I-Team Report: Lasting Ties

December 16, 2009 9:05:11 PM PST
In a rare breach of state government protocol, a long-time Illinois lawman goes on TV with the I-Team to blow the whistle on ethical misconduct by his own state agency. He says it is the result of lasting ties leftover from the administration of impeached Illinois Governor Rod Blagojevich."The echelon in the Department of Revenue and Liquor Commission are very bold and arrogant and they feel they are untouchable," said Special Agent George Gottlieb, Illinois Liquor Commission.

Untouchable and liquor have mixed together in Illinois like gin and tonic since the days of Eliot Ness. But in 2009, liquor commission special agent field supervisor George Gottlieb says certain top officials of the state revenue department are untouchable because of politics.

GOUDIE: "Do you run a risk of getting fired here?
GOTTLIEB: That's always a possibility. That thought has entered my mind and I'm sure it enters anyone's mind who comes forward and talks about corruption in the state."

After 30 years as a Chicago policeman and in military service and 10 years as a liquor investigator, Gottlieb has come forward to the state inspector general and the I-Team concerning Christopher Kelly, a one time top fundraiser and political enforcer for Gov. Rod Blagojevich.

"Chris Kelly was an emissaryof the governor," said Gottlieb.

In September, when Kelly pleaded guilty to an $8.5 million kickback scheme involving his roofing company, he was also ordered to stay away from the Logan Square nightclub V-LIVE.

Prosecutors said Kelly showed up at the club arguing with the owner and demanding to see the club's books because they said Kelly had hundreds of thousands of dollars secretly invested in the nightclub.

"I know Chris Kelly had a sizable amount of money invested. However, his name doesn't show up on the license," said Gottlieb.

GOUDIE: "Is it legal in Illinois to have a hidden interest in a bar?
GOTTLIEB: No...the fact is you can't be a silent partner. It's called subterfuge."

Four days after pleading guilty to federal racketeering charges and being pressed to testify against Blagogevich, Kelly committed suicide.

Gottlieb waited for his superiors to open an investigation of Kelly's secret role in a bar that was in his jurisdiction.

"It peaked my interest and no one from the Liquor Commission from the chain of command above called to ask me or request a complaint be issued on this. So I took it upon myself," said Gottlieb.

Gottlieb was concerned because Lainie Krozel was director of the state liquor commission and was on an infamous clout list used by Chris Kelly to ensure certain people got state jobs.

Krozel is also daughter-in-law of "highway contractor 1" in the Blagojevich indictment who was allegedly pressed for a half million dollar campaign donation in exchange for a lucrative Tollway project.

But when the revenue department's top lawyer was asked to remove Lainie Krozel from the investigation of Chris Kelly:

"He didn't feel like it was an ethical violation but he would notify the Illinois Inspector General," said Gottlieb.

By then, Gottlieb had already gone to the inspector general; filing ethics complaints about Krozel and state revenue director Brian Hamer, a Blagojevich appointee who, with Chris Kelly, sat in the inner circle of the now-ousted governor.

"Because of Ms. Krozel's close association to Mr. Kelly and Mr. Hamer's close association to Mr. Kelly, neither one should be in the chain of the custody of those reports?they both have total insight into what is going on and they can massage this report any way they want once it leaves our hands," said Gottlieb.

A state spokeswoman claims Ms. Krozel has taken herself off the Kelly investigation, but offered no support paperwork saying none is necessary. She says director Hamer never even met Chris Kelly, even though both men were close advisors to Blagojevich. She also says Hamer didn't have to take himself off the case because he has no role in liquor licensing even though it's under his command. None would speak on camera.

Agent Gottlieb did remove himself from the Kelly case admitting that he was once on a clout list and didn't want to look like a hypocrite.

Statement by the Illinois Department of Revenue

Statement by Illinois Governor Pat Quinn


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