.
Documents requested include communications about contracts and “any other form of employment for any precinct captains for the 13th Ward or anyone who worked for a campaign “at the request of Madigan, Frank Olivo, Michael R. Zalewski or Ald. Martin Quinn including contracts or employment with private or public entities.” Olivo and Zalewski are former Chicago aldermen and Madigan allies.
It also seeks documents regarding former State Rep. Edward Acevedo, former Cook County Commissioner Edward Moody, Madigan precinct captain Raymond Nice, Olivo and Zalewski, including “efforts to give, seek, recommend, secure or obtain a benefit of any form,” including contracts, payments or employment for family members.
Also requested are documents and communications about Exelon and ComEd, and ex-Exeleon CEO Anne Pramaggiore, former ComEd CEO Frank Clark, who also was the president of the Chicago Board of Education, as well as former high-ranking utility employees John T. Hooker and Fidel Marquez. Also included in that request are former City Club president Jay Doherty, and several lobbyists who are Madigan allies and lobbyists.
The feds are interested as well in details surrounding a piece of state-owned land at Cermak and Wentworth Avenue in Chinatown. Efforts to develop that property ultimately led to criminal charges against Chinatown developer See Y. Wong for wire fraud. Wong, in turn, made a secret 2014 audio and video recording for the feds of then-Ald. Danny Solis and Madigan, according to court records and sources. That recording became part of the investigation that persuaded Solis to then secretly record Ald. Ed Burke. The Sun-Times first reported on behind-the-scenes machinations over the property.
The subpoena requests documents concerning any contemplated or proposed legislation about the parcel “from or to” Madigan, former State Rep. Martin Sandoval or any other elected officials, as well as from or to any member of the Illinois Department of Transportation or to McClain or lobbyist Nancy Kimme, a former top aide to former Illinois Comptroller Judy Baar Topinka.
Sandoval pleaded guilty to bribery and tax evasion earlier this year and is cooperating with the feds.
Documents about Kevin Quinn, who is the brother of the Ald. Marty Quinn, and Solis are also among those the feds want.
On Friday, Gov. J. B. Pritzker said if the ComEd allegations involving Madigan are true, he must resign.
“These allegations strike at the core of what public service means . . . If these allegations of wrongdoing by the speaker are true, there is no question that he will have betrayed the public trust, and he must resign,” Pritzker said at an unrelated news conference in Waukegan.
The court documents filed Friday are full of colorful, Chicago-style quotes. At one point, a Madigan associate warns, “I would say to you don’t put anything in writing . . . all it can do is hurt ya.”
At another, that person — not named in the court records but identified by the Sun-Times as McClain — says, “We had to hire these guys because (Madigan) came to us. It’s just that simple.” A consultant allegedly said payments were made “to keep (Madigan) happy, I think it’s worth it, because you’d hear otherwise.”
McClain at one point allegedly explained that, for decades, Madigan had named people to become ComEd employees such as meter readers as part of an “old-fashioned patronage system.”
Madigan’s influence was so great he even requested a specific candidate be appointed to the ComEd board of directors. While that person is not named in the court document, it is former McPier CEO Juan Ochoa, sources said.
FBI secretly recorded Mike Madigan at his law office pitching firm’s services
Feds’ wiretap shows Madigan, Solis eyed development of state land in Chinatown
Feds cast wide net on Berrios, get records on gov’s Gold Coast mansion, 118 other properties
The criminal charge against ComEd follows more than a year of intrigue regarding the feds’ public corruption investigations and whether their work would ever touch Madigan, one of the most powerful Democrats in Illinois for decades. He’s wielded as much power as, and often more than, its governors.
Madigan, 78, is known in Springfield as “The Velvet Hammer” for his quiet, but iron-fisted control over his chamber. So legendary is his political acumen and legislative prowess that fellow legislators, lobbyists and insiders toss about the maxim, “Never bet against the speaker.”
The powerful Southwest Side Democrat — and the allegations against him — harken back to the days of the late Mayor Richard J. Daley, whom Madigan considers his personal mentor.
Read the documents
An information and statement of facts filed in federal court Friday end a federal criminal investigation into a years-long bribery scheme. Read the complete legal documents here.
Madigan has held the reins in the state House for much of the past 37 years, serving as speaker for all but two years since 1983.
He was first elected to the House in 1971. His longevity eclipsed the 33-year record set by South Carolina’s Solomon Blatt, who served from 1937-1946 and 1951-1973, according to the Illinois Campaign for Political Reform.
Pritzker on Friday said he was “deeply troubled, and frankly, I’m furious with what is being reported” about Madigan.
“In the meantime, I urge the speaker to fully cooperate with the investigation and answer all questions as quickly as possible,” Pritzker said.
The governor noted his office has called for “robust action,” touting an ethics reform package he pushed late last year in Springfield. “But it’s only a beginning and I’ve been calling for much more stringent measures, for example, increased transparency around lobbyists’ disclosures, for prohibiting lawmakers from being lobbyists — that seems like a no brainer to me. And we need to stop the revolving door of legislators being able to leave office and just turn around and become a lobbyist right away, or a consultant.”
Mayor Lori Lightfoot on Friday at an unrelated news conference declined to enter the controversy over whether Madigan should resign.
“As far as I know, there’s not been any charges against him,” Lightfoot said. “But that really need not be the standard. It’s not for me as the mayor of the city to talk about whether or not the Speaker of the General Assembly should or shouldn’t take certain action.”
The explosive news comes just two days after Madigan dismissed Republican calls for him to push ethics reform legislation.
During a break from presiding over a party meeting in Springfield in his role as chairman of the Illinois Democratic Party, Madigan told reporters that Republicans should start in Washington, not Springfield.
“I would suggest that the Illinois Republicans who want to pursue ethics reform go out to Washington, follow up on President Trump’s promise to drain the swamp,” Madigan said. “They can begin with Trump, the Attorney General [William Barr], [Former National Security Advisor] Michael Flynn, Roger Stone and others.”
The state GOP wasted little time in responding to the development and worked to tie Madigan’s troubles to Gov. J.B. Pritzker.
Illinois GOP Chairman Tim Schneider said in a statement: “The people of Illinois now live in a state where both the Speaker of the House and the Governor are under criminal investigation. Even for a state with a history of corruption, this is unprecedented. Crimes of bribery and tax fraud cannot be tolerated from our elected officials.
“As we learn more about the bribery investigation into Speaker Madigan and the property tax fraud investigation into Gov. Pritzker, our hearts go out to the people of Illinois who are once again left yearning for elected leaders who work for them, not for themselves. The Democratic culture of corruption in Illinois must come to an end.”
The statement is referring to an article published online by the Sun-Times Friday that reported federal prosecutors have requested records from the Cook County assessor’s office regarding the $330,000 property tax break that Pritzker got on a Gold Coast mansion. The story does not suggest Pritzker himself is under criminal investigation.
On Friday, Pritzker said about the property tax controversy that “. . . any review will show that all the rules were followed, but I’ve not been contacted by federal authorities, nor has my wife.”
As for ComEd, the criminal bribery charge against the utility is expected to be resolved through what is known as a deferred-prosecution agreement. The agreement lasts for three years and could be used by the feds to make sure ComEd cooperates in any ongoing investigation.
In a filing with the Securities and Exchange Commission, ComEd noted that: “The amount of the payment reflects credits for ComEd’s substantial remediation and cooperation efforts as provided for under the U.S. Sentencing Guidelines. The payment will not be recovered in rates or charged to customers, and ComEd will not seek or accept reimbursement or indemnification from any source other than Exelon.”
Exelon CEO Christopher M. Crane said in a statement: “We are committed to maintaining the highest standards of integrity and ethical behavior. In the past, some of ComEd’s lobbying practices and interactions with public officials did not live up to that commitment. When we learned about the inappropriate conduct, we acted swiftly to investigate.
“We concluded from the investigation that a small number of senior ComEd employees and outside contractors orchestrated this misconduct, and they no longer work for the company. Since then, we have taken robust action to aggressively identify and address deficiencies, including enhancing our compliance governance and our lobbying policies to prevent this type of conduct. We apologize for the past conduct that didn’t live up to our own values, and we will ensure this cannot happen again.”
The regulatory filing noted that the SEC investigation involving Exelon and ComEd is continuing.
Contributing: Mitchell Armentrout, Nader Issa, David Roeder