Obama, Two Aides Questioned in Probe

By JONATHAN WEISMAN

Federal prosecutors investigating alleged corruption by Illinois Gov. Rod Blagojevich interviewed President-elect Barack Obama and two of his top advisers last week in connection with the case, according to a memo released Tuesday by the Obama transition team.

Rod Blagojevich

The five-page memo denies any wrongdoing or improper communication between the transition team and Mr. Blagojevich, who prosecutors allege sought to fill Mr. Obama's vacant Senate seat in exchange for money or a better job. Prosecutors have said no one on the Obama transition team is a suspect.

Mr. Obama had promised shortly after Mr. Blagojevich's Dec. 9 arrest to release an accounting of contacts between his staff and the governor's office. Federal agents had been wiretapping conversations by Mr. Blagojevich in October and November as part of their criminal investigation.

The memo released Tuesday said Mr. Obama's incoming White House chief of staff, Rahm Emanuel, contacted Mr. Blagojevich and his staff at least five times after Election Day, and produced a slate of suggested replacements for Mr. Obama's vacated Senate seat. Mr. Emanuel spoke about four times to Blagojevich chief of staff John Harris to discuss the Senate seat.

Neither Mr. Emanuel nor other Obama aides and confidants heard of Mr. Blagojevich's alleged efforts to auction the Senate appointment to the highest bidder, the report said.

Mr. Blagojevich was arrested on suspicion of using his authority as governor to wrest campaign donations and other favors in exchange for signing legislation into law. He has denied any wrongdoing.

Messrs. Obama and Emanuel, as well as top Obama aide Valerie Jarrett, were interviewed by U.S. Attorney Patrick Fitzgerald on Dec. 18, 19 and 20 -- an extraordinary outreach from law enforcement during a presidential transition. The interviews lasted two hours, and their lawyers were present.

The Obama audit of contacts between aides and Mr. Blagojevich's staff revealed considerably more discussions between the two camps than previously divulged, and it described an apparently concerted effort by the governor to crack the Obama circle.

Union Role

One effort apparently involved the head of the Service Employees International Union in Illinois, Tom Balanoff. He approached Ms. Jarrett and related the governor's desire to be named Health and Human Services secretary while also mentioning the governor was considering her for the Senate seat, according to the Obama memo. Mr. Balanoff didn't say Mr. Blagojevich was linking the two, the memo said.

"Ms. Jarrett viewed that as a ridiculous proposition and waved it off," said Gregory B. Craig, Mr. Obama's choice for White House counsel, who led the audit and wrote the memo. He spoke to reporters in a conference call Tuesday.

In another instance, a deputy Illinois governor approached one of Mr. Obama's best friends, Eric Whitaker, to talk about the Senate seat, the memo said. Mr. Craig said at no point did it become clear those approaches were intended to open negotiations over the seat. "If [the governor] was actively seeking a response from the president-elect's people, he was not overt or explicit about that in any way, shape, or form," Mr. Craig said.

The Obama memo was issued as the president-elect vacationed in Hawaii, and Mr. Emanuel began a holiday trip to Africa. Obama aides said the timing of the release was dictated by Mr. Fitzgerald, who had requested a delay related to the investigation. Mr. Craig said he was ready to release his audit on Dec. 15 but was asked to wait until Christmas week.

Republican National Committee spokesman Alex Conant urged Mr. Obama to release internal documents and emails to back up the audit's findings.

"While Obama certainly deserves some credit for releasing his team's contacts with Gov. Blagojevich, it remains unfortunate he acted only after political pressure was exerted," Mr. Conant said in a statement. "Hopefully, President-elect Obama's promises of transparency related to this matter will extend to all communications, including written."

The report's conclusions are based on the recollections of Obama aides, not on federal wiretap recordings of Mr. Blagojevich, his aides and his advisers, which make up the heart of the federal arrest affidavit, Mr. Craig said. He said the law-enforcement tapes weren't available to the legal staff that canvassed the Obama team.

By his recollections, Mr. Emanuel had one or two phone conversations with Mr. Blagojevich between Nov. 6 and Nov. 8, as Mr. Emanuel was deliberating whether to resign his House seat, representing Chicago's North Side. Soon after, Mr. Emanuel called the Illinois governor again to say he would leave Congress to take a White House post. The conversation included talk about the merits of candidates for the Senate seat, especially those of Ms. Jarrett, whom Mr. Emanuel believed the president-elect favored, according to the memo.

The two men didn't discuss any potential appointment for Mr. Blagojevich -- either to the cabinet, a political nonprofit organization or "any other personal benefit for the governor," according to the memo. The federal arrest affidavit alleged the governor had talked about such a trade with his aides and advisers.

In subsequent conversations with Mr. Harris -- after Ms. Jarrett took herself out of the running to take a White House job -- Mr. Emanuel produced a slate of favored candidates with the president-elect's authorization. The names included Illinois Comptroller Dan Hynes, Iraq war veteran Tammy Duckworth, Rep. Jan Schakowsky and Rep. Jesse Jackson Jr.

In later telephone conversations, Mr. Emanuel added Illinois Attorney General Lisa Madigan and Chicago Urban League President Cheryle Jackson.

Meanwhile, on Nov. 7, the SEIU's Mr. Balanoff told Ms. Jarrett he had spoken with the governor about her possible selection for the Senate. Then he said Mr. Blagojevich had raised the possibility of an appointment as Health and Human Services secretary.

"Ms. Jarrett did not understand the conversation to suggest that the governor wanted the cabinet seat as a quid pro quo," the memo said.

Reaching Out

In another approach, Illinois Deputy Governor Louanner Peters called Mr. Whitaker, Mr. Obama's close friend, shortly after the election. He said that Mr. Blagojevich was hearing from people about candidates they wanted to take Mr. Obama's Senate seat, according to the memo. She then asked Mr. Whitaker who could speak on Mr. Obama's behalf. Mr. Whitaker spoke with the president-elect, who said no one was authorized to discuss the issue, the memo said.

Mr. Emanuel's spokeswoman said he couldn't be reached for comment because he was traveling. Ms. Jarrett said in an email that Mr. Craig "answered everything completely." Mr. Whitaker couldn't be reached.

The Blagojevich controversy has been an early test for the incoming Obama administration, which has promised to be the most transparent in history.

Obama aides have accused news reporters of unfairly insinuating wrongdoing despite Mr. Fitzgerald's assurances that the president-elect and his staff were not suspects.

Critics have said the Obama team fumbled the issue and allowed those insinuations to ripen by not being forthcoming.

Republican and Democratic lawyers have said Mr. Fitzgerald had no legal authority to keep Mr. Obama from speaking out earlier.

The federal affidavit made clear that Obama aides would not participate in Mr. Blagojevich's alleged schemes to sell the Senate seat.

—Cam Simpson and David Kesmodel contributed to this article.

Write to Jonathan Weisman at jonathan.weisman@wsj.com

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