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December'1,'2014'

'
Kevin'Law,'Chair'
New'York'Gaming'Facility'Location'Board''
New'York'State'Gaming'Commission'
PO'Box'7500''
Schenectady,'New'York'12301J7500'
'
Dear'Mr.'Law:'
'
We'write'to'commend'the'Board'on'conducting'an'RFA'evaluation'process'free'of'political'
interference.'''
'
The'Chairman'of'one'RFA'respondent'J'ChicagoJbased'Rush'Street'Gaming'J'was'on'the'
edge'of'two'corruption'scandals'in'which'campaign'contributions'played'an'important'role.''
The'CEO'of'Rush'Street'was'also'on'the'edge'of'one'of'the'scandals.'
!
Rezko!Scandal!(Illinois)!
Questions'arose'during'the'federal'prosecution'of'Blagojevich'fundraiser'Tony'Rezko'
regarding'campaign'donations'to'Republican'Jim'Ryan's'gubernatorial'campaign'and'the'
role'played'by'the'Ryan'campaign'Finance'Chairman'J'who'was'also'a'Rezko'associate.'
'
On'October'1,'2002,'Rush'Street'CEO'Greg'Carlin,'along'with'six'principals'from'Rush'Street'
Chairman'Neil'Bluhm's'private'equity'real'estate'investment'management'firm'Walton'
Street'Capital,'donated'a'total'of'$33,500'to'the'Ryan'campaign.i'
'
On'October'29,'2002,'the'Illinois'Teachers''Retirement'System'(TRS)'board'voted'to'invest'
$75'million'in'Walton'Street'Real'Estate'Fund'IV.ii'
'
At'the'time,'Ryan'campaign'Finance'Chairman'Stuart'Levine'was'also'a'member'of'the'
Teachers'Retirement'System'of'Illinois'board'(TRS).'Rezko'and'Levine'had'corrupted'the'
pension'fund'in'a'kickback'scheme'after'Levine'helped'engineer'a'takeover'by'nonJ
teachers'of'the'TRS'board.iii'''
'
Levine'testified'against'Rezko'after'pleading'guilty'to'money'laundering'and'mail'fraud.iv''
The'federal'judge'at'Levine's'sentencing'declared,'"You'were'certainly'one'of'the'most'
corrupt'individuals'this'district'has'ever'seen."v'
'
"Levine'absolutely'did'not'ask'me'or'anybody'else'at'Walton'Street'to'make'a'contribution'
or'contributions'to'Jim'Ryan's'campaign'in'exchange'for'helping'or'in'any'way'related'to'
Walton'Street'getting'TRS'business,"'Bluhm'told'the'Chicago'SunJTimes.vi'
'

Levine'claimed'in'testimony'at'the'Rezko'trial'that'he'supported'TRS'giving'a'contract'to'
Walton'Street'not'because'of'the'campaign'contributions,'but'because'"Mr.'Bluhm'was'a'
friend."vii'
'
Silvester!Scandal!(Connecticut)!
Paul'Silvester'was'appointed'Treasurer'of'Connecticut'in'July,'1997'to'fill'the'remainder'of'
an'unexpired'term.viii''The'Treasurers'Office'in'Connecticut'manages'the'states'multiJ
billion'dollar'pension'funds,'and'the'Treasurer'has'the'authority'to'make'investment'
decisions'for'these'funds.ix'
'
Silvester'received'kickbacks'from'finder's'fees'paid'to'consultants'by'investment'firms.''
One'such'consultant'was'Christopher'Stack.''As'the'New$York$Times$reported,'Government'
prosecutors'granted'Mr.'Stack,'a'lawyer,'immunity'in'exchange'for'his'testimony'about'the'
scheme'arranged'by'Mr.'Silvester,'which'allowed'Mr.'Stack'to'collect'consultant'fees'for'
investments'that'he'said'he'knew'nothing'about'and'funnel'a'portion'of'them'back'to'Mr.'
Silvester.x'Connecticut'later'disclosed'Walton'Street'had'paid'Stack'$494,062'in'fees'in'
1998'and'1999.xi''''
'
Silvester'also'used'his'office'to'raise'funds'for'reJelection'despite'it'being'prohibited'to'do'
so:'
In'1998,'Silvester,'who'had'been'an'interim'appointment'as'Treasurer,'decided'to'
run'for'a'full'term'and'needed'to'raise'funds'for'his'campaign.''As'state'law'
prohibited'investment'firms'doing'business'with'the'Treasurers'Office'from'
contributing'to'the'race'for'Treasurer,'Silvester'instead'attempted'to'raise'money'
for'the'Connecticut'Republican'Party,'which'agreed'to'contribute'70%'of'the'
amount'Silvester'raised'to'Silvesters'campaign.'xii'
'
And'in'1998,'Walton'Street'received'a'$75'million'commitment'and'the'state'Republicans'
received'donations'of'$15,000'from'Walton'Street'executives'and'employees'after'a'
Chicago'meeting'between'Walton'Street,'Silvester,'Stack'and'the'GOP'State'Chairman:xiii'
'
April 1998: Silvester, Christopher Stack and GOP State Chairman Chris DePino traveled
to Chicago to meet with Walton Street executives.
June, 1998: the Connecticut Pension fund invested $75 million in Waltons second real
estate fund.
August, 1998: Walton executives and employees donated $15,000 to the Connecticut
State Republican Party.
'
Silvester'pled'guilty'to'money'laundering'and'violating'the'RICO'(Racketeer'Influenced'and'
Corrupt'Organization)'Act'on'September'23,'1999.xiv''Chris'Stack'had'agreed'to'cooperate'
with'federal'prosecutors'and'admitted'paying'kickbacks'to'Silvester.xv'
'
In'November,'1999,'Pensions$and$Investments$reported'that'a'Walton'Street'managing'
principal'"said'the'firm'has'fully'cooperated'with'the'U.S.'attorney'[sic]'and'it'is'not'the'

target'of'any'investigation.''We'knew'nothing'of'his'[Stack's]'involvement'with'Silvester'
and'nothing'of'their'activities.''"xvi'
'
Conclusion!
Rightly'or'wrongly,'casino'licensing'decisions'are'generally'met'with'a'great'deal'of'
cynicism.'''
'
Your'work'to'protect'the'integrity'of'the'gaming'industry'in'New'York'is'especially'
praiseworthy'given'the'challenging'atmosphere'in'which'you'must'do'your'public'service.'
'
'
Sincerely,'
'
'
Chris'Magoulas'
Assistant'to'the'President'
UNITE'HERE'International'Union'
'
'
cc:'
Paul'Francis'
Dennis'E.'Glazer'
Stuart'Rabinowitz'
William'C.'Thompson,'Jr.'
Robert'Williams'
Mark'Gearan'
John'A.'Crotty'
Peter'J.'Moschetti,'Jr.'
John'J.'Poklemba'
Barry'Sample'
Todd'R.'Snyder'
'
Notes'
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i

Illinois State Board of Elections, Campaign Finance Reports.


Fusco, Chris, Jim Ryan backers got rich pension deals. Chicago Sun-Times, November 30, 2009.
iii
Korecki, Natasha, "Tony Rezko sentenced to 10-1/2 years in kickback scheme." Chicago Sun-Times, November 22, 2011.
Bob Secter and Jeff Coen, "Rezko gavel-to-gavel: Weeks 3-4," The Chicago Tribune. March 21, 2008; 1:08 p.m. update.
Retrieved March 19, 2012 from http://www.chicagotribune.com/news/politics/chi-rezko-court-3-story,0,7724442.htmlstory
iv
Plea agreement and Judgment (Sentencing Order), US v. Stuart Levine, 05 CR 691.
v
Sweeney, Annie, "Political insider Stuart Levine sentenced to 5 1/2 years in prison." Chicago Tribune, July 20, 2012.
vi
Fusco, Chris, Jim Ryan backers got rich pension deals. Chicago Sun-Times, November 30, 2009.
vii
Fusco, Chris, Jim Ryan backers got rich pension deals. Chicago Sun-Times, November 30, 2009.
viii
Keating, Christopher, Rowland swears in five state officials: Treasurer, Technology and Utility Appointees entering troubled
waters. Hartford Courant, August 15, 1997.
ix
United States v. Triumph Capital Group, 544 F.3d 149 (2d Cir. 2008).
x
Stowe, Stacy, Trials and Errors. New York Times, July 17, 2005.
http://www.nytimes.com/2005/07/17/nyregion/nyregionspecial2/17where.html?pagewanted=all.
xi
State of Connecticut Treasurer's Office, "RESPONSES TO REQUESTS FOR DISCLOSURE" (Revised 4/13/00).
ii

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xii

United States v. Triumph Capital Group, 544 F.3d 149 (2d Cir. 2008).
Lender, Jon, Probe Targets State GOP: U.S. seeks evidence of fund-raising scheme involving ex-treasurer. Hartford
Courant, July 28, 2000.
xiv
USA v. Silvester, U.S. Dist. Ct. CT.
xv
Pazniokas, Mark, Dan Haar, and Jack Dolan, Nappier Releases list of finders: top politicians linked to pension fund deals.
Hartford Courant, October 21, 1999.
United States v. Triumph Capital Group, 544 F.3d 149 (2d Cir. 2008).
xvi
Williams, Terry, Continuing Probe: Veritas identified as having used suspect agent, but not all responded fully to
Connecticuts inquiry. Pension and Investments, November 1, 1999.
xiii