Barack Obama and campaign contributor Alexi Giannoulias

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Barack Obama, U.S. Senator (D-Ill.)
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Alexi Giannoulias—a "man who has long been dogged by charges that the bank his family owns helped finance a Chicago crime figure" and "who became Illinois state treasurer" in 2006 after Sen. Barack Obama (D-Ill.) "vouched for him"—"pledged to raise $100,000 for the senator's Oval Office bid," Charles Hurt reported September 5, 2007, in the New York Post.[1]

The September 5, 2007, Chicago fundraiser was omitted from Obama's public schedule and the event was closed to the press," Lynn Sweet of the Chicago Sun-Times reported.[2]

"Before he promised to raise funds for Obama, Giannoulias bankrolled Michael 'Jaws' Giorango, a Chicagoan twice convicted of bookmaking and promoting prostitution.

"Giannoulias is so tainted by reputed mob links that several top Illinois Dems, including the state's speaker of the House and party chairman, refused to endorse him even after he won the Democratic nomination with Obama's help.

"Giannoulias was the bank's vice president and chief loan officer for most of the more than $15 million in loans," Hurt wrote.[1] although "he was not charged with breaking any laws. The Obama campaign disputed any suggestion that Obama is tarnished by the association."

Obama and Giannoulias reportedly met on the basketball court "in the late 1990s ... at the East Bank Club, a luxurious spot in downtown Chicago," Jodi Kantor wrote June 1, 2007, in the New York Times.[3] Now, "thanks in part to [Obama's] backing, [Giannoulias] is now the Illinois state treasurer. Other regular gymmates include the president of the Cook County Board of Commissioners, the director of the Illinois Department of Public Health and several investment bankers who were early and energetic fund-raisers," Kantor wrote.

Additionally, it would appear that any concerns about the crime-related bank loans expressed by Obama in April 2006 had long blown over prior to the September 5, 2007, fundraiser.[4]

Obama the king maker

"Did U.S. Senator Barack Obama clear the field in the Democratic state treasurer's race?" lawyer and political analyst Russ Stewart wrote January 4, 2006.[5]

"Until incumbent Republican Judy Baar Topinka announced for governor, the only Democrat willing to run for the post was obscure Knox County State's Attorney Paul Mangieri, of Galesburg. He was slated by the Democrats, and he is on record as opposing abortion rights. ... When Topinka decided to move up, a flock of ambitious Democrats eyed the job,... But none announced, and all deferred to Alexi Giannoulias, a 29-year-old Chicago investment banker who was an early supporter of Obama in his 2004 Senate race, whose father owns Broadway Bank, and whose family helped bankroll the Obama campaign. Giannoulias has said that he will campaign as a 'progressive,' and he has promised to put more than $1 million in family funds into the race," Stewart wrote.[5]

"The bottom line," Stewart said: "Obama is the potential king maker. Expect Obama to publicly endorse Giannoulias, cut television ads for him, and go heavy for him on black radio stations. Of course, there's a downside. If Obama endorses Giannoulias and he loses, that would indicate that Obama's clout is not transferable," Stewart wrote.[5]

In March 2006, Giannoulias said that "his 'good friend and mentor, Barack Obama,' inspired him to run."[6]

In fact, Giannoulias' "endorsers" were "essentially the base of the Obama coalition: white north side progressives and south side blacks."[7]

"My prediction: The stars are aligning for Giannoulias, another silver spooner. Every politician in the Chicago area, Daleyites and anti-Daleyites, eager to collect campaign funds from Greek Americans in the future, will back Giannoulias. Obama's early endorsement will be critical. Giannoulias will blanket the Chicago airwaves with ads proclaiming himself to be a reformer and a nonpolitician, and mail pieces will target liberal and feminist voters, ripping Mangieri's anti-abortion stance. Mangieri won't get more than 40 percent of the vote in the primary," Stewart wrote.[5]

National Foreign Trade Council v. Giannoulias

"In February 2007, the Illinois Sudan Act was held to be unconstitutional by the US District Court for the Northern District of Illinois in National Foreign Trade Council v. Giannoulias. The Illinois legislation directed the state treasurer to divest any investments in companies doing business in or with Sudan. An even more far-reaching provision prohibited the deposit of state funds in any financial institution that loaned money to companies doing business with Sudan. Relying on a US Supreme Court case decided in 2000 (Crosby v. National Foreign Trade Council), the court concluded that the Act violated the Supremacy Clause and the Foreign Commerce Clause, and additionally intruded upon the US federal government's sole authority to conduct foreign affairs. The opinion left open, however, the question of the constitutionality of a divestment provision limited to the state's own pension funds," the international law firm Latham & Watkins wrote in a client alert.[8]

"In response to the Giannoulias decision (discussed above), Senator Barack Obama (D, Illinois) introduced S. 1430, the Iran Sanctions Enabling Act. The bill is intended to support state efforts to divest pension funds from companies doing business with Iran. It would require the Treasury Department to compile a list of companies that have invested more than $20,000,000 in Iran's energy sector. States would be granted the prerogative of divesting state assets from any company appearing on the Treasury list. The Act is currently under consideration in the Senate Banking Committee. Based on the analysis in Giannoulias, US federal legislation may not be needed for states to choose how to invest their own pension funds as long as they remain within the parameters of the market participant doctrine. Nevertheless, the bill reflects at least some degree of Congressional support for state involvement in sanctioning Iran," the Latham & Watkins alert stated.[8]



  1. 1.0 1.1 Charles Hurt, "Obama's 'Mob-Tie' $idekick," New York Post, September 5, 2007.
  2. Lynn Sweet, "Today in Obamaville. Ill. State Giannoulias hosts Obama funder in Chicago. NYPost goes after Giannoulias," Chicago Sun-Times, September 5, 2007.
  3. "One Place Where Obama Goes Elbow to Elbow," New York Times, June 1, 2007.
  4. Rich Miller, "Under the bus," The Capitol Fax Blog, April 13, 2006.
  5. 5.0 5.1 5.2 5.3 Russ Stewart, "2006 Candidate Field Features Many Oddities,", January 4, 2006.
  6. Andrew Davis, "Stonewall Dems Endorse Candidates," Windy City Times, March 8, 2006.
  7. Dan Johnson-Weinberger, "Mangieri versus Giannoulias primary a fascinating look at the Democratic Party," DJWinfo, February 4, 2006.
  8. 8.0 8.1 Client Alert: "Legislative Developments in Export Controls and Economic Sanctions," Latham & Watkins LLP, undated 2007.

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