Chicago Mayor Rahm Emanuel Continues Getting Cash From Firms Managing Chicago Pension Money

Chicago Mayor Rahm Emanuel carries a well-earned reputation as a man who's comfortable with controversy, someone who'd rather be powerful than loved. So it is with his handling of accusations that his campaign improperly accepted contributions from companies that manage city pension funds. Even as Emanuel confronts calls from local lawmakers for a federal probe, he has just accepted another infusion of cash from the same financial services firms whose contributions triggered the scrutiny.

Last week, Emanuel raked in more than a half-million dollars in campaign cash in a single day. Among the contributions were $100,000 from top executives at Madison Dearborn Partners and another $50,000 from John Buck, the principal of the John Buck Company. Those two firms currently manage Chicago pension money and their executives have previously made major campaign contributions to Emanuel, who appoints members of the boards overseeing pension investments. Emanuel, 55, is running for a second term in Chicago's municipal election in February.

Chicago lawmakers have asked the Securities and Exchange Commission to investigate possible violations of the agency’s “pay-to-play” rule, designed to prevent campaign contributions to public officials from executives at firms managing public pension money.

The lawmakers also asked the city’s inspector general to investigate whether the campaign contributions violated an executive order (signed by Emanuel himself) that bans campaign contributions to him from city contractors and subcontractors. That order says “it is necessary that public officials and contractors adhere to the highest ethical standards and avoid transactions and circumstances that may compromise or appear to compromise the independence of any City decision.”

A spokesperson for Emanuel's campaign said "the donations are fully compliant with the law and the higher standards the mayor voluntarily imposes on himself." A Madison Dearborn spokesperson previously told IBTimes that the firm “is in full compliance with all SEC rules and legislation.”

While the SEC this week told the lawmakers the agency will review their complaint, that hasn't stopped the money from flowing to Emanuel's campaign from firms managing city pension money, nor has it stopped Emanuel from trying to explicitly legalize the donations as the cash flows into his campaign.

Yesterday, a document surfaced from the Emanuel-appointed ethics commission showing the mayor's administration asserting that financial firms' business with city pension funds are exempt from the city's ethics law. The commission said its nonbinding interpretation effectively means Emanuel's donors should not have to comply with restrictions on campaign contributions that other city contractors must comply with.

Hours after that document surfaced, Emanuel touted his ethics record at a public forum.