An Illinois doughnut mogul forged ties last year to Gov. Rod Blagojevich, through campaign donations and a real-estate deal involving the governor's wife, while seeking to expand his Dunkin' Donuts business into the state's tollway oases, according to a Tribune investigation.
As federal investigations into influence peddling swirl around the Blagojevich administration, the developments raise new questions about the governor accepting money -- personally or politically -- from those seeking favor with the government he leads.Amrit J. Patel, 60, one of the largest and most influential Dunkin' Donuts owners in the Chicago area, says he was not trying to win favor by hosting a fundraiser for the governor at his Northbrook home or through his family connections to a private property deal that paid Blagojevich's wife more than $30,000 in real estate commissions.
Both those moves, however, came as Dunkin' Donuts was trying to finalize an agreement to take over leases at the state's seven tollway oases. Patel acknowledged that he began pursuing a tollway lease in 2005 but said Dunkin' corporate officials took over the effort months before he began his political activities.
But more than a half-dozen of Patel's fellow franchisees say he was always a driving force behind those negotiations.
"Amrit was part of it," said Abdul R. Panjwani, a Chicago-area Dunkin' Donuts owner close to Patel. "You need to call him."
The Tribune found no indication Blagojevich intervened in the Dunkin' Donuts effort to replace its beleaguered competitor Krispy Kreme -- a deal that stalled late last year over contract issues. Blagojevich has not responded to questions about the potential conflict of interest.
But the governor's oft-repeated pledge to end pay-to-play politics and toughen campaign finance laws has clashed with revelations about his top supporters parlaying their connections with him into state jobs or state business. In recent months those revelations have expanded to include Patricia Blagojevich's real estate business and raised questions about the intersection of public policy and the Blagojeviches' personal finances.
The Tribune revealed in October that Patricia Blagojevich, a licensed real estate broker, earned $113,000 in commissions through a woman with a state contract and her banker husband -- Anita and Amrish Mahajan. At the time, the governor dismissed those inquiries as "Neanderthal" and "sexist."
Now, dozens of interviews and a review of records reveal that Patel was also involved in one of those real estate deals at the same time he was leading the effort to replace Krispy Kreme inside the state's seven tollway oases. Such a deal needs the approval of the executive director of the Illinois State Toll Highway Authority, who is appointed by the governor.
Records show Patricia Blagojevich made $34,000 in June 2006 representing Patel's daughter Sheila, an agent for several of her father's businesses, and the Mahajans. Patel is a longtime friend and associate of Amrish Mahajan, president of Mutual Bank and a major Blagojevich fundraiser.
That $1.75 million deal -- and the three others involving the Mahajans -- accounted for all the commissions Patricia Blagojevich earned in the first 10 months of 2006.
Since the Tribune raised questions about those land deals and the Mahajans' connections with the First Family, Mahajan and his wife, Anita, have come under scrutiny over her long-standing, no-bid state contract. She was charged in March with six felonies related to allegations she billed the state for more than $2 million in drug tests her Chicago-based company never performed.
She hasn't entered a plea and her attorney declined to comment for this report.
A review of records and interviews show Patel has long been a bank customer of Mahajan, who financed Patel's doughnut empire and has built a reputation as a powerful political player within the Indian community.
In a recent interview at his lawyer's office, Patel acknowledged his ties to Mahajan. He said his interest in state politics was unrelated to his business dealings.
Patel -- whose Dunkin' Donuts empire includes 25 stores and authority over a co-operative that distributes doughnut ingredients through 13 Midwestern states -- said he had "no involvement whatsoever" in 2006 when Dunkin' Donuts was in negotiations to replace Krispy Kreme.
Anyone who suggests otherwise is "just guessing," he said. Patel said he hosted the April 2006 fundraiser with advice from Mahajan, who helped raise more than $500,000 for Blagojevich since 2001.
In the spring of last year, Patel's fundraiser was among a series of private events that raised more than $100,000 from some 42 owners of Dunkin' Donuts shops, their business partners or firms that do business with Dunkin' Donuts. Thirty-three of those donors had never before donated to the governor, who attended the events and made brief remarks.
'That was personal'
Several of the Dunkin' donors said Patel was behind the effort to get into the tollway at the time, but their donations had nothing to do with it.
"That was personal," said Varsha Patel, who with her husband owns several Dunkin' Donuts stores. The two are not related to Amrit Patel, although he is their partner.
"I was told I could meet the governor, and I said I would like to see the governor," she said. State records show Varsha and Bindesh Patel donated $22,000 to Blagojevich's campaign in May 2006.
Abdul Kamruddin, who owns seven Dunkin' Donuts stores and donated $3,000 to Blagojevich in June, said he declined Patel's invitation to discuss the tollway last summer.
"I told him I was not interested in the tollway. I already have seven stores," Kamruddin said. "I have no interest in expanding. I have an interest in retiring."
Dunkin' Donuts spokeswoman Susanne Norwitz acknowledged her company began negotiating in February 2006 and was "in the mid- to late stages" when talks ended in September. She said Dunkin' Donuts was asked by Chicago-area franchisees to "get involved in brokering a deal, and then when we dropped out, those same franchisees sort of stepped in."
She declined to name the franchisee leading that effort. All the Dunkin' Donuts franchisees who said they were aware of that effort identified Amrit Patel as the driving force.
A tollway spokeswoman said the agency was unaware of Dunkin' Donuts' interest and has no control over lease negotiations. She referred questions to Wilton Partners, the California company hired by the tollway to lease space at the oases.
Scott Mayer, Wilton's president, said in a written statement that the negotiations with Dunkin' Donuts ended after his firm was reminded of terms in the Starbucks lease that precluded franchises that primarily serve coffee, such as Dunkin' Donuts, from entering those oases. He declined to elaborate. Ties between tollway vendors and Blagojevich fundraisers have surfaced before.
In 2005, the Tribune reported that two fast-food franchises at the tollway oases, Subway and Panda Express, had ties to Blagojevich insider Antoin "Tony" Rezko. Later that year, federal authorities subpoenaed tollway records related to the restaurants, which had received discounted rents.
No charges related to that investigation have been filed. But Rezko, a longtime Blagojevich adviser and major fundraiser, was indicted on unrelated charges of soliciting kickbacks from firms seeking state business. Rezko and the governor's office acknowledge Patricia Blagojevich had an eight-year business relationship with Rezko that ended in 2004. An attorney for Rezko declined to comment.
Amrit Patel has his own ties to Rezko.
In July 2005 Rezko tried to sell Patel his Panda Express restaurant near Patel's Dunkin' Donuts at O'Hare International Airport.
"He said, 'I have to get out from Panda Express,' " Patel said. "I told him to call Ira Marcus, my attorney. He wanted to sell the Panda. . . . In the end, there was no deal."
Patel said the tollway never came up. But it was at about the same time, Patel said, that he became interested in securing a tollway lease. Patel said that in July or August 2005, his son, who is also his general manager, began to make inquiries about moving into oases where Krispy Kreme had not yet opened. Lagging sales and legal troubles had left Krispy Kreme near collapse, and it was struggling to fulfill its lease obligations.
Patel said his contact with Wilton Partners ended in September 2005 after representatives of Dunkin' Donuts' Inc. told him they would take over negotiations.
" Dunkin' Brands is the gatekeeper," Patel said of Dunkin' Donuts' parent company. "They say who can and who can't."
He would not discuss whether he made arrangements to operate stores if Dunkin' Donuts got a tollway deal and said he has never discussed the tollway effort with the governor. Patel said he had lost interest in the tollway by the time of his April 2006 fundraiser.
"I didn't have the time," he said.
Patel said he was told by the governor's campaign that the event at his home raised about $50,000. But records show it was the beginning of the unprecedented show of support from Dunkin' Donuts owners and associates that ended in June. A Tribune review of public records found they donated more than $118,000 to Blagojevich.
Patel acknowledged he is well-known among Dunkin' Donuts store owners for his role as president of the Dunkin' Donuts Midwest Distribution Center, which supplies more than 700 stores. But he said he had no involvement in the other fundraisers.
"I never asked anybody to give a donation," he said. "I didn't push anybody."
Devon Avenue deal
Between May and September 2006, Patricia Blagojevich helped the Mahajans buy four properties worth $5.7 million. In one of those deals, according to records and interviews, the Mahajans agreed to buy a commercial building along Devon Avenue in Chicago. They turned over the sales contract to Patel's daughter Sheila prior to the closing. Patricia Blagojevich represented Sheila Patel at the June 28 closing, according to seller Christov Dosev and his attorney.
Office addresses listed for Sheila Patel, a lawyer who is the registered agent for several of her father's doughnut businesses, match those of her father's businesses and home. Amrit Patel said he was unaware of his daughter's involvement with his longtime friend to purchase the building, less than two blocks from her father's business headquarters.
"She's an individual person," he said. "She handled that herself."
Sheila Patel declined to comment through her father's attorney.
Updated on talks
By July 2006, Dunkin' Donuts national representatives had progressed so far in negotiations with Wilton Partners that they had begun to discuss lease terms with their Chicago franchisees, Patel said.
He said he learned of the progress from his son and general manager. While Patel reiterated he was no longer interested in the tollway, he said his son was curious and participated in a conference call among franchisees to discuss the possible lease terms.
But Ramesh Goyal, a Dunkin' owner who is involved in lawsuits with corporate headquarters over his stores, said Patel told him he was involved in the 2006 negotiations.
"Amrit just told me a few weeks ago that he and Dunkin' Brands tried to negotiate a lower rent," Goyal said in a recent interview.
Larry Gill, director of operations for Dunkin' Brands, said the company is still interested in getting Dunkin' Donuts into the oases if the deal is right.
"It's something we'd like to do, yes," he said.
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*Amrit J. Patel, 60, owner or partner in 25 Dunkin' Donuts stores and president of the Midwestern cooperative that buys and distributes doughnut ingredients to Dunkin' stores in 13 states. Last year, Patel hosted Gov. Rod Blagojevich at a fundraiser and was connected to a private real estate deal that paid the governor's wife $34,000. Patel has been trying to win a lease to put his stores at the state's seven tollway oasis locations.
*Amrish Mahajan, 61, president of Mutual Bank and Patel's longtime friend and business associate. Mahajan's bank financed Patel's Dunkin' Donuts empire. Mahajan has raised more than $500,000 for Blagojevich. His close ties to the governor have come under scrutiny amid allegations that his wife bilked a no-bid state contract for millions.
*Anita Mahajan, 55, owner of the now-defunct K.K. Bio-Science Inc., which abruptly shut down in January amid an investigation into its long-standing no-bid contract to do urine tests for the Illinois Department of Children and Family Services. Mahajan has not yet entered a plea to felony charges that she billed more than $2 million for drug tests her Chicago-based company never performed.
*Patricia Blagojevich, 41, the governor's wife and owner of River Realty Inc. From May 25 through Sept. 28, 2006, she earned $113,700 in real estate commissions through the Mahajans in four transactions involving property worth $5.71 million. In one of those deals, the sales contract signed by Anita Mahajan was transferred to Amrit Patel's daughter prior to closing. Blagojevich represented Patel's daughter in that deal, worth $1.75 million, and earned a $34,825
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