May 17, 2007 6:44 pm US/Central
Vrdolyak Pleads Not Guilty To Bribery, Fraud
Feds: Legendary Alderman Conspired For Kickback From Real Estate Sale
CBS 2's Kristyn Hartman and Mike Parker contributed to this report.
CHICAGO (CBS) ―
Legendary former Chicago Ald. Edward Vrdolyak pleaded not guilty Thursday morning to bribery and fraud charges.
Vrdolyak, the 69-year-old attorney famously known as "Fast Eddie," was charged last week with mail fraud, wire fraud and bribery.
Vrdolyak is accused of scheming with businessman and Republican political insider Stuart Levine to get a kickback for Levine from the 2004 sale of the old Dr. William F. Scholl School of Podiatric Medicine at 1001 N. Dearborn St. for a condo project.
The usually talkative Vrdolyak was quiet as he came to the Dirksen Federal Building. He said very little to the media, but when CBS 2's Mike Parker asked Vrdolyak if it was a good morning, the former alderman replied, "Every day is a good day."
Vrdolyak had good reason to keep his mouth shut; this was serious business. The one time powerhouse of politics was arraigned on federal fraud and bribery charges before U.S. District Judge Milton Shadur.
Vrdolyak's attorney, Michael Monico, said that "Mr. Vrdolyak is not guilty of the charges in the case. He has so pled today."
Federal prosecutors said Vrdolyak schemed with wealthy political insider Stuart Levine to split a $1.5 kickback they tried to arrange through the sale of the Dearborn Street property on Chicago's Gold Coast.
At the time of the alleged scheme, Levine was a member of the board of trustees for the Rosalind Franklin University of Medicine and Science in North Chicago, then known as the Finch University of Health Sciences/Chicago Medical School. Levine was not named as a defendant in the indictment.
The indictment alleges that from 2002 to 2006, Vrdolyak agreed to solicit Smithfield Properties to buy the Scholl College building and Levine agreed to use his position on the board to steer the sale to Smithfield.
In March 2003, Levine convinced the school to negotiate an agreement to sell the property to Smithfield for $9.5 million. But two months later, competing proposals were submitted to purchase the site for at least $15 million and Vrdolyak later convinced Smithfield to increase its bid to $15 million. The sale to Smithfield was closed in November 2004, the indictment alleged.
Vrdolyak arranged a fee of 10 percent of the purchase price from Smithfield -- or $1.5 million -- to be paid upon completion of the condo project, the indictment alleged. Prosecutors said he agreed to split the money with Levine, and they planned to conceal the kickback with a sham loan.
Because the feds caught on to the scheme before the condo project was completed, Vrdolyak never received the payment from Smithfield.
The full force of his legal predicament hit Vrdolyak squarely in the face as he was ordered to put up his Michigan horse farm to secure his release on a $500,000 bond. He was also ordered to remain in the country and to surrender his passport.
Before his release, the former alderman and mayoral candidate was processed in the U.S. Marshal's lockup.
"Nobody appreciates the pressure that a family is under when they are charged, except if you go through it, and it is tremendous pressure. He is handling it as well as anybody could possibly handle it," Monico said. "His family is very strongly supporting him. He's had literally hundreds of calls from friends over the years; from friends who have offered their aid and support."
It was also confirmed in court that the prosecution's evidence against Vrdolyak includes audio tapes of conversations between Levine and Vrdolyak.
Monico said he has not been given those tapes yet, has not heard them, and will not talk about them. He also said that when the trial starts, with Stuart Levine as the star prosecution witness, defense lawyers will show that Levine, not Vrdolyak, was motivated by "greed and lust for money."
Vrdolyak was on the front lines of Chicago politics in the 1970s and 80s and is now a private attorney some say has been the power behind the scenes in Cicero town government.
He served as the alderman of Chicago's 10th Ward from 1971 to 1987 and led the so-called "Vrdolyak 29," a group, consisting of mostly white aldermen, who regularly opposed Harold Washington, Chicago's first African American mayor, during the infamous "Council Wars" of the 1980s.
Vrdolyak was also the Cook County Democratic Party chair from 1982 to 1988 and ran unsuccessfully against Washington as an independent candidate in 1987, then lost again in 1989, when he ran as a Republican against Richard M. Daley, who has been mayor ever since.
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