To subscribe to Capitol Fax, click here. Oppo dump! Monday, Jun 5, 2017 * Politico… The AFL-CIO may call on members to take an endorsement vote in the Democratic gubernatorial primary on Tuesday… After we reported last month that the AFL-CIO was poised to back J.B. Pritzker, the billionaire was hit with a series of negative reports, including revelations that he had taken property tax reductions on his Chicago mansion and, most recently, that he had asked imprisoned Gov. Rod Blagojevich in 2008 to name him to a state post. Given these revelations, we asked around whether key backers were nervous. The answer we received was a resounding “no.” Pritzker invested heavily in opposition research on himself before he launched his bid for governor and he and top supporters had an idea of what could be coming at him, according to one high-ranking Illinois Democrat. So will the AFL-CIO back Pritzker? On Sunday, the Tribune’s Rick Pearson reported that SEIU’s Tom Balanoff called for the AFL-CIO to remain neutral in the primary. However, one of our sources remained confident of the AFL-CIO backing regardless, putting it this way: With all the intensity and pressure wrapped up with endorsing in June for a 2018 election, a union leader isn’t going to call a member vote for Pritzker — unless he has the votes for Pritzker. As of now, two sources tell us the vote is Tuesday. * JB Pritzker is the gift that keeps on giving for opposition researchers and reporters. Just click here for a taste of what the ILGOP has already made public about Pritzkter’s ties to Rod Blagojevich. Here’s one of them… Patti Blagojevich met with J.B., looking for job, just as Rod Blagojevich was trying to sell Illinois’ US Senate Seat.

The Chicago Sun-Times reported, “On Oct. 6, Blagojevich met with officials of the Pritzker Family Foundation, which has $65 million in assets. Among those at the meeting was foundation president J.B. Pritzker, one of several candidates the Chicago-Sun Times has reported the governor was considering to fill President-elect Barack Obama’s seat in the U.S. Senate.” As you also already know, the following month Pritzker’s conversations with Blagojevich were caught on FBI surveillance. Some of those conversations have already been divulged by the Tribune. Pritzker was also scheduled to have breakfast with Blagojevich on September 2nd, according to the Associated Press. * There’s also the issue of his sister’s bank… Superior was one of the first banks in the 1990s to turn to the emerging practice of subprime lending, where loans are targeted to high-risk borrowers at higher interest rates. Recipients of those loans often have loan delinquency or default histories, bankruptcies or limited debt experience, and by the middle of this decade, they began defaulting on their new mortgages. A dramatic rise in those defaults and foreclosures is blamed, in part, for the recent financial crisis. * And then there’s the Pritzker family’s enthusiastic use of offshore trusts to lower their tax liabilities… While many wealthy families go to great lengths to avoid taxes, the Pritzker family (most famous for it’s ownership of the Hyatt hotel chain) is unique in its role as “pioneers” in the use of offshore tax shelters. Many of its existing offshore trusts were set up as long as five decades ago, and some have allowed the family to continue benefitting from tax loopholes that have long since been closed. As the graphic below from a 2003 Forbes story details, one of the primary ways the Pritzker family uses offshore trusts to avoid taxes is by having income from their businesses funneled into offshore trusts. Those trusts then pay debt service to a bank, owned by the family trust, that loans that money right back to the business. The upshot is that all the taxable profits disappear and the family wealth accumulates unabated. A more recent Forbes article looking at the Pritzker family fortune notes that these trusts were not at the margin but rather “played a substantial role in the growth of the Pritzker fortune.” The same article notes that this fortune makes up the vast majority of [Penny] Pritzker’s $1.85 billion empire and has allowed 10 members of the Pritzker family to earn a spot on the list of Forbes 400 richest people in America. * More… The I.R.S. called the trusts sham and insisted that the Pritzkers owed the government $53.2 million in taxes. In 1994, however, the government settled with the family, which paid a mere $9.5 million plus interest. At the time, the I.R.S. had been unable to discover exactly how much was in the trusts—the family had made sure they were protected from outside scrutiny. * More… Their wealth is almost incalculable, because according to Forbes magazine, they are the only family in America to have off shore tax-free trusts because they were grandfathered in. Their off shore trust can ship money back to their family tax-free. It was grandfathered in because their grandfather got it through Congress – he was smart to see the future and got it done. Congress closed the loophole and grandfathered him in. Forbes magazine wrote about the Pritzker’s off shore trust, they emphasized that there are over 1000 separate trusts. One only knows what that road will eventually lead to. * And, of course, there’s the scandal which erupted when Pritzker’s young cousin Liesel sued the family for a billion dollars… The first hint of trouble came last November [in 2002]. Just before Thanksgiving, Robert’s 19-year-old daughter, and Jay’s niece, Liesel Pritzker—a Columbia College freshman and an actress who starred alongside Harrison Ford as the president’s daughter in the 1997 movie Air Force One and who is currently appearing in the Broadway play Vincent in Brixton—filed a lawsuit in Chicago against her father and all the Pritzker cousins. Setting off an explosion of publicity, she accused her family of looting her trust funds and those of her 20-year-old brother, Matthew, in a way that was “so heinous, obnoxious and offensive as to constitute a fraud.” The amount of money which Liesel claimed was taken from her was staggering—$1 billion—and she not only demanded it be returned, but asked the court to award her $5 billion in punitive damages. It was a stunning lawsuit, not just because of the money involved, but also for the questions it raised about the Pritzkers. Emphasis added because that could be a heckuva TV ad. The lawsuit was eventually settled. I found all that stuff - and more - after just a couple of hours idly surfing the Internet one recent Saturday morning. Just imagine what a determined opposition researcher with a hefty budget could find. - Posted by Rich Miller

43 Comments Sorry, comments for this post are now closed.

