Obama Super PAC Leans on Chicago Machine

$50,000 raised by long time Obama ally with ties to Blago, Rezko

February 21, 2012

The sole major contributor to Obama’s Priorities USA PAC for the month of January is a longtime ally of the president with ties to the Illinois political machine, including convicted fraudster Tony Rezko and disgraced former Illinois governor Rod Blagojevich.

Priorities USA raised a mere $59,000 in January, according to the Federal Election Commission. Almost all of it came from Obama fundraiser John W. Rogers, who donated $50,000.

Rogers is the CEO of Ariel Investments, the largest minority-run mutual fund firm in the U.S. He raised more than $500,000 for Obama’s 2008 presidential campaign as a bundler.

Rogers and his Chicago-based firm’s ties to the president go back to Obama’s time as an Illinois State Senator.

In 2000 and 2001, Obama urged Illinois pension funds to give more business to black-owned investment firms, such as Ariel. The year after Obama’s pitch, the Illinois teacher retirement system reported an 18 percent increase in assets managed by minority-owned firms.

By 2005, Ariel was managing $578 million in state pension funds and had become a supporter of Illinois Gov. Rod Blagojevich’s re-election campaign. Ariel Investments and its executives donated $117,500 to Blagojevich, making it the second largest contributor with ties to the Illinois state pension business.

Rogers told the Chicago Sun-Times the donations reflected a close philosophical alignment with Blagojevich.

Also in 2005, then-U.S. Senator Obama took 23 private aircraft flights—before he decided to institute an office-wide ban on gifts and privately funded travel—often to attend and headline fundraisers he headlined. One plane was controlled by Rogers.

In 2006, Tony Rezko was indicted in a federal investigation and charged with attempting to extort million of dollars in kickbacks from money managements firms seeking to do business with the Illinois Teachers Retirement System.

When news of the investigation became public, the teacher pension board dropped its relationship with Ariel.

Rezko was sentenced to more than a decade in prison in 2011 after being convicted on 16 counts of corruption and fraud. Court documents from Rezko’s case show Rezko raised $22,500 for Blagojevich through Rogers.

Blagojevich was arrested in December of 2008 on federal corruption charges, including trying to sell President Obama’s vacant Senate seat.

Priorities USA did not immediately respond to requests for comment.