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Obama's Former Friend

An Inside Report by Robert D. Novak

Monday, March 03, 2008

WASHINGTON, D.C. -- As Sen. Barack Obama nears the Democratic presidential nomination, a corruption trial of his former fund-raiser Antoin (Tony) Rezko on charges of influence peddling begins in Chicago today (Monday). Sen. Hillary Clinton's operatives have tried frantically, but not effectively, to interest U.S. news media outside Chicago in Obama's possible connection with his home state's latest major scandal.

Obama bought a mock Georgian mansion on Chicago's south side on June 15, 2005, the same day Rezko's wife bought a plot next door from the same seller. Obama then purchased from Rezko another parcel at above-market value. Federal prosecutors recently revealed that Nadhmi Auchi, an Iraqi billionaire who lives in London, wired $3.5 million to the financially strapped Rezko in Chicago less than a month before the Obama-Rezko purchases. James Bone, investigative reporter for the Times of London, wrote last Tuesday that "the money transfer raises the question of whether funds" from Auchi "helped" Obama buy his house.

This is what candidate Clinton had in mind after losing Iowa's caucuses when she claimed Obama had not been properly "vetted" to be president. For months prior to that, her agents had hinted darkly that Obama's past could be used by Republicans when the time came. But these were only hints, because of fear that explicit revelations would backfire against Clinton.

The closest Clinton has come to openly raising Obama's connections with Rezko was during the Congressional Black Caucus presidential debate Jan. 21. "I was fighting" against "bad" Republican ideas, she told Obama, "when you were practicing law and representing your contributor, Rezko, in his slumlord business in inner-city Chicago." In fact, Clinton messed it up. Rezko was not a client of Obama's firm and was not a slumlord. Accused of racial insensitivity, Clinton dropped the issue.

Howard Wolfson, Clinton's sharp-tongued communications director, was not giving up and was more precise than his candidate Feb. 14, when interviewed by "National Journal On Air." He contended: "There are many questions ... about his relationship with indicted political fixer Tony Rezko that he could answer, that he has not. What was the exact nature of his relationship with Mr. Rezko? ... How much money did Mr. Rezko bundle for him? ... What favors did Sen. Obama perform for Mr. Rezko?"

Clinton agents have shopped this story around the news media since her 10-state losing streak started. A "Rezko Watch" blog attacks both Rezko and Obama daily, while alleging connections between them. The blog appears to be written by a self-styled "citizen journalist" who calls himself "B Merryfield" and dispenses the straight pro-Clinton line.

Obama has conceded his simultaneous home purchase with Rezko was a "boneheaded" mistake. He is returning $150,000 raised by Rezko and his associates, and is contributing to charity $72,650 in Rezko contributions. Asked by Tim Russert on NBC's "Meet the Press" last Nov. 11 why he was "associating with such a person," Obama replied, "There was no evidence of wrongdoing," but added, "There's no doubt that it was a mistake on my part." He made clear he had cut off all contact with Rezko "since he got in trouble with the law."

But the case against Rezko prepared by the always determined U.S. Attorney Patrick Fitzgerald poses possible new pitfalls for the Democratic front-runner by introducing into the proceedings Auchi, who has been convicted on corruption charges in France and given a suspended sentence. While his friends describe Auchi and his family as victims of Saddam Hussein's tyranny, Pentagon sources call him a "bagman" who laundered money in London for the Iraqi dictator.

Chicago Sun-Times reporters Chris Fusco and Tim Novak asked last week how it was possible for Auchi to get government permission to visit Chicago in 2004 despite his French criminal conviction. Obama aides were quoted as saying Auchi never reached out to the senator, and representatives of both men say neither has any recollection of meeting the other. But the Times of London reported last week that "the two may have had a brief encounter" at the Four Seasons Hotel in Chicago. It is an indistinct part of an indistinct story Hillary Clinton's handlers wish had attracted attention before now.

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