A Chicago banker whose wife is accused of bilking millions from a no-bid state contract has helped raise more than a half million dollars for Gov. Rod Blagojevich's campaigns since 2001.
Amrish Mahajan was a driving force behind his wife's drug-screening company, now facing questions about how it kept its long-standing state contract despite troubles with taxes, licensing and years of alleged fraud.A review of records and dozens of interviews reveal the company was built on Mahajan's deep Chicago political connections and its government business grew along with his reputation as a power broker in the city's Indian community.
He has been neither charged nor implicated in the fraud case.
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Mahajan, 60, the president of Mutual Bank, is courted by city and state politicians as a man who can deliver support and money.
He is referred to as "Uncle Amrish" by the businessmen who line the predominantly Indian corridor along Devon Avenue, by his bank customers, and even by one of the governor's children.
Mahajan's ties to Blagojevich run deep--including hiring the Democratic governor's wife last year as a real estate agent on $5.7 million in private land deals.
Blagojevich has acknowledged the family friendship with the Mahajans. But he has attempted to distance himself since a Tribune report last year revealed the real estate deals involving Blagojevich's wife, Patricia.
"I know Amrish," Blagojevich said last week. "There is no relationship now."
He refused to elaborate. On Tuesday, the governor's office did not return repeated phone and e-mail messages.
Mahajan has helped organize more than a dozen Blagojevich fundraisers since 2001, often arriving with the governor, introducing him, and staying at his side through much of the evening, according to interviews with donors and a Tribune analysis of campaign finance reports.
As recently as last November, Mahajan was among a phalanx of top fundraisers from the Indian community treated as VIPs at Blagojevich's party celebrating his re-election.
"He has had many, many fundraisers for the governor," said Moti Agarwal, who hosted a Blagojevich fundraiser with Mahajan at Agarwal's home last fall that raised nearly $60,000. Agarwal is owner of a 94-room Country Inns & Suites and the holder of a $4.7 million loan from Mutual Bank.
"Amrish brought the governor. I know they are very close," Agarwal said. "He introduced us. It was nice to get to meet him, but I ask for no favors. I have no stake in anything, and it wasn't to gain any business for me."
At least $300,000 donated at Mahajan-organized events has come from customers with more than $70 million in loans from Mahajan's bank, the Tribune found. At least another $200,000 was raised from others at those fundraisers.
At one political event last year, the governor's 10-year-old daughter, Amy, was overheard by at least two Blagojevich supporters interviewed by the Tribune referring to Mahajan as "Uncle Amrish."
Reached Tuesday at his Mutual Bank offices in Chicago, Mahajan referred all questions to his attorney.
Terence Gillespie, whose law firm represents the Mahajans, declined to address the specifics of this report. But he said "no one has alleged that Mr. Mahajan has done anything illegal or improper, and certainly having a friend in the governor is not improper."
Mahajan's wife, Anita, was arrested last week on charges of overbilling millions of dollars on her state contract to provide drug screenings to clients of the Illinois Department of Children & Family Services. Her downtown Chicago company, K.K. Bio-Science Inc., has held the no-bid state contract since the early 1990s.
The arrest followed a Tribune report last year raising questions about the $113,000 in real estate commissions Patricia Blagojevich earned through the Mahajans. They were the only commissions she earned in the first 10 months of 2006, according to Multiple Listing Service records.
Blagojevich has said the Tribune's questions about his wife's dealings with a state contractor are "Neanderthal" and "sexist" because they suggest she can't earn a living on her own.
In announcing Anita Mahajan's arrest last week, Cook County State's Atty. Richard Devine said he intends to keep investigating why her contract was "out of kilter with past practices and past contracts." He said her company was able to keep its DCFS contract despite unpaid state and federal taxes.
The Tribune found no cases in which K.K. Bio-Science contracts were signed by the Blagojevich administration while the company owed taxes. But state investigators said the newspaper's questions about the tax bills prompted their probe.
K.K. Bio-Science's most recent state contract was worth more than $739,000.
In 1995, the company lost drug-screening contracts for Chicago police and fire employees after it was accused in a lawsuit of not being properly licensed by federal authorities. Records show that in that same year, the company's state business went from $74,000 to nearly $300,000.
A review of the city files involving K.K. Bio-Science--originally known as Tox-Tech until a name change in the 1990s--shows that it was incorporated in 1986 by Mahajan's relatives and Richard P. Parrillo, a Chicago insurance mogul whose family has hobnobbed with gangsters and governors.
Parrillo's father was a lawyer for Al Capone, and his brother, Donald, says he became 1st Ward alderman after being asked to run by then-Outfit chief Sam "Momo" Giancana. Richard Parrillo, a close friend of George Ryan, raised hundreds of thousands of dollars to defend the former Republican governor against corruption charges.
Parrillo described himself as Mahajan's "mentor and sponsor" ever since the Indian immigrant, who was in his 20s at the time, came to him looking for a job in the 1970s.
According to Richard and Donald Parrillo, Mahajan's entree into city politics began when he stopped to help an old man who had fallen on a city sidewalk. The old man happened to be on his way to a meeting with the first Mayor Richard Daley. The kind deed won Mahajan his first audience with the legendary politician.
"Mahajan told the mayor he wanted to get into banking, and the mayor told him to go see the alderman--that was me," said Donald Parrillo, now locked in a family feud with his brothers. "Before I knew it, my brother had hired him."
Mahajan quickly became a vice president at National Republic Bank of Chicago, where Richard Parrillo was chairman.
But in 1982, the bank was indicted along with a different vice president on charges it laundered millions of dollars for a cocaine ring. The bank got 5 years' probation and was fined $10,000.
Neither Parrillo nor Mahajan were implicated. Parrillo sold his interest in the bank, and Mahajan became president under the new owners. He stayed until 1989.
Parrillo said that while he and Mahajan worked at the bank he met Anita and her father, a well-known toxicologist, and agreed to help them start the drug-screening company.
"Everyone's trying to suggest there's something nefarious going on with that contract," said Parrillo, who said he's had no interest in the company for years. "Trust me, there was no quid pro quo."
Richard Parrillo and Amrish Mahajan maintain their friendship to this day. Mutual Bank, which Mahajan helped found in 1994, has lent more than $30 million to Parrillo and his family, including helping finance Parrillo's $40 million, 27,000-square-foot mansion in Lincoln Park, records show.
Richard Parrillo said he has talked with Mahajan since his wife's arrest.
"I was totally shocked to hear what has happened," Parrillo said. "I'm very fond of the Mahajan family. These aren't the kind of people who needed this money."
In addition to helping Blagojevich, Mahajan has helped raise at least $50,000 for Chicago Mayor Richard M. Daley's campaign fund, according to records. Mahajan has served on the city's plan commission since Daley appointed him in 1989.
"He is the one true leader of the Indian community," Richard Parrillo said in a recent telephone interview from the Florida headquarters of his United Automobile Insurance Group.
Donald Parrillo said he isn't surprised to see Mahajan mix it up with politics and business. "He got that attitude from the Parrillo family," the former alderman said. "He wanted to get in the game."
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