Feds Probing Quinn's Embattled Anti-Violence Program

Updated 05/01/14 - 2:34 p.m.

CHICAGO (CBS) -- Federal prosecutors are looking into Gov. Quinn's embattled anti-violence program, CBS 2 has confirmed.

The U.S. Attorney's office in Springfield sought information about the Neighborhood Recovery Initiative from the Illinois State Comptroller's office, which handles the state's checkbook.

"We were contacted by the Dept of Justice. They made a request for information involving the Neighborhood Recovery Initiative. We forwarded that info along," Comptroller's office spokesman Brad Hahn said in an email. "The request was made by telephone on March 27."

The U.S. Attorney's office in Springfield said, "We cannot confirm or deny if there is an investigation."

Federal prosecutors are no strangers to the Illinois governor's office, having successfully prosecuted Quinn's two predecessors--George Ryan and Rod Blagojevich. While those cases were handled by the U.S. Attorney's office in Chicago, this request was made by federal prosecutors in Springfield.

The disclosure of a possible federal investigation could deal a election year blow to Quinn, who is locked in a tight race with Republican venture capitalist Bruce Rauner.

"This is a sad event that the people of Illinois have seen too many times. The people deserve better than to have yet another governor under federal investigation," Rauner said in an emailed statement Thursday afternoon.

WBBM Newsradio Political Editor Craig Dellimore reports Quinn spokeswoman Brooke Anderson said the governor's office supports any inquiry of the program, and the administration has zero tolerance for any mismanagement at any state agency.

Earlier this week, the governor pointed out he shut down the program in 2012.

"I identified problems myself," Quinn said Wednesday when asked about a Cook County probe of the program. "Our government saw that that particular program needed fundamental overhaul. We abolished the agency that was involved in it. We ended that particular program, and moved it in a different direction."

Thursday afternoon, Quinn's campaign sought to shift the spotlight to Rauner, questions about his former firm, Chicago-based GTCR.

"While there is no doubt that Governor Quinn inherited an ethical crisis from two corrupt governors in a row, everyone knows he has been cleaning up state government since the day he arrived and when a problem comes to light he works to immediately get to the bottom of the issue, root out any problems whenever they should arise, and create new reforms and safeguards," campaign spokeswoman Izabela Miltko said in an email. "In stark contrast, billionaire Chairman of GTCR Bruce Rauner bought hundreds of nursing homes across the country and saw the opportunity to make a buck by slashing the care of residents in a greedy attempt to turn a profit. The cost of this corporate corruption was human lives. Despite his nursing homes repeatedly victimizing vulnerable senior citizens Chairman billionaire Rauner dodged responsibility, pointed the finger at everyone else but himself, shamelessly fought the families of the victims in court, and continues to do so today."

State prosecutors also have begun looking into Quinn's anti-violence program. Earlier this week, the Quinn administration turned over hundreds of program documents to the Cook County State's Attorney's office, in response to a subpoena.

An audit released in February blasted the way the $54 million program was operated after Quinn launched the effort in October 2010, amid a close election fight against state Sen. Bill Brady. The initiative sought to reduce violence in two high-crime neighborhoods in Chicago by providing jobs for youths, parenting skills classes, school counseling, and assistance for ex-cons.

Illinois Auditor General William Holland issued a report in February, revealing NRI was so hastily organized and sloppily executed that auditors questioned 40 percent of the expenditures claimed by service providers.

The now-defunct Illinois Violence Prevention Authority, which ran the program, could not provide auditors with the criteria used to select the neighborhoods where the money went, instead of other communities considered more crime-ridden. The audit determined the program relied on advice from Chicago aldermen, not an open bidding process, to decide where to spend the money.

"IVPA failed to conduct its due diligence to document that the decisions related to the selection of lead agencies were free of any conflict of interest, the appearance of conflict of interest or that the agencies selected were the best entities to provide the needed services," Holland said in his report.

The IVPA since has been rolled into the Illinois Criminal Justice Information Authority, and a spokeswoman said it has a more rigorous process for awarding grants for its programs.

Two groups hired by the Neighborhood Recovery Initiative have since closed, and the IVPA could not account for how they spent nearly $675,000 in grant money. Due to sloppy or missing paperwork, auditors questioned a total of $1.8 million out of $4.4 million – or 40 percent – of the money doled out by the initiative.

Roosevelt University political scientist Paul Green says it isn't clear how damaging the news will be to the Quinn campaign over the long haul.

"It all depends on the kind of legs it has and how deep it goes, but in this moment, Christmas has come early for Mr. Rauner," he tells CBS 2's Mike Parker.