CHICAGO - Powerful Chicago-based lobbying firm Ronan Potts LLC, whose ties to Illinois'public finance community run deep, was among six defendants named yesterday in a federalindictment on corruption charges.
The six are charged with allegedly participating in a scheme to steer an $11.5 millioncontract to a management firm hired in 2001 by the Metropolitan Pier and ExpositionAuthority to manage the $800 million bond-financed expansion of McCormick Placeconvention center in Chicago.
The indictment also names Scott Fawell, who was then the chief executive officer ofMetPier and is now serving jail time stemming from previous corruption charges that arealso part of the same sweeping six-year-old probe into state government corruption knownas Operation Safe Road.
In addition to Ronan Potts and Fawell, the indictment names Fawell's former assistantAndrea Courtretsis and two former employees of Jacobs Facilities Inc., a St. Louis-basedconsulting firm that has overseen the expansion project. Julie Starsiak, a formerofficer of Ronan Potts who represented Jacobs in its efforts to obtain the contract, wasalso named.
The indictment alleges that Fawell and Courtretsis provided Ronan Potts withconfidential, non-public information that in turn was handed over to Jacobs to give thefirm an edge in the bidding process. The firm lowered its initial bid to $11.5 millionfrom $18.8 million and won the contract.
To the surprise of some market participants, Al Ronan, a close friend of Fawell and thehead of Ronan Potts, was not named in the indictment. It does, however, note that"between 1999 and 2002, a Ronan Potts principal and close associate of Fawell,identified as `Fawell Associate 1,' offered Fawell, and Fawell accepted, such gifts asmeals, golfing, entertainment, vacations, and contributions to his legal defense fund."
At a news conference yesterday, U.S. Attorney Patrick Fitzgerald declined to say whyRonan was not indicted or whether he was cooperating with authorities. "Theinvestigation is continuing," he said.
An arraignment date has not been set. Ronan Potts attorney James Cutrone was notimmediately available for comment.
Ronan Potts has long-standing ties to Chicago's public finance community. Ronan's firmhad worked as a lobbyist on behalf of ABN Amro Financial Services Inc., which paid him$5,000 per month, according to filings with the Municipal Securities Rulemaking Board.The firm severed its relationship with Ronan Potts last year. Merrill Lynch & Co. hadhired Ronan Potts last year as a consultant at $10,000 per month in the second quarterof 2003, according to MSRB filings under Rule G-38. A Merrill spokesman said the firmhas severed its ties to Ronan Potts. The split, however, was recent because Ronan stilllists Merrill as a client in state and city records and on the lobbying firm's Web site.
Ronan Potts has had a longstanding lobbying relationship with PTW, which was knownformerly FPT & W, until John Filan sold his interest in the firm in early 2003 to takethe job as Illinois's top finance official. The two firms shared office space until lastNovember, but Ronan Potts remains a lobbyist for PTW, according to a firm official.
Ronan, a former state representative from Chicago, also previously worked as a lobbyistfor the now shuttered Rodman & Renshaw Inc. Ronan previously served as a staterepresentative from 1979 to 1992 when he lost a re-election bid.
The investigation into MetPier is continuing. Federal authorities, according topublished reports, have also subpoenaed MetPier records of its contract with the lawfirm Mayer Brown Rowe & Maw LLP to lobby for the expansion of McCormick Place. MayerBrown hired two subcontractors for the job, including Ronan Potts.
