Glennon Pleads Guilty

With his trial poised to start this week, former Illinois-based public finance banker and financial adviser John Glennon recently entered a guilty plea to charges stemming from a kickback scheme involving a bond-financed Chicago medical school construction project. Glennon had initially pleaded not guilty to a handful of counts and was facing a trial before U.S. District Court Judge John F. Grady. He is cooperating with federal authorities in their investigation into corruption in state governments and faces a sentence of up to 14 months, though U.S. prosecutors are expected to recommend a lighter sentence. The initial charges carried a maximum sentence of 35 years. The indictment against Glennon had accused him of aiding and abetting a kickback scheme and lying to a federal agent during an interview. Glennon pleaded guilty to the misapplication of bond proceeds raised by the Chicago Medical School, now called the Rosalind Franklin University of Medicine and Science, and to attempting to conceal the scheme. The scheme was orchestrated by businessman Stuart Levine, a member of the medical school’s board, to illegally keep some of the proceeds from a bond sale issued to finance a building project by steering the additional funds to Glennon’s consulting company, North America Capital Opportunities Inc. The scheme was one of two alleged by federal authorities when Levine was indicted in 2005. The other allegation was that Levine orchestrated a shakedown involving Edward Hospital in Naperville, which was seeking state approval for a $90 million new hospital. Levine sat on the state board that reviewed hospital construction plans. Former Bear, Stearns & Co. public finance banker P. Nicholas Hurtgen and construction company owner Jacob Kiferbaum were also indicted in connection with that alleged crime. Grady earlier this year dismissed the charges against Hurtgen because federal authorities did not allege he actually knew of the planned kickbacks Levine was to receive for helping the hospital win approval for its project. Kiferbaum had previously pleaded guilty and is cooperating. Levine also has entered a guilty plea and is cooperating. Glennon was an aide to former Illinois Republican Gov. James Thompson. He became a public finance banker in the 1990s, working at Lehman Brothers and then Alex. Brown & Sons Inc. He later started a consulting business, and was tapped by former Republican Gov. George Ryan in 1999 to oversee construction of the $12 billion public works program Illinois FIRST. Glennon had also served as a financial adviser and lobbyist to DuPage County, just west of Chicago.