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The Fawell Affair

He was George Ryan’s chief aide——a gifted, arrogant operator who spent his life in politics. And, prosecutors say, Scott Fawell stood at the center of a vast network of corruption. His story mixes tragedy, farce, and soap opera (a scorned husband helped bring him down)——and adds up to a dismaying case study of the political culture of Illinois

(page 5 of 6)

Ryan’s Democratic challenger in 1994 was the state treasurer, Pat Quinn, who is now the lieutenant governor. During the campaign, Quinn regularly railed at the excesses of perks and deals in the office under Ryan, often citing specific examples—such as a $25,000 contract to a former state Republican chairman who in return delivered a ten-page report on customer service at driver’s license facilities. Still, Ryan won the election with 61 percent of the vote.

Ryan’s second term as secretary of state began with the fallout over the horrific tragedy of the Willis family—six children riding in a van in Wisconsin were killed in a fiery explosion when the taillight assembly of the truck ahead of them fell off and was hit by the van. It turned out that the truck driver had illegally obtained his driver’s license. The inspector general of the secretary of state’s office, Dean Bauer, a childhood friend of Ryan’s, supposedly undertook an investigation. But when things got hot—when investigators got too close to what would become known as the licenses-for-bribes scandal—Fawell fired two of them and reassigned at least five others. Fawell wrote a memo to Ryan about the inspector general’s office that said they needed to get “someone in there who won’t screw our friends, won’t ask about [fundraising] tickets.” And then he stored that memo on a Zip disk that would come back to haunt him. (Bauer later pleaded guilty to obstruction of justice for his role in thwarting the internal probe.)

Fawell’s other schemes were more artful. With the 1996 Presidential campaign approaching, Ryan became the Illinois chairman of Texas senator Phil Gramm’s run for the Republican Presidential nomination, even though Governor Jim Edgar and much of the party establishment supported Bob Dole. “Politically for George it is just a better move,” said Fawell at the time. “He gets to play a more visible role with Gramm. If Edgar is Dole’s chairman, it’s Edgar’s show.”

True to form, Fawell diverted state employees to work for Gramm. (Prosecutors say Gramm knew nothing of the scheme.) And then Fawell found a way to make a buck. He created SRF Consulting, and arranged for the Gramm campaign to pay $30,000 to Alan Drazek, a former Chicago Transit Authority board member who ran a consulting company called American Management Resources. According to Drazek’s testimony, he signed a contract with the Gramm campaign and did some work, but diverted 75 percent of his fee to Fawell, Richard Juliano, and four of Ryan’s daughters. Juliano testified that Ryan told him to create a line item in the Gramm budget for consulting services “so that some people can make some money.” 

And then there were the marijuana and the prostitutes. According to prosecutors, Fawell accepted free marijuana from Roger Stanley, a direct mail and campaign brochure specialist, as well as vacations in Costa Rica, Door County, and Lake Ontario. The Costa Rican fishing trips were in return for state contracts awarded to Stanley. On two 1999 trips, a Costa Rican travel agent known as Penthouse Bill allegedly held welcoming parties at which Stanley and his guests would choose prostitutes to spend the trip with. Prostitution is legal in Costa Rica, but prosecutors argued in pretrial filings that the arrangement showed how close Stanley and Fawell were. “By agreeing to accept the prostitution benefits, Fawell effectively cast his lot with Stanley,” prosecutors said, “even at the risk of future blackmail.”

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When Edgar decided not to run again for governor in 1998, Ryan saw his chance. Fawell once again ramped up his operation, prosecutors alleged, using employees, office equipment, vehicles, and phones from the secretary of state’s office in Ryan’s campaign. He even cut the property tags off a state refrigerator and gave it to the campaign. Fawell reminded state employees to make their offices look “lived in” while they were away working on the campaign. Andrea Prokos suggested that the employees rotate visits to the office to establish evidence that they were on the job. According to court testimony, Prokos also directed the diversion of state office equipment to Ryan’s campaign headquarters. One day, prosecutors say, workers scooped up reams of paper from the secretary of state’s office at the James R. Thompson Center and walked it across LaSalle Street to Ryan’s campaign headquarters. “Carrying paper across the street is a silly sort of thing to do unless you’ve totally bought into the idea that there’s absolutely no distinction between political power and the public business,” says Kent Redfield of the Institute for Legislative Studies. “Certainly they pushed that line way beyond what other people had done.”

The smart campaign that Fawell had crafted for Ryan—running to the left of Democratic nominee Glenn Poshard on social issues—was almost upended by the licenses-for-bribes scandal. It broke into public view when federal investigators made their first arrests two months before the election, although Scott Lassar, then the U.S. attorney, announced that Ryan was not a target of the investigation. According to court testimony, Andrea Prokos bought an industrial-size shredder—on the taxpayers’ dime—and on at least three occasions directed the destruction of incriminating documents. “We have to shred everything, and it needs to be tonight,” Andrea said at one point, according to the testimony of Robert Newbold, the head of the physical services department in the secretary of state’s office and the downstate coordinator of Ryan’s campaign.

Ryan won the governorship, and afterward Ryan and his wife, Lura Lynn, celebrated by taking Scott and Joan Fawell to Jamaica. Reportedly it was not the first time the couples had vacationed there together. They had gone, prosecutors would later allege, as guests of Harry Klein, a close friend and campaign contributor who won lucrative contracts to lease several buildings he owned to the state. (Klein was never charged.)

Fawell was expected to follow Ryan to the Governor’s Mansion as his chief of staff, but was instead dispatched to McPier. Insiders speculated that Fawell was too hot to keep around, given the intensifying federal investigation. But being the chief executive officer of McPier was not a bad consolation prize—the job is one of the plums of the Illinois political world. McPier has traditionally been a patronage heaven with lots of opportunities to reward friends with jobs and contracts. McPier is also the embodiment of what the Tribune’s John Kass has long called the combine, the interlocking circle of clout that runs the state regardless of party membership. Appointments to McPier’s board of directors are shared by the governor, typically a Republican, and the mayor of Chicago, a Democrat. And that suited Fawell perfectly. “He was bipartisan,” says one inside operative. “It was always about business, not politics.”

Well, not entirely business. Fawell took Prokos with him to McPier, making her the director of operations. In a second indictment in 2004, prosecutors alleged that the couple used the McPier-owned Hyatt Regency McCormick Place for trysts—at the public’s expense.

Fawell quickly got to work. When he came aboard in 1999, McCormick Place South, a $675-million addition that Mayor Daley said would fulfill convention needs for 80 years, was just two years old. Fawell immediately began talking about an expansion. That July, Ryan signed a $270-million McPier bond package that included a 250-slip marina on the north side of Navy Pier, a truck storage facility at Lake Shore Drive and 31st Street, and an $8-million one-block extension of a planned express bus lane to connect with Lakeside Center east of Lake Shore Drive.

In 2001, Fawell lobbied the General Assembly for an $800-million McCormick Place expansion—a honey pot from which to dole out contracts, jobs, and favors. And when the plan ran into a roadblock because of a dispute between the House and the Senate over a portion of the funding, Fawell had the right sponsor to see it through: the governor. At the last minute, Ryan stepped into the fray and pulled the deal out of the fire. “George really took an active role, and I was with him when he was calling the Speaker and Pate [Philip, the Senate president], saying, ‘I want to get this done,’” Fawell told the Sun-Times. “He finally made this thing happen.”

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