March 3, 2010 - This has been coming for a long time: Broadway Bank in Chicago is in serious trouble, about to fail. This is politically inconvenient for Alexi Giannoulias, the current state treasurer of Illinois. He's also running the Democrat candidate for the U.S. Senate, running against Congressman Mark Kirk, hoping to fill the seat once held by Barack Obama.
It is tempting to laugh at the misfortune of Alexi Giannoulias, known to many as the "mob banker," but there is nothing funny about a bank failure. People get hurt, bank employees lose jobs, courts get tied up, stress is inflicted on investors and customers alike.
The Chicago Sun-Times has an article today in which they quote Giannoulias as admitting that the bank, owned by his family, has little chance of surviving. The article, with the laughable headline "Giannoulias 'clears air,' denies risky loan-making," is written by political reporter and Democrat apologist Abdon M. Pallasch. Excerpted from that article:
State Treasurer Alexi Giannoulias this morning strongly denied he ever engaged in “reckless” or “risky” loan-making when he served as chief loan officer for his family’s now-struggling Broadway Bank. Starting a tour of “clearing the air” meetings with the media to talk about the bank that entered a consent decree with federal regulators just before the primary election, Giannoulias admitted, in hindsight, he probably should not [have] focused so much on real estate...
The word "mob" does not appear anywhere in the Pallasch article. The names Rezko, Giorango and Blagojevich - all of whom had big dealings with Giannoulias and Broadway Bank, are missing from the article as well. Pallasch's purpose was not to get to the real causes of the bank's looming collapse, though. Rather, it was intended as a sympathy piece for Democrat Machine candidate Alexi Giannoulias.
Pallasch continued: When pushed, Giannoulias conceded he had little hope for his family’s bank to survive, “And that breaks my heart. ... It was my father’s whole life.”
Doesn't that just tug on your heart strings? Certainly that's what Giannoulias hopes for, and he was served well by the Pallasch puff piece.
"Will the bank still be there in November for the general election?" wonders Pallasch.
|“It’s quite likely that the bank will not be around,” Giannoulias said. “There’s not a lot of capital out there for somebody to find $60, $70 million [as federal and state regulators want the Giannoulias family to reinvest in the bank in the next two months]. I hope I’m wrong.”|
Gosh, so do I, but not for the sake of, nor out of sympathy for, Alexi Giannoulias.
Giannoulias, according to Pallasch, says that "the only reason Broadway Bank appears ready to collapse is because the bottom fell out of the real estate market."
Pallasch does not explain what the bad real estate market has to do with huge loans to mob figures made before the market went sour. While wiping away Alexi Giannoulias' crocodile tears, Pallasch does not address the fact that the family of Alexi Giannoulias "pulled $70 million out of its Broadway Bank in 2007 and 2008, just as Broadway's high-octane growth strategy collided with the housing meltdown that has now put the lender's future in question."
Compare Pallasch's glossing-over of the Broadway Bank problems with a report by John Ruberry from May, 2009:
While he was campaigning for Illinois State Treasurer three years ago, Alexi Giannoulias never fully explained a couple of loans to mobster Michael "Jaws" Giorango made by his family-owned bank. That financial institution, Broadway Bank, also bankrolled over $10 million in mortgages to a reputed new mafiya family. Giannoulias, who touted his banking credentials during the 2006 campaign, is quiet about that. Full Post at Marathon Pundit...
Yes, very quiet, and Pallasch doesn't want to wake anybody up so he's quiet, too. Perhaps Pallasch is simply unaware of the stench that follows Alexi Giannoulias. Or, perhaps, he has no problem with a guy who chums around with reputed and known mobsters. Maybe Pallasch sees nothing wrong with the shady dealings of Broadway Bank vis a vis Giannoulias.
Maybe Pallasch is just following orders. After all, the Chicago Sun-Times itself has been accused of going easy on Alexi Giannoulias. In a February 22 post at RedState.com, titled "Chicago Sun-Times Carries Water for the Mob’s Favorite Banker," writer Leon H. Wolf noted that "For those not familiar with Giannoulias’s sordid recent past, Giannoulias has admitted to approving a number of high-risk loans to convicted mobsters when he was acting as Vice President of his family’s bank (Broadway Bank); loans which contributed to Broadway Bank’s current financial crisis."
Wolf cites this Sun-Times article as evidence of the Sun-Times' service as waterboy to Giannoulias.
No mention in Pallasch's article about this: Tony Rezko used Alexi Giannoulias bank to float $450,000 in bad checks, while campaigning for Alexi’s brother Demetris to be placed on the Illinois Finance Authority Board. (Source)
Or this: Under the FDIC's January 25th consent decree for Broadway Bank, Alexi Giannoulias and his family were required to put at least $19 million back into the bank within 10 days to cover the bank’s allowance for loan and lease losses. By April 24th, the Giannoulias family must recapitalize roughly $94 million in order to raise the bank’s tier one leverage capital ratio to at least 9% (Consent Order DB No. 2009-DB-92). Despite Alexi Giannoulias' promise to answer questions about his banking practices if he won the Democratic primary, Giannoulias now enters his 12th day of silence. Even his new campaign chairman Senator Dick Durbin is calling on Alexi to "come clean" about his shady past. (Source: Illinois Republican Party press release, February 9, 2010)
The list of Giannoulias sins is long. AmericanTowns.com has partial list:
- Buying a state board appointment from Rod Blagojevich: $10,000
- Bankrolling Tony Rezko’s gambling problem: $450,000
- Loaning money to a convicted bookmaker and prostitution promoter: $12 million
- Loaning money to a convicted mob money launderer: $15 million
- Losing hard-earned Illinois family education savings: $85 million
AmericanTowns explains the above list here.
Senate candidate Giannoulias: Broadway Bank will "quite likely" close
Regulators Clamp Down on Giannoulias' Broadway Bank
Feds and Rezko Piecing together Ayers, Giannoulias, Obama ...
Alexi Giannoulias' $19 Million Crime Loans
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