Precinct 333

Thursday, March 17, 2005

Daley Administration Ignores Minority-Business Contracting Fraud

We've all heard about set-asides for minority-owned businesses. There's always been room for fraud in awarding those contracts, as it is not difficult to set up a front-man as the "owner/operator" of the business. The city of Chicago has ignored one such case for three years -- and the perpetrator is a major contributor to Democrat Gov. Rod Blagojevich.

Two restaurants at O'Hare Airport have been allowed to rake in millions of dollars, even though the Daley administration learned back in 2002 that the company running them was probably a phony minority "front" for Panda Express and Antoin "Tony" Rezko, a top fund-raiser for Gov. Blagojevich.

Crucial Inc. won the O'Hare concessions in part because it was certified as a minority-owned business. Its largest shareholder was listed as Jabir Herbert Muhammad, son of the late Nation of Islam founder, Elijah Muhammad.

But a compliance officer inspected the firm nearly three years ago and was told by Muhammad himself that he was not running the day-to-day operations of the restaurants as required by the city.

"Everything is done by Panda Express," certification officer William Cunniff concluded in a July 31, 2002, report obtained by the Chicago Sun-Times. "Herbert Muhammad said that he was used to get Panda in the airport."

Crucial "seems to be a front for [minority business enterprise] status for Panda Express," Cunniff continued, noting that Crucial appeared to be operating out of an office for "Rezko Panda Express."

When did they take action on the matter? Tuesday, March 15, 2005.

How big is the apparent rip-off of public dollars? Pretty big.

Crucial -- which at one point also had a concessions deal with the Chicago Park District -- grossed $15.7 million between 1999 and 2002, city records show.

Not bad -- over $5 million a year, for contracts that most businesses could not bid on because they were reserved for minority businesses. All you need is someone to be your face, and you rake in a nice chunk of cash. I wonder how much of this Muhammad got, and how much went to Rezko.

But that may not be the only fraudulent minority business involving Muhammad and Rezko.

A separate company also run by Muhammad and Rezko -- Crucial Communications -- is a minority subcontractor to SBC on the pay-telephone contract at Cook County Jail. Some county commissioners questioned what Crucial does for SBC when the telecommunications giant was awarded the no-bid, $10 million contract two years ago.

Yeah, what would the business be doing for SBC? My guess is that SBC supplies the phones, and we know that they handle all of the wiring and operations. That means that Crucial probably just took a kickback for no work.

But wait, there is more. Apparently Rezko has another minority front-man currently operating Muhammad's restaurant business for him, and this same front-man has a minority business contract himself.

Muhammad, boxer Muhammad Ali's former manager, told the city's compliance officer that Panda does pricing, marketing and contract negotiations for the O'Hare restaurants. When it came to managing Crucial's office, he said he wasn't responsible and that the work was done by Al Chaib, a Rezko business associate who has since won a Subway franchise deal at Illinois tollway oases.

You know, I just love Chicago area politics. The corruption is unbelievable, and usually you can trace it back to some Democrat office-holder. It's that way now, and it was that way in the days of Richie Daley's daddy "Hizzona DaMaya", Richard M. Daley


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