Fundraiser faces arrest in multiple gaming debts

By Jeff German

Thursday, May 29, 2008 | 2 a.m.

A Las Vegas judge has issued a felony arrest warrant for a politically connected Chicago businessman whose ties to Democratic presidential contender Barack Obama have become an issue in the campaign.

Antoin “Tony” Rezko, who is standing trial on federal corruption charges in Chicago, is wanted in Las Vegas for failing to pay $472,275 in gambling debts to Caesars Palace and Bally’s and related processing fees to the Clark County district attorney’s office.

The total unpaid Strip bill comes to more than $800,000, however, because the Bellagio obtained a judgment of default against Rezko a year ago for not repaying $331,000 in gambling markers.

A federal jury has been deliberating Rezko’s fate the past two weeks following two months of testimony in a corruption trial linked to the administration of Illinois Gov. Rod Blagojevich.

Rezko, a 52-year-old real estate developer and fast-food entrepreneur, was once considered part of Blagojevich’s inner circle, as well as a prominent donor and fundraiser for Obama.

Obama acknowledged early in the campaign that it had been a mistake to enter into a 2005 land deal with Rezko at a time when the businessman was under federal scrutiny.

While at a Chicago law firm, Obama also had done legal work involving housing developments owned by Rezko. In the Las Vegas case, records show, Justice of the Peace Nancy Oesterle issued the warrant for Rezko’s arrest May 20 at the request of Chief Deputy District Attorney Bernie Zadrowski, who runs the bad check unit. Unpaid casino markers are treated as bad checks in Nevada.

Zadrowski and District Attorney David Roger declined to comment, but courthouse sources said Las Vegas authorities, aware of Rezko’s trial in Chicago, notified federal authorities there about the outstanding warrant Tuesday. If Rezko is convicted in Chicago, he’ll likely remain under the supervision of federal authorities and the Nevada charges will take a back seat, the sources said.

Rezko was charged in a criminal complaint in Las Vegas on May 13 with two counts of fraud stemming from $250,000 in gambling debts at Caesars Palace and $200,000 in markers at Bally’s.

At Caesars, between March 25 and July 14, 2006 Rezko cashed a $195,000 personal check that came back for insufficient funds and was given $55,000 in markers on four other occasions, according to the complaint. He also was given four markers totaling $200,000 on July 13, 2006, at Bally’s, the complaint said.

Records show that Rezko made two restitution payments through the district attorney’s office of $7,500 each on Oct. 24 and another payment of $7,500 on Dec. 7. No additional payments were made.

Gary Thompson, a spokesman for Harrah’s Entertainment, which owns Caesars Palace and Bally’s, declined to comment Wednesday. So did Chicago attorney Howard Adelman, who sources said had discussions about the debts with the district attorney’s office on Rezko’s behalf.

Harrah’s brought the two cases to the district attorney’s office July 23. The $472,275 tab includes fees mandated by state law to help fund the bad check unit.

In its December 2006 lawsuit, the Bellagio alleged that Rezko cashed a $172,000 personal check with insufficient funds. It also alleged that Rezko obtained three markers totaling $159,000 on Feb. 11 and Feb. 13, 2006 and failed to pay back any of the money. The Bellagio did not ask the bad check unit to open a criminal case.

But on May 29, 2007, District Judge Valerie Adair awarded the Bellagio a judgment of default against Rezko, allowing the resort to go after the $331,000 plus interest.

Alan Feldman, a spokesman for MGM Mirage, which owns the Bellagio, declined to comment.

Rezko was indicted in October 2006 in connection with what authorities say was an influence-peddling and extortion scheme aimed at adding to Blagojevich’s campaign coffers. The governor was not charged.

In January, at a televised Democratic presidential debate in South Carolina, New York Sen. Hillary Clinton referred to Rezko as a “slum landlord.” Later, a photo of Hillary and Bill Clinton with Rezko surfaced, and when she was asked about it, the senator was quoted as saying, “I don’t know the man. I wouldn’t know him if he walked in the door.”

Jeff German is the Sun’s senior investigative reporter.