J.A.I.L. News Journal
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Los Angeles, California                                          March 11, 2006
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March 10, 2006
http://chicagobusiness.com/cgi-bin/news.pl?id=19805&rel=1

Ryan knew of wrongdoing, prosecutor says

(AP) - George Ryan was like an ostrich who tried to stick his head in the sand rather than learn about employees in his office doing political work on state time, prosecutors said Friday as they entered the last hours of their closing arguments.

But Assistant U.S. Attorney Patrick Collins said the former governor and two-term secretary of state couldn't help but know there was wrongdoing going on because much of it was orchestrated less than 10 feet from his office by his right-hand man, Scott Fawell.

Collins cited an instance when a secretary of state employee personally complained to Ryan about co-workers who were doing political work while being paid by the state. Ryan told Fawell to work the problem out, Collins said, citing Fawell's testimony.

"Anybody with character and integrity would have fired Scott Fawell on the spot. ... Scott Fawell only did what his master let him do," Collins said.

Collins was expected to finish his rebuttal arguments Friday afternoon. U.S. District Judge Rebecca Pallmeyer will then deliver instructions to the jury.

The only thing then left after five months of trial will be for the jury to decide Ryan's fate.

Ryan, 72, and co-defendant Larry Warner, 67, are charged in a 22-count federal indictment with racketeering, mail fraud and other offenses. It says that as part of the racketeering plot Ryan disbanded the inspector general's office as secretary of state to hide political fundraising corruption.

Ryan served as secretary of state for eight years in the 1990s. He was elected governor in 1999 and served one scandal-plagued term.

Ryan and Warner have denied anything they did was illegal.

On Thursday, Collins recalled the case of currency exchange millionaire Harry Klein, who had the Ryans as guests at his Jamaican estate every winter for a decade. One witness had described for jurors how they had sat around drinking Jamaican Red Stripe beer.

Klein got a lucrative deal from Ryan under which he leased a building to the state. But Collins said the good times came to an abrupt stop when Klein was subpoenaed by a grand jury.

"The party was over, no more Red Stripes around the table," Collins said.

Earlier Thursday, Warner's attorney, Edward M. Genson, told jurors in his closing argument that his client was merely a small-time insurance adjustor who found himself unfairly sucked into a corruption scandal by a crooked lobbyist who lied about him to prosecutors.

"What did Larry do wrong? Tell me!" Genson said.

Prosecutors say Warner showered Ryan with gifts ranging from loans to his brother's floundering business to money for the band at his daughter's wedding reception.

In return, they say, Ryan fixed leases and contracts, including a $25 million IBM computer deal to help Warner get rich.

Genson spun a tale of intrigue whose villain was Donald Udstuen, a former medical lobbyist and political strategist who secretly went into the lobbying business with Warner after Ryan's 1990 election as secretary of state.

After Udstuen got caught hiding his secret lobbying fees from the Internal Revenue Service, he tried to get a lighter prison sentence by helping federal prosecutors in their investigation.

Among other things, Udstuen told prosecutors that when the two of them went into the lobbying business and agreed to divide the fees, Warner told him: "I'll take care of George."

"Let's examine this," Genson said. "This Udstuen is a thief and a liar. How can you base any finding at all on this man saying ... years ago Larry said, 'I'm gonna take care of George?"'

"The first time he tells anybody anything about this is when he's trying to cut a deal," Genson said. He said Udstuen accused Warner at a so-called proffer session with prosecutors - something he described as "a sort of American Idol for stool pigeons."


 
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