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Former Top State Official Indicted In Rezko Case

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May 31, 2007 7:50 pm US/Central

Former Top State Official Indicted In Rezko Case

Ex-Illinois Finance Authority Chief Allegedly Aided Rezko In $10M Fraud Scheme

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CHICAGO (AP) ― The former executive director of a billion-dollar state bonding agency was indicted Thursday on charges of aiding major political contributor and entrepreneur Antoin Rezko in a $10 million fraud scheme.

Ali D. Ata, 55, was accused of producing a bogus letter designed to help Rezko borrow the $10 million from the General Electric Capital Corp. in what prosecutors described as a plan to buy two groups of pizza restaurants at inflated prices.

Ata attorney Thomas McQueen said his client would plead not guilty to the charge of aiding and abetting fraud and "we intend to vigorously defend against the allegations."

Prosecutors already had charged Rezko with defrauding GE Capital in the deal that involved the purchase of the restaurants at inflated prices and a transfer of their assets to himself and another buyer. He has pleaded not guilty.

Ata, of suburban Lemont, was named the $127,000-a-year executive director of the Illinois Finance Authority in January 2004. He left in March 2005. A longtime Rezko friend and business associate, he has contributed tens of thousands of dollars to Gov. Rod Blagojevich's campaign.

State records show the finance authority has authorization to issue $25.2 billion in bonds and has issued $19.6 billion in such bonds. The authority describes its role as fostering "economic opportunity and job growth by providing access to affordable capital for Illinois businesses and institutions."

The indictment alleges that in February 2004, at Rezko's request, Ata signed a letter on finance authority letterhead that falsely made it appear an unnamed investor had applied for financing in connection with the purchase of pizza restaurants in Chicago and Milwaukee.

Ata knew that Rezko intended to show the letter to GE Capital to persuade the lending company to give him funds to take part in the restaurants' purchase, the indictment said.

In addition to the charge of defrauding GE Capital out of the $10 million, Rezko also has pleaded not guilty to separate charges that he worked with millionaire political contributor Stuart Levine to squeeze payoffs out of money management companies seeking state business.

Both Levine and Rezko had been major contributors to Blagojevich's campaign. The governor has been accused of no wrongdoing.

Levine has pleaded guilty to federal charges and now is cooperating with the government's Operation Board Games, an ongoing investigation of corruption, influence-peddling and kickbacks on state boards and elsewhere.

Ata left the financing authority after coming under sharp criticism from the Illinois Campaign for Political Reform, a group funded by private foundations, for failing to list his financial interest in a Chicago building on his economic disclosure statement.

A Republican state representative, Steve Rauschenberger, also criticized the appointment of Ata to the economically sensitive post.

Ata said at the time that he "thought I had divested myself of this thing" and did not believe that he was required to report his interest.

(© 2007 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)

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