An unnamed presence in the Michael Madigan indictment: AT&T
Federal indictments are rarely subtle, but the bombshell racketeering charges filed against former Illinois House Speaker Michael Madigan last week contained an under-the-radar twist that could have big implications for telecommunications giant AT&T.
Eight pages into the 106-page document, a paragraph describing the overarching racketeering scheme stated Madigan allegedly used his various positions in elected office and the Democratic Party to “cause various businesses to employ, contract with, and make direct and indirect monetary payments” to his allies.
The payments were meant to reward and promote the loyalty of Madigan’s selected associates and were made at times “in return for little or no legitimate work performed for the benefit of the businesses,” the indictment stated.
Though the indictment specifically used the plural, “businesses,” only one company, Commonwealth Edison, has so far been named as having participated in that alleged conduct.
Ninety-five pages later, the indictment ends with two forfeiture allegations, representing money prosecutors will seek to collect as ill-gotten gains from Madigan and his co-defendant, Michael McClain, in the event of a conviction.
The first forfeiture seeks funds that “include but are not limited to approximately $2,850,337.” The second forfeiture is slightly lower, pegged at $2,827,837.
The difference between the numbers? $22,500.
That figure may seem insignificant, but it happens to be the exact amount of a consulting contract that AT&T has acknowledged is under scrutiny by the U.S. attorney’s office as part of the investigation into Madigan’s political operation.
Last month, AT&T disclosed in a regulatory filing that federal prosecutors had notified them they were considering filing criminal charges against its Illinois subsidiary, formally known as Illinois Bell Telephone Co. LLC, involving “a single, nine-month consulting contract in 2017″ worth $22,500.
State records show the company that year had hired a stable of Madigan-connected lobbyists working for the Illinois subsidiary as AT&T was fighting for a controversial bill to end landline service.
The Tribune reported last week that investigators were specifically looking at thousands of dollars in payments allegedly passed to former state Rep. Edward Acevedo, a onetime member of Madigan’s leadership team who’d recently left the General Assembly.
The payments to Acevedo were made via a lobbying contract between AT&T and Thomas Cullen, a former Madigan staffer and longtime political strategist aligned with the speaker, two sources told the newspaper.
Acevedo was a registered lobbyist at the time, state records show, but not for AT&T, and the sources said the amount of work Acevedo actually did for AT&T is in question.
Neither Cullen nor Acevedo has been charged with any wrongdoing involving AT&T, and there was no indication in the SEC filing that they might be in legal jeopardy.
A spokesman for AT&T declined to comment Monday on the Madigan indictment, referring instead back to the SEC filing.
A spokesman for U.S. Attorney John Lausch also declined to comment.
AT&T’s filing with the U.S. Securities and Exchange Commission said the subsidiary has been cooperating since 2019 in the “widely reported investigation of certain elected Illinois politicians and related parties for corruption.”
“Based on our own extensive investigation of the facts and our engagement with the U.S. attorney’s office, we have concluded that the contract at issue was legal in all respects and that any charge against Illinois Bell or its personnel would be without merit,” the filing stated.
Madigan, 79, who was dethroned from his role as speaker in January 2021, was indicted Wednesday by a federal grand jury on racketeering charges alleging his elected office and political operation were a criminal enterprise that provided personal financial rewards for him and his associates.
The 22-count indictment came after a yearslong federal investigation and alleges Madigan participated in an array of bribery and extortion schemes from 2011 to 2019 aimed at using the power of his office for personal gain.
Also charged was McClain, 74, of downstate Quincy, who is a former legislator and lobbyist and was a longtime confidant to Madigan during his record reign as speaker.
Both Madigan and McClain have denied wrongdoing. They’re scheduled to be arraigned Wednesday in a telephone hearing before U.S. Magistrate Judge Jeffrey Cole.
Federal investigators first focused on the payments to Acevedo more than two years ago as part of a broader probe into whether AT&T was improperly rewarding those favored by Madigan in exchange for the speaker’s help with the landline bill, according to the sources familiar with the matter.
Several other contracts AT&T gave to other Madigan-connected lobbyists were also being scrutinized, and investigators have interviewed numerous people involved in the company’s lobbying push, sources said.
That investigation appeared to be on the back burner for months as the U.S. attorney’s office focused on similar allegations against utility giant Commonwealth Edison, which has been accused of trying to influence Madigan by funneling money to lobbying and consulting firms headed by the speaker’s allies.
Five people, including McClain, and former ComEd CEO Anne Pramaggiore, have been charged with bribery conspiracy as part of that case, while ComEd entered into a deferred prosecution agreement admitting its conduct in the scheme in exchange for prosecutors dropping the charges in 2023. Madigan’s former chief of staff, Tim Mapes, was charged last year with lying to a federal grand jury investigating the case.
Also charged as an offshoot of the ComEd investigation was Acevedo, who pleaded guilty in December to evading about $37,000 in taxes owed on income from his consulting business from 2015 to 2017. Though the charges don’t specifically mention ComEd, Acevedo previously told the Tribune he’d been interviewed by federal investigators as part of that probe.
The federal scrutiny of AT&T was first revealed on the day ComEd’s deferred prosecution deal was made public in July 2020, when federal prosecutors subpoenaed Madigan’s office for “any and all documents and communications” concerning AT&T, including contracts and correspondence related to the hiring of anyone to provide consulting or lobbying services to the public utility.
Later that month, the Tribune reported that AT&T itself had been subpoenaed by federal prosecutors amid the widening criminal probe into Madigan’s vaunted 13th Ward operations. In a statement to the Tribune at the time, AT&T said only that, in general, it cooperates with any requests from law enforcement.
“Like all companies, from time to time we are required by law to provide information to government and law enforcement agencies,” the statement read. “As always, we cooperate with their fact gathering process.”
Similar to the ComEd case, AT&T had a big legislative goal in 2017: passing a controversial bill to end traditional landline telephone service to the remaining 1.2 million customers in Illinois.
Critics of the landline bill including the AARP Illinois and the Citizens Utility Board watchdog group were pushing back, saying the legislation would leave behind hundreds of thousands of Illinois residents, particularly seniors, who disproportionately rely on traditional landline telephone service for everything from connecting with family to monitoring life-threatening medical conditions.
In the midst of the debate, former Madigan political director Eileen Mitchell returned to AT&T after a brief stint as then-Mayor Rahm Emanuel’s chief of staff. She is now the head of AT&T Illinois’ subsidiary.
And, like many companies trying to get legislation passed in Springfield, AT&T employed a long roster of Madigan-connected lobbyists in the run-up to the votes.
After a protracted fight, the landline bill passed during the final hours of the spring legislative session. Republican Gov. Bruce Rauner vetoed the legislation, but the Democrat-led General Assembly overrode him.
Among the lobbyists enlisted to get the bill over the hump was Cullen, one of a group of former Madigan staffers who’d capitalized on access to the speaker. Cullen lobbies for a string of notable clients, from PepsiCo to the Pharmaceutical Research and Manufacturers of America.
A onetime ComEd lobbyist, Cullen’s major utility client is now Ameren, the dominant power company in downstate Illinois.
Cullen was also one of five current and former utility lobbyists identified by the Tribune in 2019 who had written checks to Kevin Quinn, a one-time ranking Madigan aide who the speaker ousted over alleged sexual harassment of a Democratic campaign worker.
