CHICAGO - Former Bear, Stearns & Co. public finance banker P. Nicholas Hurtgen faces a March trial on federal charges that he participated in an extortion scheme involving a Chicago-area hospital as it sought Illinois regulatory approval to build a new facility.

At a status hearing yesterday in Chicago, U.S. District Court Senior Judge John F. Grady set another hearing for next month on various motions ahead of the March 9 start of the trial. Hurtgen remains the lone holdout among four individuals charged in the case, as the others have pled guilty and are cooperating with the government.

The case against Hurtgen stems from a larger probe of state government corruption known as Operation Board Games that is being pursued by U.S. attorney Patrick Fitzgerald's office in Chicago. The trial in the nearly four-year-old case is expected to last between three to four weeks.

A key witness for the prosecution is expected to be Stuart Levine, who orchestrated the alleged scheme to force Edward Hospital in Naperville to hire Kiferbaum Construction Co. to build the new hospital in exchange for the Illinois Health Facilities Planning Board's approval of a certificate of need for the project.

Levine was the main witness in the government's successful prosecution of Antoin Rezko, a prominent fundraiser and former adviser to Gov. Rod Blagojevich, on charges that he traded state investment business and regulatory approval for kickbacks and to funnel to campaign coffers.

At the time when the hospital shakedown took place in late 2003 and 2004, Levine served as the vice chairman of the planning board. Jacob Kiferbaum, owner of the construction company, was expected to provide kickbacks to Levine. Hurtgen allegedly participated in the scheme to ensure that his former firm would win the underwriting business for the $90 million project and another $23 million office building.

The federal government first brought the charges against Hurtgen in May 2005 but Grady dismissed the case in March 2007, agreeing with the defense that the prosecution had failed to specifically allege in its indictments that Hurtgen was aware that Levine was to receive kickbacks. Hurtgen was re-indicted last December on six counts of aiding and abetting mail and wire fraud and one count of extortion.

Prosecutors made more clear their contention he had full knowledge of the alleged kickbacks and provided new details obtained from Levine, who by then was cooperating. The revised indictment alleges that Hurtgen promised Edward Hospital that the planning board would approve the projects if it hired Kiferbaum and that it would deny them if officials refused.

Hurtgen resigned in 2004 from the investment bank, which was absorbed by JPMorgan last year. He is a Wisconsin native who served as a top aide to former Wisconsin Gov. Tommy Thompson before joining Bear Stearns in 1995.

Fitzgerald's probe has greatly expanded over the last several years as the federal government narrowed in on the governor, leading to his arrest last month.

The criminal complaint against the governor, who has not yet been indicted, outlined some of the past pay-to-play schemes that have surfaced in court documents and trials over the last several years.

But it was the more recent allegation that the governor had sought to profit from his appointment to fill President Obama's vacant Senate seat that captured front page headlines across the country.

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