Illinois governor's former aides indicted

CHICAGO, Illinois (CNN) -- Two former aides to Illinois Gov. George Ryan were indicted and federal prosecutors branded Ryan's campaign committee a "criminal enterprise" Tuesday as part of a long-running corruption probe.

Scott Fawell, Ryan's former campaign manager, and former campaign aide Richard Juliano were named in the indictment along with Citizens For George Ryan Sr., the governor's 28-year-old fundraising committee.

"For a period spanning seven years, Citizens for Ryan conducted itself as a criminal enterprise; today the grand jury returned an indictment so charging," U.S. Attorney Patrick Fitzgerald announced in a written statement.

The indictment states that employees in the secretary of state's office -- the post Ryan held before his election as governor in 1998 -- worked on his campaign on state time and state business was performed in return for campaign benefits.

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Prosecutors say promotions and benefits were doled out to employees based on their campaign work, and investigations into corruption allegations were cut short. Some investigators were fired under the guise of budget cutbacks, Fitzgerald said.

Ryan, a 68-year-old Republican, was not named in the indictment. He has previously announced he would not seek re-election this fall. His spokesman, Dennis Culloton, said Tuesday that Ryan would comment himself "at an appropriate time."

"There's no question that today's charges have been the subject of rumor and gossip for some time now, and this investigation has been ongoing for four years," Culloton said. "These cases are now in court where they belong."

Culloton said the passage of a state budget, not the lengthy corruption probe, was Ryan's main concern.

"The governor is not going to be distracted by all this. His focus is going to be on the job at hand. There have

been people nipping and chafing and harping at him ever since he took office," he said.

Fawell, 44, was charged with racketeering; mail fraud; conspiracy to obstruct justice; theft of government funds; perjury; and filing false tax returns. Juliano, 34, was accused of one count of mail fraud: He recently resigned a top position with the U.S. Transportation Department, will plead guilty and cooperate with the ongoing investigation, the U.S. attorney's office announced.

The indictment announced Tuesday accuses the three defendants -- Fawell, Juliano and the Ryan campaign committee -- of 20 acts of mail fraud, bribery and obstruction of justice. It seeks the forfeiture of "at least" $1 million from three bank accounts maintained by Citizens for Ryan, the campaign committee.

Fitzgerald said the activity spanned from 1992 to October 1999, and involved diverting "the personnel and resources of the secretary of state's office to Citizens for Ryan to benefit the campaign" and other campaigns the committee supported. Those included Illinois House races in 1996, the GOP presidential primary in 1996 and a state senate campaign in 1994.

Fitzgerald said the "illegal activity" involved both Ryan's campaign committee in 1994 -- when he successfully sought re-election as secretary of state -- and his campaign committee in 1998, when he ran for and won the governor's office.

"In short, the message sent today is that tax dollars are not free money," Fitzgerald said. "They belong to the taxpayers."