Rezko attorneys seek his release

CHICAGO His lawyers are once again asking that Rezko be released on bond.

Thursday's witness was 72-year-old Charles "Chuck" Hannon, a self-described adventurer and husband of a wealthy North Shore podiatrist to whom defendant Rezko at one point owed as much as $7 million.

Hannon said that he met Rezko frequently at the fundraiser's office on the Near Northwest Side where his wife also owned property.

Hannon, who testified under immunity, told the jury that in 2004 Rezko asked him to pose as a consultant to a Virginia-based financial company that was trying to invest $80 million from the Illinois Teachers Pension Fund. As a consultant, Hannon would have collected one percent, or $800,000, he says would be split between himself, Rezko and Republican fundraiser Stuart Levine, who has pleaded guilty in the case and already testified as a prosecution witness.

During cross examination, defense attorney Joseph Duffy suggested the witness's testimony was concocted by Hannon's lawyers to avoid their client's prosecution. Duffy made the witness admit that when he first talked to the FBI in 2004, Hannon claimed memory loss, was treated by a neurologist and prescribed a drug most commonly used by Alzheimer's patients.

Under questioning, Hannon denied having more than a superficial relationship with the corrupt Levine but admitted he had tried in the past to be a consultant on financial deals and needed money because his wealthy wife would only give him $5,000 a month as an allowance.

Hannon also testified that Rezko told him that he periodically had his phones swept for bugs, removed the battery from his cell phone to prevent eavesdropping and once suggested Hannon's wife could get a finder's fee in connection with the planned sale or lease of the James R. Thompson Center -- the main state office building in downtown Chicago.

Unlike much of the trial testimony so far, Hannon's account tied Rezko directly to a major component of the corruption that prosecutors say was swirling around state boards and commissions three and four years ago.

Rezko, 52, is charged with scheming with attorney Stuart Levine to split a $1.5 million bribe from a contractor for a favorable vote on a hospital project and squeeze money management firms for kickbacks in exchange for business from a state pension board.

Prosecutors say Rezko parlayed the influence he gained as a fundraiser for Gov. Rod Blagojevich into the clout he need to make the plan work.

Rezko denies having anything to do with such a scheme. Levine has pleaded guilty to his role in the scheme and testified for the government. Blagojevich has not been accused of wrongdoing.

Hannon testified that Rezko had long owed him and his wife, Fortunee Massuda, millions of dollars. He said Massuda had borrowed the money from banks and turned it over to Rezko.

He said Rezko made various proposals to repay the money, and during one conversation said Massuda might be set up to get a finder's fee if Blagojevich went through with a plan to lease or sell the Thompson Center.

But Massuda had no interest in such a plan, Hannon testified.

The plan to sell the Thompson Center was floated early in the Blagojevich administration but fizzled.

Rezko has been in federal custody since Jan. 28, when U.S. District Judge Amy J. St. Eve revoked his bond, saying a $3.5 million wire transfer he received from a London-based billionaire after claiming he was broke suggested that he might flee before the start of the trial.

Rezko's lawyers announced Thursday morning, though, that they are making a fresh effort to get him out on bond. St. Eve said she wanted to give federal prosecutors a chance to reply to the motion before deciding.

The Associated Press contributed to this report.