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Questions Raised on Carlyle Lobbyist
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"Rather than use a more expensive Wall Street firm, we decided to use someone from Illinois who was familiar with the state and the different institutions there," Ullman said.
Carlyle disclosed its fee arrangement with Kjellander to the pension fund, Ullman said. The fees have no financial impact on the pension fund, he said.
The Illinois controversy has become a subject of partisan political debate.
Democratic National Committee Chairman Howard Dean called attention to Kjellander's fees and the federal probe in a statement last week, saying, "The roots of the Republican culture of corruption are getting deeper."
Asked about Dean's jab at Kjellander, Republican spokesman Danny Diaz said the RNC "is fortunate to have such an accomplished and experienced individual serving as the treasurer."
The federal investigation in Illinois has targeted a major Democratic fundraiser, Chicago lawyer Joseph Cari. Cari served as one of the DNC's finance chairmen during the 2000 elections and previously was finance chairman of the Democratic Senatorial Campaign Committee.
Indicted along with Levine, the former pension board member, Cari was charged with one count of attempted extortion. He intends to plead guilty and is cooperating with the government, said his attorney, Scott R. Lassar.
The indictment alleged that Cari helped Levine in an unsuccessful attempt to shake down a Virginia real estate investment firm last year for $850,000 by pressuring it to hire a particular consultant.
Cari told lawyers for the unnamed Virginia firm that it wouldn't get the $85 million investment it was seeking from the pension fund unless it agreed to the consulting deal, the indictment said.
"Cari said this was how things are done in Illinois," the indictment said.
The Virginia firm did not sign the consulting contract, but that didn't stop it from getting the $85 million commitment, the indictment said.
According to Chicago news reports, federal authorities have subpoenaed records from the pension fund relating to its deals with a number of firms, including Hopewell Ventures, founded by David C. Wilhelm, a former DNC chairman and manager of Bill Clinton's presidential campaign in 1992.
"Our lawyers have confirmed that neither David nor Hopewell are the subject of any investigation by the U.S. attorney's office," Wilhelm spokesman David Lundy said.
Wilhelm's firm did not use a consultant to win business from the pension fund, Lundy said. Another spokesman for Wilhelm, Kenneth Jakubowski, said it appears that the government is looking at all the investments the pension fund made while Levine was on the board.
