It was part of the conspiracy that the defendants agreed that a conspirator would commit at least two acts of racketeering in the conduct of the affairs of the enterprise.

Means and Method of the Conspiracy

1. It was part of the conspiracy that defendants RYAN and WARNER, as well as other co-conspirators, engaged in a scheme to defraud the people of the State of Illinois and the State of Illinois of money, property and the intangible right to the honest services of defendant RYAN, in his capacity as a state official, and of other state officials, by means of materially false and fraudulent pretenses, representations, promises and material omissions, as more fully described in Count Two, paragraphs 2-148 of this indictment. Defendants RYAN, WARNER and certain other Associates used and caused to be used the United States mails and other interstate carriers in furtherance of the scheme.
2. It was further part of the conspiracy that defendant WARNER and other Associates provided personal and financial benefits to, and for the benefit of, defendant RYAN, RYAN family members, third parties affiliated with RYAN, and Citizens For Ryan, due to RYAN’s official position, and for the purpose of influencing and rewarding RYAN in the exercise of RYAN’s official authority.
3. It was further part of the conspiracy that defendant RYAN knowingly took actions in his official capacity to benefit the personal and financial interests of defendant WARNER and certain Associates while concealing, in violation of the law, RYAN’s financial relationship with WARNER and certain Associates.
1. It was further part of the conspiracy that defendant RYAN knowingly permitted defendant WARNER and certain Associates to participate in the governmental decision making process, and provided WARNER and certain Associates with access to material, non-public information relating to governmental decisions. With RYAN’s authority and concurrence,
2. WARNER and certain Associates converted the participatory status and information provided by RYAN into financial benefits for themselves, defendant RYAN and third parties.
4. It was further part of the conspiracy that defendants RYAN and WARNER, as well as certain other conspirators, engaged in financial transactions designed, in whole or in part, to conceal and disguise the nature, source, ownership, and control of the proceeds of the scheme, including the structuring of cash withdrawals from bank accounts to avoid the filing of currency transaction reports, the payment of funds to third parties who acted as conduits and nominees, and the payment of cash and the writing of checks to cash.
5. It was further part of the conspiracy that defendant WARNER and others committed and attempted to commit extortion, which extortion obstructed, delayed and affected commerce, by knowingly obtaining and attempting to obtain property in the form of payments from vendors and prospective vendors of the SOS Office induced by a) the wrongful use of actual and threatened fear of economic harm, and b) under color of official right.
6. It was further part of the conspiracy that defendant RYAN, Fawell and other agents of Citizens For Ryan diverted, and caused the diversion of, SOS Office labor and resources for the personal and political benefit of defendant RYAN, Fawell and Citizens For Ryan.
7. It was further part of the conspiracy that defendant RYAN and Fawell acted to terminate IG Department investigators and to reorganize the IG Department to, among other things, discourage the legitimate investigation of improper political fundraising activities and related official misconduct of SOS Office employees, and thus benefit RYAN personally and Citizens For Ryan.

17. It was further part of the conspiracy that defendant RYAN and Fawell obstructed and attempted to obstruct the Grand Jury Investigation and otherwise misrepresented, concealed and hid, and caused to be misrepresented, concealed and hidden, the purposes of and acts done in furtherance of the conspiracy.

All in violation of Title 18, United States Code, Section 1962(d).

The Scheme To Defraud

3. Beginning in approximately November 1990 and continuing to at least 2002, in the Northern District of Illinois, Eastern Division, and elsewhere:

GEORGE H. RYAN, SR. and LAWRENCE WARNER

 

Overview of Scheme

4. It was part of the scheme that defendant RYAN performed and authorized official actions to benefit the financial interests of RYAN, defendant WARNER, Associate 1, Associate 2 and certain Associates and designated third parties, including RYAN family members and Citizens For Ryan. The official actions RYAN performed and authorized included:

B. Providing defendant WARNER and Associate 1 with participatory status in, and material non-public information relating to, governmental decisions, which WARNER and Associate 1 then converted into financial benefits for themselves, defendant RYAN and third parties, as described below.

C. Awarding a real property lease and causing contractual payments to be made to benefit Associate 2, as described below;

D. Awarding, and authorizing the award of, contracts and intervening in governmental processes related thereto in order to benefit the financial interests of Associate 1, as described below; and

E. Awarding, and authorizing the award of, low-digit license plates to WARNER, Individual 1, and others, as described below.

5. It was further part of the scheme that defendant RYAN and certain third parties affiliated with RYAN received personal and financial benefits from defendant WARNER, Associate 1 and certain Associates, while defendant RYAN knew that such benefits were provided with intent to influence and reward RYAN in the performance of official acts. Such benefits included, but were not limited to, the following:

A. Monetary payments and gifts on multiple occasions to defendant RYAN which payments and gifts exceeded the $50 threshold;

B. Vacation benefits to defendant RYAN;

C. Personal service benefits to defendant RYAN;

D. Monetary payments, loans, gifts and personal service benefits to RYAN’s family members;

E. As directed and approved by defendant RYAN, the allocation and distribution to designated Associates of proceeds obtained from vendors doing business with the State of Illinois;

F. Financial support, in the form of loans to benefit Comguard, a private company which had financial troubles throughout the 1990s and which defendant RYAN supported in its efforts to obtain State of Illinois contracts for electronic monitoring of prisoners. Comguard was owned, in part, by a RYAN family member;

G. Forebearance on loans to a RYAN family member and to Comguard; and

H. Financial benefits to Citizens For Ryan, some of which benefits were converted to RYAN’s personal use.

6. It was further part of the scheme that, from the early 1990s to at least 2002, defendants RYAN, WARNER and certain Associates concealed their financial relationships with each other by, among other things:

A. RYAN knowingly failing to disclose gifts, financial benefits and things of value he received from WARNER and the other Associates as required by law and policy;

B. RYAN making false statements to federal investigators regarding his financial relationship with WARNER, Associate 2 and Individual 1;

C. WARNER and certain Associates knowingly i) filing, and causing the filing of, materially false lobbyist registration statements and related disclosure documents, and ii) failing to file lobbyist registration statements and related disclosure documents; and

D. WARNER and certain Associates structuring withdrawals, paying funds to third parties who served as conduits and nominees, making payments in cash, writing checks to cash and otherwise concealing financial transactions.

Authorizing Official Actions Related To WARNER and Udstuen

7. It was part of the scheme that, in or about early 1991, defendant WARNER and Udstuen discussed a plan to make money from one or more vendors doing business with the SOS Office and prospective vendors desiring to do business with the SOS Office.

8. It was further part of the scheme that, beginning in or about 1991 and continuing thereafter, defendant WARNER advised Udstuen that, with defendant RYAN’s knowledge and approval, WARNER would provide Udstuen with one-third of the proceeds that WARNER obtained from certain vendors doing business with the SOS Office, as a reward for Udstuen’s past service to defendant RYAN. Thereafter, defendant WARNER did provide Udstuen with one-third of the proceeds that WARNER obtained from American Decal Manufacturing (hereinafter “ADM”) and International Business Machines (hereinafter “IBM”), as described below, even though Udstuen performed minimal or no services to earn said proceeds.

1. It was further part of the scheme that, in or about 1991, defendant WARNER and Udstuen agreed that in order to conceal the flow of proceeds from WARNER to Udstuen related to the SOS Office vendors, defendant WARNER would use Alan Drazek's company, American Management Resources, as a conduit for the purpose of passing payments from WARNER to Udstuen relating to ADM and IBM, as described below. WARNER agreed to issue checks to Drazek, who in turn would provide a substantial portion of the proceeds relating to ADM and IBM back to Udstuen in cash.
2. It was further part of the scheme that, in or about early 1991, defendant WARNER told Udstuen that WARNER would be “taking care” of defendant RYAN with WARNER’s two-thirds share of the proceeds that he obtained from the vendors doing business with the SOS Office.
3. It was further part of the scheme that, beginning in the early 1990s and continuing thereafter through at least early 1999, WARNER provided personal and financial benefits to and for the benefit of defendant RYAN, including, but not limited to the following:

A. Monetary payments and gifts on multiple occasions to defendant RYAN which payments and gifts exceeded the $50 threshold;

B. Personal and professional service benefits to defendant RYAN;

C. Over $300,000 in payments to Udstuen relating to ADM and IBM’s contractual dealings with the SOS Office, as directed and approved by defendant RYAN based on Udstuen’s past service to RYAN;

D. Two loans totalling $145,000 related to Comguard, and forebearance on one of the loans;

E. A $5,000 no-interest loan for the benefit of a RYAN family member and forebearance on that loan;

F. Significant financial expenditures (in excess of $3,000) relating to the 1997 wedding of a RYAN family member;

G. Over $6,000 in financial investments in a RYAN family member’s business;

H. Over $7,000 in non-compensated professional services to a RYAN family member;

I. Financial benefits to Citizens For Ryan.

1. It was further part of the scheme that defendant RYAN concealed the personal and financial benefits he received from defendant WARNER in violation of the law and his stated policy.
2. It was further part of the scheme that defendant WARNER financially benefitted from the following contracts and leases for which defendant RYAN took and authorized official action:

The Awarding Of The Validation Stickers Contracts To ADM

14. At times material to this indictment:

A. The SOS Office Contract Award Process: In the performance of its lawful functions, the SOS Office awarded contracts for goods and services to outside entities and individuals (hereinafter collectively “vendors”). As to certain contracts, the particular SOS Office Department seeking to obtain the goods and services was generally responsible for drafting contract “specifications” which described, among other things, the technical requirements a bidding company had to meet in order to win the contract. To initiate the process, contract specifications were forwarded from the SOS Office to the Illinois Department of Central Management Services (hereinafter “Central Management Services”), a state agency independent from the SOS Office that handled certain aspects of the purchasing and procurement process for other state agencies, including the SOS Office. After receiving contract specifications from the SOS Office, Central Management Services generally solicited bids from vendors based upon the requirements set forth in the SOS Office specifications. The vendors wishing to bid on a contract had to submit those bids directly to Central Management Services, which in turn would share the bid information with the SOS Office.

B. The Validation Stickers Contract: The SOS Office periodically awarded a contract to manufacture and print vehicle registration validation stickers, which were the stickers required to be affixed to all Illinois license plates to show current vehicle registration (hereinafter the “validation stickers contract”). The Vehicle Services Department was generally responsible for preparing specifications and, along with Central Management Services, overseeing the competitive bidding process for the validation stickers contract. Up to and including 1991, the validation stickers contract, which cost the State of Illinois approximately $800,000 to $1,200,000 annually, was held by ADM.

C. At no point prior to 1991 had ADM made payments to any third parties to receive or keep the validation stickers contract. As of 1991, the existing SOS validation stickers contract with ADM included the requirement of a feature known as the “metallic security mark,” which feature was a product created and manufactured by ADM and this requirement had the effect of substantially guaranteeing the award of the validation stickers contract to ADM.

1. It was further part of the scheme that, beginning in about July 1991 and continuing thereafter, defendant WARNER made unsolicited contacts with officials of ADM and indicated to them that, in exchange for monthly payments, WARNER would ensure that the “metallic security mark” requirement would remain in the specifications for the SOS Office validation stickers contract.
2. It was further part of the scheme that defendant WARNER threatened one or more officials of ADM, stating if ADM did not pay WARNER the monthly payment amount, WARNER would cause the specifications to change such that ADM would lose the validation stickers contract. As a result of WARNER's statements and out of fear that ADM might otherwise lose the validation stickers contract, officials of ADM authorized monthly payments to WARNER in amounts dictated by WARNER.
3. It was further part of the scheme that, beginning in or about July 1991 and continuing thereafter, defendant WARNER directed a high-ranking official of the Vehicle Services Department (hereinafter “SOS Official A”) to take certain actions to financially benefit WARNER. Understanding that WARNER was acting with the authority of RYAN, SOS Official A followed WARNER’s directions.
4. It was further part of the scheme that, in or about April 1992, defendant RYAN told SOS Official A that he did not want SOS officials getting too close to a Minnesota-based company, 3M, which was a potential competitor to ADM in the validation sticker contracts.
1. It was further part of the scheme that, in or about late 1992, after SOS Official A failed to respond promptly to defendant WARNER’s contacts on official SOS Office matters, defendant RYAN contacted SOS Official A and inquired as to why SOS Official A was not
2. returning WARNER’s calls. When SOS Official A informed RYAN that he was uncomfortable with Warner because Warner was frequently intervening in his SOS Office job and manipulating SOS contracts, RYAN told SOS Official A, among other things, that WARNER was Official A’s “friend” and directed Official A to return defendant WARNER’s calls.
5. In or about 1993, the Vehicle Services Department conducted research and analysis regarding the security features of the validation stickers contract, and a committee consisting of approximately seven Vehicle Services Department employees unanimously recommended to SOS Official A that the “metallic security mark” requirement be removed from the specifications for the validation stickers contract. Shortly thereafter, SOS Official A, acting on the committee’s recommendation, caused the “metallic security mark” requirement to be removed from the specifications and the modified specifications to be forwarded to Central Management Services for initiation of the competitive bidding process.
6. It was further part of the scheme that, in or about 1993, after SOS Official A had caused the “metallic security mark” requirement to be removed from the specifications following the committee’s recommendation in order to enhance the SOS Office’s options in selecting a cost-effective qualified vendor, defendant WARNER directed SOS Official A to put back into the specifications the requirement for the “metallic security mark.”
1. It was further part of the scheme that, in or about April 1993, defendant RYAN intervened to assist defendant WARNER in his efforts on behalf of ADM by, among other things, directing SOS Official A to change the specifications back to include the “metallic security mark” to benefit ADM. RYAN further directed SOS Official A to retrieve the specifications back from CMS quietly, and SOS Official A did so, such that ADM was advantaged. Thereafter, and as a
2. result of RYAN’s conduct, SOS Official A made no effort to revise the specifications, and the validation stickers contract thereafter continued to be awarded to ADM.
7. It was further part of the scheme that, with defendant RYAN’s assistance, from about 1991 through approximately 2000, the SOS Office continued to make payments to ADM under the validation stickers contracts authorized by defendant RYAN’s SOS Office. During this period, defendant WARNER received approximately $332,000 in payments from ADM related to the validation stickers contracts. After receiving the payments, WARNER, with RYAN’s approval, provided Udstuen one-third of the proceeds through payments made through American Management Resources, as described above.

The Awarding Of The Title Laminates Contract To ADM

24. At times material to this indictment:

The SOS Office periodically awarded a contract to manufacture and print laminated strips to be affixed to vehicle titles for security purposes (hereinafter the “title laminates contract”). The Vehicle Services Department was generally responsible for preparing the specifications and, along with Central Management Services, overseeing the competitive bidding process for the title laminates contract. Up to and including 1991, the title laminates contract was held by 3M.

1. It was further part of the scheme that, in about August 1991, defendant WARNER told an official of ADM that in exchange for $67,000, WARNER would cause the SOS Office title laminates contract, then held by 3M, to be awarded to ADM. Based upon WARNER’s statements, ADM authorized total payments of $67,000 to WARNER.
1. It was further part of the scheme that, in about August 1991, at the direction of defendant WARNER, and understanding that defendant WARNER was acting with the authority
2. of defendant RYAN, SOS Official A took official actions to materially benefit ADM and to the competitive disadvantage of 3M.
2. It was further part of the scheme that, as a result of defendant WARNER’s actions, the SOS Office awarded the title laminates contract to ADM, which thereafter received the title laminates contracts through approximately September 1998.

The Awarding Of Computer-Related Contracts To IBM

The Mainframe Computer Upgrade Contract

28. At times material to this indictment:

A. The SOS Office awarded contracts to provide computer and information technology services related to SOS Office functions, including among other contracts, contracts related to installing and maintaining a mainframe computer system used throughout the SOS Office (hereinafter, the “mainframe computer upgrade contract”). The Information Systems Services Department was generally responsible for preparing the specifications and overseeing the competitive bidding process for the mainframe computer upgrade contract and other computer-related SOS Office contracts.

B. As of early 1991, Honeywell/Bull (hereinafter “Honeywell) held the existing mainframe computer system contract with the SOS Office and was attempting to ensure that it would win future computer-related contracts with the SOS Office, including the prospective mainframe computer upgrade contract. As of no later than 1992, International Business Machines (hereinafter “IBM”) desired to win future computer-related contracts with the SOS Office, including the prospective mainframe computer upgrade contract.

29. It was further part of the scheme that, beginning in or about early 1991, due to defendant RYAN providing defendant WARNER and Udstuen with participatory status in, and material non-public information relating to, governmental decisions, WARNER and Udstuen learned information pertaining to the SOS Office’s intentions regarding the mainframe computer upgrade contract.

1. It was further part of the scheme that, in or about the summer of 1991, defendant WARNER and Udstuen, and later Associate 1, met with representatives of Honeywell. During the meetings, WARNER and Udstuen, and later Associate 1, indicated that in exchange for total payments of up to $1,000,000 from Honeywell, Honeywell would be awarded one or more computer-related contracts with the SOS Office, including the prospective mainframe computer upgrade contract.
2. On or about September 24, 1991, after Honeywell declined to pay defendant WARNER, Udstuen or Associate 1 to ensure the award of SOS Office contracts, Honeywell's representative reported WARNER, Udstuen and Associate 1’s solicitation activities personally to defendant RYAN.
3. It was further part of the scheme that, at the September 24, 1991 meeting with Honeywell’s representative, defendant RYAN acknowledged, among other things, that Udstuen and WARNER were among his advisors, that RYAN had too much to lose to allow something like the alleged conduct involving Udstuen and WARNER go on in his Administration and that RYAN would “get to the bottom of it.”
1. It was further part of the scheme that, after defendant RYAN had been informed of WARNER and Udstuen’s solicitations relating to Honeywell, defendant RYAN authorized WARNER and Udstuen to assist in the process of hiring a Director of the Information Systems
2. Services Department whose responsibilities included, among other things, assisting in the selection and implementation of the mainframe computer upgrade contract.
4. It was further part of the scheme that, when Udstuen was approached for a lobbyist referral for IBM relating to potential business with the SOS Office, Udstuen referred IBM to defendant WARNER, knowing that Udstuen would profit with WARNER on any business that IBM performed with RYAN’s SOS Office.
5. It was further part of the scheme that, in or about February 1992, defendant WARNER and Udstuen interviewed a candidate for the Director position (hereinafter “SOS Official B"), and, during the interview process, SOS Official B disclosed that Official B would be supportive of selecting IBM for the mainframe computer upgrade contract. Shortly thereafter, WARNER and Udstuen recommended to RYAN that the SOS Office hire SOS Official B as the Director of the Information Services Department, and RYAN then hired SOS Official B for the position as Director of Information Services.
6. It was further part of the scheme that, in approximately March 1993, defendant WARNER entered a written contract with IBM, retroactive for services beginning July 1, 1992, and under which IBM agreed to pay WARNER a percentage of all revenues, up to $1,000,000, that were received by IBM in connection with SOS Office contracts.
7. It was further part of the scheme that, on one or more occasions, at the direction of defendant WARNER, and understanding that defendant WARNER was acting with the authority of defendant RYAN, SOS Official B took official actions to benefit WARNER financially relating to IBM.

38. It was further part of the scheme that, based, at least in part, on the actions taken by defendant WARNER, defendant RYAN awarded the mainframe computer upgrade contract to IBM, which contract payments made during RYAN’s SOS Office Administration exceeded $25,000,000.

The Kiosk Project Contract

39. At times material to this indictment:

A. Commencing in or about 1995, the SOS Office began to consider a pilot project using computerized kiosks within certain SOS license facilities to allow citizens to renew vehicle registration, obtain validation stickers and perform other vehicle titling and related registration.

B. On or about April 24, 1995, a high-ranking SOS Office official who supported the use of kiosks (hereinafter “SOS Official C”), notified defendant RYAN and Fawell in writing that there was an opportunity for the SOS Office to view kiosk demonstrations by several vendors at an upcoming event in Columbus, Ohio.

1. It was further part of the scheme that defendant RYAN, defendant WARNER and Fawell travelled to Columbus, Ohio, to attend the kiosk demonstrations, including demonstrations made by IBM and a competing vendor. SOS Official B, SOS Official C, and a representative of the competing vendor also attended the kiosk demonstrations.
2. After returning from the April 25, 1995 trip, SOS Official C recommended to other officials of the SOS Office that the kiosk project contract should be awarded to the competing vendor and not IBM.

42. It was further part of the scheme that, after SOS Official C made the

recommendation opposing IBM's selection, Udstuen, at defendant WARNER’s request, directed SOS Official C to drop Official C’s opposition to IBM's selection. Understanding that WARNER and Udstuen acted with the authority of defendant RYAN, SOS Official C did as Udstuen advised.

1. It was further part of the scheme that, due at least in part to defendant WARNER and Udstuen’s actions, in or about January 1996, defendant RYAN selected IBM for the kiosk project contract.
2. It was further part of the scheme that, from in or about 1993 through early 1999, defendant WARNER received approximately $1,000,000 in payments under his contract with IBM, principally related to the mainframe computer upgrade contract. WARNER, in turn, directed one-third of the proceeds to Udstuen, through American Management Resources.
3. It was further part of the scheme that, in or about 2000, after defendant WARNER and Udstuen learned that federal investigators were inquiring into matters relating to WARNER, WARNER and Udstuen discussed how they could further conceal the flow of proceeds that Udstuen received from WARNER.
4. It was further part of the scheme that defendant WARNER filed false and misleading lobbyist registration statements relating to IBM and failed to disclose all his RYAN-related expenditures.

Awarding of Digital Licensing Contract To Viisage Technologies

47. At times material to this indictment:

A. In approximately 1996, the SOS Office began an initiative to switch to a digital licensing system through which all State of Illinois automobile and truck drivers' licenses would be created and maintained through digital technology. The Drivers Services Department was generally responsible for preparing the specifications and overseeing the competitive bidding process related to awarding a contract for digital licensing services.

B. In approximately June 1997, the SOS Office awarded the contract to provide digital licensing and related services for the State of Illinois through approximately 2004 (hereinafter the “digital licensing contract”) to Viisage Technologies, a Massachusetts-based company (hereinafter “Viisage”).

1. It was further part of the scheme that, in about August 1996, due to defendant RYAN providing defendant WARNER with participatory status in, and material non-public information relating to, governmental decisions, WARNER learned that the SOS Office was evaluating the merits of switching to a digital licensing system and that a high-ranking SOS Office official who would have a role in the implementation of the system (hereinafter “SOS Official D”) preferred Viisage.
2. It was further part of the scheme that, in or about October 1996, defendant WARNER, working with another individual, agreed with Viisage to enter into a lobbying contract to assist Viisage in its efforts to obtain the digital licensing contract with the SOS Office, in return for a percentage of all gross revenues received should Viisage receive the digital licensing contract (the “lobbying contract”).
3. It was further part of the scheme that, in order to conceal defendant WARNER’s involvement with Viisage in the lobbying contract for the digital licensing contract, WARNER caused his name to be excluded from the initial lobbying contract, even though WARNER was to be the principal lobbyist for Viisage.
1. It was further part of the scheme that, in or about December 1996, before the SOS Office commenced the bidding process on the digital licensing contract, defendant WARNER
2. guaranteed Associate 1 payments totalling $36,000 in 1997 relating to Viisage if Associate 1 agreed to assist WARNER on behalf of Viisage. WARNER further indicated that the “cash flow” on the yet-to-be-awarded contract might not commence until mid-1997.
4. It was further part of the scheme that, due to defendant RYAN providing defendant WARNER with participatory status in, and material non-public information relating to the award of the digital licensing contract, prior to the award of the digital licensing contract to Viisage, defendant WARNER purchased Viisage stock and advised another SOS Office employee to purchase Viisage stock in order to profit from the SOS Office’s subsequent decision to award the digital licensing contract to Viisage.
5. It was further part of the scheme that, on or about June 2, 1997, after bids were received from two entities, defendant RYAN awarded the digital licensing contract to Viisage.
6. It was further part of the scheme that, shortly after defendant RYAN awarded the digital licensing contract to Viisage, defendant WARNER caused the financial interest in the lobbying contract with Viisage to be assigned explicitly to WARNER’s business. Thereafter, between approximately 1999 and November 2002, defendant WARNER received approximately $800,000 in revenues related to the lobbying contract, via the United States mails.
7. It was further part of the scheme that, beginning in approximately 1999, defendant WARNER paid Associate 1 $36,000 from WARNER’s Viisage proceeds, even though Associate 1 performed no services on behalf of Viisage.

56. It was further part of the scheme, and in order to conceal the scheme, that defendant

WARNER and Associate 1 knowingly failed to register as lobbyists for Viisage. The Awarding Of The Automated System Consulting Contract To ATC

57. At times material to this indictment:

In approximately 1991, the SOS Office began an initiative to install an automated heating and cooling system for certain State Capitol Complex buildings in Springfield, Illinois. The Physical Services Department was generally responsible for preparing the specifications and overseeing the competitive bidding process related to the automated heating and cooling system. To facilitate that process, beginning in about early 1992 and continuing through about October 1994, the SOS Office sought to award a series of engineering consulting contracts for assistance with preparing the specifications and consultations with regard to the contractual process related to the automated heating and cooling system (hereinafter collectively the “automated system consulting contract”).

1. It was further part of the scheme that, in or about 1991, due to defendant RYAN providing defendant WARNER with participatory status in, and material non-public information relating to, governmental decisions, WARNER learned that the SOS Office was seeking to award the automated system consulting contract to an outside consultant.
2. It was further part of the scheme that, in or about December 1991, defendant WARNER solicited a Northbrook-based company, Affordable Temperature Control (“ATC”) to provide consulting services under the SOS Office's automated system consulting contract. ATC agreed to provide the services.
1. It was further part of the scheme that defendant WARNER contacted a high-ranking official in the Physical Services Department (hereinafter “SOS Official E”) and told SOS Official E that WARNER had identified a contractor to receive the automated system consulting contract. Understanding that defendant WARNER was acting with the authority of defendant RYAN, SOS
2. Official E followed WARNER’s direction and caused ATC to be awarded the automated system consulting contract.
3. It was further part of the scheme that, from about January 1992 through October 1994, ATC received payments from the SOS Office for services related to the automated system consulting contract.
4. It was further part of the scheme that, after ATC had been awarded and begun work under the automated system consulting contract, defendant WARNER contacted ATC and indicated he wanted 8% of ATC's revenues under the automated system consulting contract.
5. It was further part of the scheme that between about June 1992 and October 1994, defendant WARNER received approximately $8,240 in payments from ATC related to the automated system consulting contract.
6. It was further part of the scheme that Fawell caused to be maintained and updated a confidential “master list” which was used to track and monitor official acts that the SOS Office had performed on behalf of, or relating to, a particular “sponsors,” such as defendant WARNER. On the master list, Fawell caused WARNER to be listed as the “sponsor” for ATC's selection for the automated system consulting contract.

Soliciting Modern Business Systems Relating to SOS Office Photocopier Leases

65. At times material to the indictment:

The SOS Office entered into leases with one or more vendors for the use and the service of photocopier machines at SOS Offices (hereinafter “the photocopier leases”). Each SOS Office Department seeking to use a photocopier within that Department was generally responsible for negotiating the terms and conditions of the photocopier leases. Up to and including 1991, Modern Business Systems, Inc. held several of the photocopier leases with the SOS Office.

1. It was further part of the scheme that, in or about mid-1991, due to defendant RYAN providing defendant WARNER with participatory status in, and material non-public information relating to, governmental decisions, WARNER learned that Modern Business Systems, Inc., which then held certain of the SOS Office photocopier leases, was attempting to win future additional leases with the SOS Office.
2. It was further part of the scheme that, on about July 16, 1991, defendant WARNER, representing he was an agent of the SOS Office, solicited Modern Business Systems, Inc. to make $2,000 per month payments to WARNER personally, in return for WARNER guaranteeing that Modern Business Systems, Inc. would be awarded additional business with the SOS Office. An official with Modern Business Systems, Inc. declined.

Awarding Real Property Leases To Warner-Controlled Entities

68. At times material to the indictment:

A. The SOS Office awarded leases of real property, including certain buildings owned by outside individuals and entities. The Physical Services Department was responsible for negotiating particular SOS Office real property leases and overseeing the maintenance and upkeep related to said leases.

B. The Property Management Division of the Drivers Services Department was responsible for negotiating leases at drivers license facilities and overseeing the maintenance and upkeep related to said leases.

17 N. State Lease

69. It was further part of the scheme that, in approximately early 1991, due to defendant RYAN providing defendant WARNER with participatory status in, and material non-public information relating to, governmental decisions, WARNER learned that the SOS Office was seeking to relocate certain of its administrative office facilities then located at 188 W. Randolph Street in Chicago.

1. It was further part of the scheme that, in approximately April 1991, defendant WARNER spoke with an individual associated with a building at 17 N. State Street in Chicago, Illinois (hereinafter “Property Manager 1").
2. It was further part of the scheme that, in or about April 1991, defendant WARNER caused a contract to be entered into with Property Manager 1, giving WARNER a 6% commission interest in any SOS Office lease relating to the 17 N. State Street building (hereinafter the “commission contract”).
3. It was further part of the scheme that defendant WARNER concealed his financial interest in the commission contract with Property Manager 1 by omitting his name from the commission contract and causing the commission contract to be executed by a third party, who had no involvement in facilitating a lease of the 17 N. State property.
4. It was further part of the scheme that, in or about mid-1991, defendant WARNER contacted an SOS Office employee responsible for identifying relocation sites for the operations then located at 188 W. Randolph (hereinafter “SOS Official F”), and directed SOS Official F to contact Property Manager 1. Understanding that WARNER was acting with defendant RYAN’s authority and unaware of WARNER’s interest in the commission contract, SOS Official F did as WARNER directed.

74. It was further part of the scheme that, on or about October 22, 1991, defendants RYAN and WARNER caused the SOS Office to enter a six-year lease for use and occupancy of the building at 17 N. State Street in Chicago (hereinafter “the 17 N. State Lease”). Thereafter, in or about early 1998, RYAN’s SOS Office agreed to renew the 17 N. State Lease for an additional six-year term, with WARNER receiving an additional 6% commission from Property Manager 1.

1. It was further part of the scheme that Fawell caused the “master list” to identify defendant WARNER as the “sponsor” for the 17 N. State Lease.
1. It was further part of the scheme that, between approximately October 1991 and at least October 2001, defendant WARNER received approximately $383,276 in commission payments related to the 17 N. State Lease and its renewal.
2. The Bellwood Lease
2. It was further part of the scheme that, in approximately 1992, due to defendant RYAN providing defendant WARNER with participatory status in, and material non-public information relating to, governmental decisions, WARNER learned that the SOS Office was seeking office space for certain operations of the SOS Office’s Department of Police.
3. It was further part of the scheme that, in or about early 1992, defendant WARNER contacted SOS Official E and advised SOS Official E that the SOS Office had identified a building at 405 N. Mannheim Road in Bellwood, Illinois, for potential use by the SOS Office’s Department of Police. WARNER further indicated that defendant RYAN would be contacting SOS Official E with the information.
4. It was further part of the scheme that, shortly thereafter, a secretary to defendant RYAN contacted SOS Official E and directed SOS Official E to consider the 405 N. Mannheim Road location for use by the SOS Office’s Department of Police.
5. It was further part of the scheme that, on or about October 15, 1992, for the purpose of leasing the property to the SOS Office and profiting therefrom, defendant WARNER obtained an ownership interest in the building at 405 N. Mannheim Road in Bellwood, Illinois, while concealing this interest through the use of a third party nominee.
6. It was further part of the scheme that defendant RYAN authorized the SOS Office to enter, on or about December 15, 1992, a five-year lease for use and occupancy of the building at 405 N. Mannheim Road in Bellwood (hereinafter “the Bellwood Lease”). In or about March 1998, RYAN authorized the renewal of the Bellwood Lease for another five-year term.
1. It was further part of the scheme that, between approximately December 1992 and March 2003, defendant WARNER received approximately $171,000 in proceeds related to the Bellwood Lease, a portion of which he applied toward a $95,000 loan related to Comguard.
2. The Joliet Lease
7. It was further part of the scheme that, in approximately early 1994, due to defendant RYAN providing defendant WARNER with participatory status in, and material non-public information relating to, governmental decisions, WARNER learned that the SOS Office was seeking office space in the Joliet area.
8. It was further part of the scheme that, in approximately early 1994, defendant RYAN instructed a high-ranking SOS Office official (hereinafter referred to “SOS Official G”) to contact defendant WARNER to help locate a building for the purpose of a new SOS Office lease.
9. It was further part of the scheme that SOS Official G did as defendant RYAN directed, and defendant WARNER arranged for and caused SOS Official G to inspect a building at 605 Maple Road in Joliet, Illinois.
10. It was further part of the scheme that, on or about October 31, 1994, for the purpose of leasing the property to the SOS Office and profiting therefrom, defendant WARNER obtained a substantial ownership interest in the building at 605 Maple Road in Joliet, Illinois, while concealing his ownership interest in the building through the use of a third party nominee.
11. It was further part of the scheme that defendant RYAN authorized the SOS Office to enter, on or about January 1, 1995, a four-year lease for use and occupancy of the building at 605 Maple Road in Joliet (hereinafter “the Joliet Lease”).
12. It was further part of the scheme that, beginning in approximately January 1995 and continuing to March 1999, defendant WARNER received approximately $387,500 in proceeds related to the Joliet Lease.

Awarding An SOS Office Lease to Associate 2

1. It was further part of the scheme that, beginning in or about 1993 and continuing to at least 2002, Associate 2 provided personal and financial benefits to defendant RYAN, including annual vacation-related benefits. In particular, RYAN received free lodging each year at the Jamaican vacation home of Associate 2 and, on at least two occasions, received free lodging at Associate 2's Palm Springs, California, home. Annually, Associate 2 provided RYAN between $1,000-2,000 in lodging benefits.
2. It was further part of the scheme that, beginning in or about 1994 and continuing to in or about 1998, Fawell also received free lodging at the Jamaican vacation home of Associate 2, and on at least two occasions, received free lodging at Associate 2's Palm Springs, California home. For each year from 1994-1998, Fawell received between $1,000-2,000 in lodging benefits from Associate 2.
3. It was further part of the scheme that, in or about early 1997, defendant RYAN, with Fawell’s assistance, took official action to benefit Associate 2. In particular, RYAN initiated contact with Associate 2 and proposed that the SOS Office lease a commercial building located in South Holland, Illinois, then principally vacant, which was owned by an entity controlled by Associate 2.
4. It was further part of the scheme that defendant RYAN instructed SOS Official D to contact Associate 2 and arrange an SOS Office lease of Associate 2's South Holland building (the “South Holland Lease”). In negotiating the South Holland Lease with Associate 2, SOS Official D reported directly to defendant RYAN and obtained direction from RYAN.
5. It was further part of the scheme that defendant RYAN and Fawell, working through SOS Official D and other SOS Office officials, approved the South Holland Lease. Defendant RYAN signed the lease documents, including approving terms and conditions that were not part of the standard SOS Office lease and which terms benefitted Associate 2.
6. It was further part of the scheme that, between approximately May 1997 and June 2002, pursuant to the lease defendant RYAN approved and signed, Associate 2 received approximately $600,000 in lease payments from the SOS Office, via the United States mails.
7. It was further part of the scheme to defraud that, from in or about 1993 to at least January 2002, in order to conceal the free lodging benefits defendant RYAN was receiving from Associate 2 and at RYAN’s urging, RYAN and Associate 2 repeatedly engaged in sham transactions, in which RYAN tendered a check to Associate 2 in the amount of the lodging benefit and Associate 2 provided back to RYAN amounts of cash equal to the amounts indicated on the checks tendered by and through RYAN.
8. It was further part of the scheme that, after August 26, 1997, and continuing through approximately January 2002, defendant RYAN and Fawell continued to receive lodging benefits from Associate 2 in violation of RYAN’s stated gift policy and in violation of the SOS Office policy directive described above in paragraph 2(J) of Count One.
9. It was further part of the scheme that defendant RYAN concealed the vacation benefits he had received from Associate 2 by, among other things, a) knowingly failing to disclose gifts and financial benefits he had received from Associate 2 as required by law and b) making false and misleading statements of material fact when interviewed in January 2000 about financial arrangements involving his vacations with Associate 2 by federal investigators conducting the Grand Jury Investigation.

Authorizing Official Acts Relating To Associate 1

98. It was further part of the scheme that, beginning no later than the mid-1990s and continuing to at least 2002, Associate 1 provided personal and financial benefits to and for the benefit of defendant RYAN. Such benefits included, without limitation, the following:

A. Monetary payments and gifts on multiple occasions to defendant RYAN which payments and gifts exceeded the $50 threshold;

B. Vacation benefits to defendant RYAN, including benefits associated with a 1995 trip to Cancun, Mexico; and

C. Gifts and personal service benefits to RYAN’s family members, including a $2,200 vacation benefit to a RYAN daughter’s family in 1999.

99. It was further part of the scheme that defendant RYAN concealed the personal and financial benefits he received from Associate 1, and Associate 1 concealed the personal and financial benefits he provided to RYAN.

100. It was further part of the scheme that defendant RYAN took official action to benefit Associate 1 relating to the following contracts and business opportunities:

Awarding SOS Office Leases To Clients Of Associate 1

101. It was further part of the scheme that, in 1995 and again in 1997, defendant RYAN authorized the SOS Office to enter into leases of Springfield, Illinois property, and Associate 1 received commissions for assisting in placing these leases with the SOS Office. Said commission payments to Associate 1 totalled over $38,000.

Awarding Grayville Prison To Associate 1 Client

102. At times material to this indictment:

A. In or about late 2000, the Governor’s Office, in conjunction with the Illinois Department of Corrections (hereinafter “IDOC”), commenced a site selection process for the purpose of identifying a specific geographic location for the construction of a maximum security prison to house prisoners in the custody of the IDOC.

B. In or about January 2001, the IDOC, with the knowledge and concurrence of the Governor’s Office, publicly announced three particular locations that had been selected as finalists for the site of the maximum security prison.

C. On or about February 23, 2001, at an internal meeting of high ranking officials of the Governor’s Office and the IDOC, defendant RYAN chose the town of Grayville, located in southeastern Illinois, to be the site for the maximum security prison from among the three finalists. Defendant RYAN’s February 23, 2001 internal decision was not then made public.

D. Prior to February 23, 2001, one or more high-ranking officials in the Governor’s Office had complained to defendant RYAN’s gubernatorial chief of staff that it was improper for Associate 1 to routinely participate and be present for the conducting of official government business in and around defendant RYAN’s governmental office.

103. It was further part of the scheme that, on or about February 23, 2001, due to defendant RYAN providing Associate 1 with participatory status in, and material non-public information relating to, governmental decisions, RYAN informed Associate 1 that RYAN had selected Grayville to be the recipient of the maximum security prison site. At the time RYAN provided Associate 1 the information regarding Grayville, an aide to RYAN reminded Associate 1 that Grayville’s selection was not public information.

104. It was further part of the scheme that, shortly after defendant RYAN informed Associate 1 of the Grayville selection, Associate 1 met with a representative of a business group affiliated with Grayville (hereinafter the “Grayville Representative”) and entered into an agreement to lobby for the selection of Grayville as the site for the proposed maximum security prison, in return for $50,000 in upfront lobbying fees.

105. It was further part of the scheme that, on or about March 12, 2001, Associate 1 received a $50,000 cashier’s check from the Grayville Representative as his lobbying fee. Associate 1 then deposited this check into a checking account that he controlled. During the two-month period thereafter, Associate 1 structured cash withdrawals from his bank account totaling approximately $35,000, such that no single withdrawal exceeded $10,000, the threshold level which would have triggered