September 29th, 2010
10:47 AM ET
12 years ago

Giannoulias facing new questions about role in family bank

(CNN) - Illinois Senate candidate Alexi Giannoulias is maintaining he did not mislead voters about the duration of his tenure at his family's now-defunct Chicago bank, following a report that the Democrat worked for the troubled financial institution longer than he has claimed.

Giannoulias has long insisted that in 2005 he left his senior position at Broadway Bank, which collapsed earlier this year as a result of its troubled loan business. Giannoulias, himself a former loan officer there, has largely sought to avoid culpability for the firm's collapse by arguing he left the bank before its troubled deals were struck.

But, according to Wednesday's Chicago Tribune, Giannoulias' IRS returns last year show the Democrat was permitted to take a $2.7 million deduction as a result of working at least 500 hours for the bank in 2006 – contradicting his repeated claim he had washed his hands of the troubled family business months earlier.

Such a deduction is permitted by the IRS in order to reflect business losses tied to a family corporation if a taxpayer has spent a significant amount of time working for the business.

"The Chicago Tribune article makes very clear that Alexi has been consistent about his role at the bank," Giannoulias spokesman Scott Burnham told CNN.

"First, Alexi paid his taxes properly. Second, Alexi stopped taking new clients when he announced for (state) treasurer in 2005 and left the bank entirely in 2006."

In an interview with the Tribune, Giannoulias maintained he left his "day-to-day" job at the bank in 2005, saying his work in the first half of 2006 consisted of logging 30 hours a week to wind down his previous accounts.

"I think the biggest difference is I wasn't taking on new customers. I was just finishing up what I needed to do, so I don't know how the hours worked out, but it wasn't a full-time job," he said.

The timing question could nevertheless be particularly troublesome for Giannoulias. Among other things, Rep. Mark Kirk, the GOP Senate nominee, has repeatedly criticized Giannoulias over a loan Broadway made in February 2006 to Tony Rezko, a local developer convicted on fraud and bribery charges in 2008.

Rezko gained notoriety during the 2008 presidential primaries when Hillary Clinton attacked Barack Obama for various alleged associations with the developer.

Giannoulias maintains he had nothing to do with Broadway's Rezko loan despite still being employed by the bank when the deal was made.

It remains to be seen whether the new questions regarding Giannoulias' tenure at Broadway will hurt the Democrat's campaign for Obama's old Senate seat. Giannoulias remains locked in a tight race with Kirk despite Illinois' increasingly Democratic tilt.

Throughout his campaign, Giannoulias has been forced to repeatedly fend off allegations and concerns about his involvement with the bank, which was seized by regulators in April after failing to raise $85 million in necessary capital.

Giannoulias said then that his family's bank had fallen victim to an "economic tsunami."

"Unlike some larger financial firms, there was no bailout for my father's bank," he said.

Filed under: 2010 • Alexi Giannoulias
soundoff (10 Responses)
  1. gt

    he is a crook .... why would you dont vote him...

    September 29, 2010 10:54 am at 10:54 am |
  2. Dennis

    Image that, a Chicago politician with questionable financial dealings.

    September 29, 2010 11:01 am at 11:01 am |
  3. guarg

    And gloria steinem came to chicago last week and told female democrats that he is more honest to women than the republican candidate.

    Sure he is.

    September 29, 2010 11:11 am at 11:11 am |
  4. Claudia, Houston, Tx

    John McCain's son is guilty of leaving Silver Bank of Arizona a month before it went defunct and left investors high and dry. Bank of America stepped in and took Silver Bank investors and we the taxpayers bailed out Bank of America. Giannoulias family bank wasn't bailed out by taxpayers.

    September 29, 2010 11:14 am at 11:14 am |
  5. A True Centrist

    Giannoulias is as shady as they come...he'd fit in perfectly in Washington.

    September 29, 2010 11:17 am at 11:17 am |
  6. Whatever

    Hmmm I don't care what party you belong to... IF YOU CANNOT KEEP YOUR PERSONAL FINANCES IN SHAPE – – WHY DO YOU THINK "WE, THE PEOPLE", WILL WANT YOU IN THE SENATE OR CONGRESS DECIDING ON THE COUNTRY'S FINANCES?!?! Oh yeah, I almost forgot... the lobbyists will "pay" you so that is where your loyalities lie!!!!!

    September 29, 2010 11:33 am at 11:33 am |
  7. seebofubar

    Here in Illinois, we know what kind of a rat this creep is. Not only did he mis-manage the bank and loan money to the mob, he lost millions of dollars that belonged to parents saving money for their children's education by mis-managing the Bright Start program when he was the treasurer. This guy is scum.

    September 29, 2010 11:44 am at 11:44 am |
  8. 35 Days until Socialism dies in the United States

    Ran a bank into the ground and now wants to run the country into the ground as an Obozo rubberstamp. What a great country!

    September 29, 2010 11:55 am at 11:55 am |
  9. Cheney and Armey are a couple of Dicks

    Giannoulias received money in 2006 from the bank that failed in 2009. Kirk has lied about his service, bills he sponsored, and is a now fiscal conservative who promises to eliminate social programs, like social security, medicare and the VA.

    September 29, 2010 12:02 pm at 12:02 pm |
  10. ConstitutionalPatriot

    Him and Kirk are absolutely worthless establishment pawns. Check out Randy Stufflebeam of the Constitution party. Hopefully he will be on the ballot when the courts rule, but thanks to Mr. Kirk he may not. Kirk's legal staff abused the system by repeatedly raising objections to valid signatures that were necessary to get Randy on the ballot because they knew if they stalled long enough the ballots would be printed and Randy would be screwed. We had the signatures Kirk, we had 10,000 more than we needed, and you played games to screw Illinois out of a real choice. I can't vote for either of these guys in good conscience, so hopefully Randy gets on the ballot somehow!

    September 29, 2010 12:06 pm at 12:06 pm |