A federal grand jury last week indicted Illinois political insider William Cellini on charges that he attempted to extort campaign contributions for Gov. Rod Blagojevich from a firm interested in winning state pension fund investment business.

Cellini is a Springfield-based businessman who is a Republican but has close relationships to both Democrats and Republicans. The indictment on charges of conspiracy to commit mail fraud, extortion conspiracy, attempted extortion, and soliciting a bribe is the latest in the federal government’s probe of state government corruption known as Operation Board Games.

Cellini previously had been identified as a co-conspirator during the recent trial of Antoin Rezko, a top fundraiser and former adviser to Blagojevich. His voice was heard on tapes played at trial in which the alleged extortion scheme was discussed.

Cellini is alleged to have worked with convicted businessman Stuart Levine to seize control of the state teachers’ pension fund on which Levine sat. Cellini, along with Levine and Rezko, allegedly sought to reward firms with investment business that had given contributions to the governor and withhold business from firms that refused.

Cellini’s attorney Dan Webb, a former U.S. attorney in Chicago, said in a statement that Cellini was innocent of the charges and noted that Rezko was actually acquitted of the charges stemming from the alleged extortion scheme Cellini is charged with. Rezko was convicted of other pay-to-play allegations involving the trading of investment business for contributions and to enrich himself.

The governor has not been charged with any wrongdoing and is referred to in federal documents only as Public Official A. The former head of the Illinois Finance Authority, Ali Ata, has pleaded guilty to charges stemming from Operation Board Games and former Bear, Stearns & Co. banker P. Nicholas Hurtgen faces a trial next year on charges he participated in a hospital shakedown scheme with Levine.

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