Chicago - Aug. 22, 2014
Music TV Politics Sports Books People Places & Things
 
Beachwood Politics
Our monthly archive.
Who We Are
Chicago by the numbers.
Sausage Links
The Race Is On!
Wiki Daley
Wiki Rahm
Shakman Monitor
Daily Howler
Capitol Fax Blog
Illinois Channel
Ralph Martire
Government Attic
Division Street
Indie Political Report
Public Markup
The Obameter
ProPublica
BGA
Glenn Greenwald
SCOTUS Blog
The Progressive Fox
American Dream Betrayed

Obama's Auchi Problem

Who is Nadhmi Auchi and why is he important to Barack Obama? Let's take a look.

*

Contrary to Obama's persistent claims, he indeed did favors for Tony Rezko, including this one:

"While Mr. Obama was running for the Senate, Mr. Rezko was also raising money for a huge development in the South Loop of Chicago, often playing host to dinners in a private room at the Four Seasons Hotel here.

"Former Rezko associates said that Governor Blagojevich attended one of the dinners, and that at Mr. Rezko's request, Mr. Obama dropped in at one for Middle Eastern bankers in early 2004, just as he was starting to pull ahead in the Senate primary. The visits, Mr. Rezko's partners said, helped impress foreign guests.

"'I remember that he had been on the campaign trail, and he was completely wiped out and exhausted,' said Anthony Licata, a lawyer who represented Mr. Rezko on real estate deals. 'My recollection is that he drank ice tea, and he talked about how he was really making progress, and we were all excited to see him.'"

Last March, I asked: Was Nadhmi Auchi there?

Stuart Levine's testimony on Monday didn't answer that question, but no matter. Levine testified that both Barack and Michelle Obama attended a reception Rezko held at his Wilmette home for Auchi. "News reports from the courtroom said Mr. Rezko wanted to impress Mr. Auchi, who ultimately poured nearly $170 million into the real estate venture," the New York Times reports.

"Mr. Rezko's lawyers have raised questions about Mr. Levine's credibility on other issues, and Mr. Levine offered few details on Monday about the party at Mr. Rezko's house. Mr. Levine said Mr. Obama's wife, Michelle, was there. Mr. Obama's campaign said she had no recollection of the event. Mr. Auchi's lawyer, Alasdair Pepper, has said that his client does not remember meeting Mr. Obama."

The Sun-Times, however, reports that "according to two sources familiar with the gathering, the Obamas attended the Wilmette reception, which came less than a month after Obama's Democratic primary win for his U.S. Senate seat."

Let's be clear then: The Obamas attended the Rezko party, and it's not like Auchi was just another guest. He was the guest of honor. The party was for him, as part of Rezko's effort to get him to invest in a real estate venture in the South Loop. Surely Obama would know the purpose of a party and why the guest of honor was the guest of honor (even as he somehow didn't know that Rezko had slum properties in his state senate district at the same time).

So that is established. Now, why does it matter?

*

First, who is Nadhmi Auchi?

A lot of folks have been asking that question.

Short story: He's a controversial Iraqi-born, British billionaire who, according to one report, "set up a variety of deals with Saddam Hussein's regime prior to the 1991 Gulf War, and was one of the largest private shareholders in BNP Paribas, the bank that trafficked most of the funds involved in the UN Oil-For-Food scandal. He also admitted taking kickbacks from the French petroleum company TotalFinaElf in the 1990s (Auchi later sued Elf for entangling him in their criminal activities, according to Forbes)."

Auchi is apparently still appealing a 2003 fraud conviction in France. He visited Chicago and Detroit in 2004, but wasn't allowed back in the country in 2005.

"Prosecutors in Mr. Rezko's case have said that Mr. Rezko asked Illinois officials to help obtain a visa for Mr. Auchi's visit to Chicago," the Times says. "The officials have not been identified, and Mr. Obama's campaign has said he was not involved in that effort."

Let me ask you a question: You're Tony Rezko and you've bankrolled Barack Obama's entire political career. You helped him buy his house and you and your wife socialize with him and his wife. You've held a reception for a potential investor in which you invited Obama, who had just been elected to the United States Senate, to impress your business partner. And you appeal to Illinois officials to help him get a visa. Are you telling me you do not ask for Obama's help?

*

Obama's campaign says the senator "does not recall" meeting Auchi. There's a lot he didn't "recall" about Rezko either for quite awhile. You know, like actually knowing him.

*

Via RezkoWatch:

"Rick Moran of Pajamas Media reminds us that, during his March 14, 2008, exclusive interview with the editorial board and reporters of the Chicago Sun-Times, 'Obama denies helping Auchi in any way with his visa [in 2005] but can't vouch for his staff:'

Q: Did you ever help Auchi enter the country?

A: No.

Q: Or your office?

A: Not that I know of.

*

Here's the way the Trib put it:

"Just weeks after winning the Democratic U.S. Senate primary in 2004, Barack Obama was the guest of developer Antoin 'Tony' Rezko at a party for a controversial British billionaire whom Rezko was trying to lure into an investment, a witness testified Monday at Rezko's corruption trial.

"Stuart Levine, the government's star witness, said Obama and his wife, Michelle, were among the guests at Rezko's home on April 3, 2004, for the party honoring Nadhmi Auchi, an Iraqi-born tycoon currently appealing a fraud conviction in France.

"As he campaigns for president, Obama has acknowledged social and political ties to Rezko, as well as a real estate deal between the two that involved Obama's South Side home. But Obama has not disclosed his presence at the Auchi party, which Rezko threw as part of a campaign to persuade Auchi to pour money into a financially troubled 62-acre development in the South Loop."

And:

"Auchi came to the rescue as Rezko's business ventures began to crumble and his legal troubles mounted in recent years. Auchi, who heads General Mediterranean Holding SA, bought about 15 Wisconsin pizzerias from Rezko, court records show. He also took a stake in Rezko's South Loop development at Roosevelt Road and Clark Street.

"But help from Auchi ultimately landed Rezko in jail. Rezko had remained free on bond after his indictment in 2006 by convincing U.S. District Judge Amy St. Eve that he was nearly broke and had no access to overseas funds.

"Then $3.5 million from an Auchi-related company was wired from Beirut to Rezko's lawyers, who argued it was a loan to pay legal fees and family expenses. St. Eve didn't buy it and in January revoked Rezko's bond."

*

And now it gets interesting. Via MyDD:

"The [London] Times has, however, discovered state documents in Illinois recording that Fintrade Services, a Panamanian company, lent money to Mr. Obama's fundraiser in May 2005. Fintrade's directors include Ibtisam Auchi, the name of Mr Auchi's wife. Mr Auchi's spokespeople declined to respond to a question about whether he was linked to this business."

*

"In what appears to be a clumsy 'cleanup' operation, evidence of Auchi's visit to Illinois has now been deleted from two websites linked to his company, General Mediterranean Holding," Raw Story reports.

"After rumors began circulating that Auchi may have met with Obama, information was deleted from two websites connected to Auchi's company about a spring 2004 visit to the United States that occurred as Obama was campaigning to be Illinois' junior senator.

"On Tuesday, ABC News first reported the existence of photos showing Auchi meeting with Gov. Blagojevich on the website Middle East Online. The link on the website that the report pointed to, which said that 'businessmen, and congressmen' also met with Auchi, is now gone.

"Auchi had extensive commercial ties with Rezko, including the $130 million purchase of a property development near downtown Chicago from the indicted businessman. In 2004, according to Crain's Chicago Business, Rezko brought Auchi to Illinois for the aforementioned meeting with Blagojevich and other government officials in Illinois. Blagojevich promised at the time that he was 'ready to provide the necessary means for [GMH's investments] to succeed.'"

From Crain's, Sept 29, 2005:

"Chicago businessman Antoin S. 'Tony' Rezko, a controversial figure in local political circles, has agreed to sell his massive real estate development in the South Loop to an Iraqi-born British billionaire with a similar knack for generating controversy on the international stage.

"General Mediterranean Holding SA, a Luxembourg-based conglomerate headed by Nadhmi Auchi, is buying Riverside Park, a yet-to-be-built development on a prime 62-acre parcel on Roosevelt Road, says Michael Rumman, a consultant on the project. He declined to disclose a price; another person familiar with the deal pegged it at $130.5 million.

[Who is Michael Rumman? "Michael Rumman, former director of the Illinois Department of Central Management Services, the state's internal operations real estate agency. Mr. Rumman, the former president of Peoples Energy Services, has been hired as a consultant. He announced his resignation in April after a draft audit of CMS found problems at the agency."]

"A partnership headed by Mr. Rezko, chairman of development firm Rezmar Corp., had planned to build 4,600 residential units and about 670,000-square-feet of retail space on the site. But a city minority contracting scandal involving Mr. Rezko imperiled the project's chances of getting as much as $140 million in tax subsidies to help cover infrastructure costs."

And:

"Mr. Rezko, a close confidante and fundraiser for Gov. Rod Blagojevich, arranged for Mr. Auchi to meet the Governor and State Senate President Emil Jones on a visit to the U.S. last year.

"The odds that Mr. Rezko's partnership would be able to pull off the project fell this year, when city officials determined that he set up a minority front to obtain a concession for two Panda Express restaurants at O'Hare International Airport. The Daley Administration would have had difficulty explaining $140 million in tax increment financing (TIF) - the most ever requested by a developer in Chicago - to someone who skirted city rules, especially with corruption allegations sweeping through City Hall."

*

Wow! The only one untouched is Todd Stroger!

*

Let's see if I can summarize, because I know this is confusing. Tony Rezko pimped out Barack Obama to impress Nadhmi Auchi, a bad operator who found the political culture in Chicago and Illinois amenable to his kind of investment acumen. The only problem was that Rezko's deal was in trouble, and Rezko himself was caught up in, among other scandals, a minority-contracting scam with the Dalely administration. At the same time, Rezko was wheeling and dealing with the Blagojevich administration and everyone in the political universe knew he was under federal investigation for it but Obama asked for his help buying a $1.6 million mansion and appeared at a couple of events to help Rezko impress Auchi and others.

Now Obama's memory is faulty because there's that pesky question of judgement, as well as the stain on his meticulously burnished image as a beacon of hope and reform because his relationship with both Rezko and the Machine and politics-as-usual is deeper than he's ever cared to admit. Have I missed anything? Does that make sense now? Do you get the feeling there's still more to the story that we don't know about?

Another editorial board meeting!

*

Further resources on Auchi.

-

See more of the worlds' best Obama analysis in Obamathon.



Permalink

Posted on April 15, 2008


MUSIC - The Week In Chicago Rock.
TV - Mary Mitchell vs. Black Jesus.
POLITICS - The Sundance Mayor And His Butch Cassidy Alderman.
SPORTS - Fantasy Fix Draft Guide Pt. 3: WRs & TEs.

BOOKS - Abunimah Speaks!

PEOPLE PLACES & THINGS - Beachwood Photo Booth: Fill In The Blank.


Search The Beachwood Reporter

Subscribe To Our Newsletter
Email:

Follow BeachwoodReport on Twitter


Beachwood Radio!