Buy My Book Here

Fox News Ticker

Please check out my new books, "Bullied to Death: Chris Mackney's Kafkaesque Divorce and Sandra Grazzini-Rucki and the World's Last Custody Trial"

Tuesday, December 9, 2008

The Real Estate of Luis Guttierez

Today, the state of Illinois, and the nation, is dealing with the stunning news of the indictment of Rod Blagojevich.

Lost in the shuffle will be this investigative report by the Chicago Tribune of Congressman Luis Gutierrez.

In half a dozen deals with campaign supporters since 2002, Gutierrez has made about $421,000 by investing his money in real estate deals and exiting a short time later.

The congressman says he made a profit in five of those deals but lost a small amount of money on the sixth.

Gutierrez said his real estate investments were appropriate and that he shared the same risk as any other investor."I don't believe in the stock market," Gutierrez said. "It always causes conflicts of interest."

Among the reasons his real estate dealings do not cause conflicts, Gutierrez has said, is that he never interferes in local zoning matters. But the Tribune reported in October that Gutierrez sent a letter to Mayor Richard Daley seeking support for a controversial project built by one of the congressman's political donors who also had lent him money. The newspaper reported that federal authorities investigating zoning matters have shown interest in the Gutierrez letter.

Further, Karbowski and several of the developers who did real estate deals with Gutierrez obtained key zoning changes for other projects from Ald. Manuel Flores (1st), his former aide and political ally.

Gutierrez is among a handful of candidates under consideration to fill the vacant U.S. Senate seat of President-elect Barack Obama, and if he is chosen, Flores is among those considering a step up to the congressman's seat.Both Flores and Gutierrez rent space for their government offices from Karbowski. Taxpayers pay $4,000 a month for Gutierrez to rent space for his district office in Karbowski's building.

The report details five different real estate transactions that Gutierrez did with multiple different donors. In some of these transactions, donors actually gave Gutierrez money. In other transactions, Gutierrez was built a property by these donors. These deals netted Gutierrez $420,000 in profits. Gutierrez maintains that he got the same deal anyone else would and that there was no quid pro quo. Yet, the Tribune discovered a letter that Gutierrez wrote to Richard Daley seeking support for a project backed by one of these very donors.

Furthermore, on one of the properties, 1634 N. Hermitage, Gutierrez bought a piece of land from a donor. Then, he had the very same donor build him a home worth roughly $800,000. This property was intended to become the primary residence for Gutierrez. In other words, this is where Gutierrez supposedly intended to live. Yet, when the property was completed, Gutierrez changed his mind. He wanted to sell, and the builder himself bought the property from Gutierrez for a profit, for Gutierrez, of $182,000. Now, why would a builder ever pay a premium for a property they themselves built? If anyone knows the real cost of a building it is the builder. Yet, this builder paid a premium of $182,000 for this property. Everyone involved is further claiming that this profit didn't come with any quid pro quo.

If Blagojevich is the extreme in Illinois politics, then Gutierrez is the everyday. It is difficult if not impossible to tell if Gutierrez really did do anything wrong. It certainly looks awfully suspicious. Gutierrez claimed that he doesn't like stock deals because there is an inherent conflict of interest. It appears that there is nothing but conflict of interest in these deals.

If anyone wants to know the extreme of Illinois corruption, examine the case of Rod Blagojevich. If you want to know how business is conducted daily, examine the case of Luis Gutierrez.

No comments: