From The Chicago Sun-Times:

Ex-Ryan aide pleads guilty

April 19, 2002

BY TIM NOVAK AND STEVE WARMBIR STAFF REPORTERS

Gov. Ryan's former deputy campaign manager pleaded guilty Thursday to a single mail fraud charge, admitting he helped divert as much as $800,000 in state resources and employees to the governor's campaign so Ryan could have more campaign funds to spend on advertising.

The former campaign aide, Richard A. Juliano, said he took his orders from Scott R. Fawell, who was Ryan's top aide in the secretary of state's office as well as the campaign manager, and unidentified others in the governor's campaign. Juliano has agreed to testify against Fawell, who has maintained that he is innocent since being indicted with Juliano on corruption charges.

"I knowingly aided and abetted Scott Fawell to divert state resources to Citizens for Ryan,'' Juliano told U.S. District Court Judge Rebecca Pallmeyer.

Juliano admitted that Fawell gave him a $5,000-a-month-job in the secretary of state's office, but ordered him to work on Ryan's 1998 campaign for governor along with other state employees. When those employees worried about doing campaign work on state time, Juliano and Fawell worked to cover it up by having records falsified, according to Juliano's plea agreement.

"Fawell told Juliano that the campaign could not afford to incur such a large payroll expense, in that Citizens for Ryan needed to save money for its paid advertising campaign,'' the plea agreement states.

Juliano's attorney James Montana said his client "didn't do this on his own. He's very much under the thumb of Scott Fawell and others. He started working with Mr. Fawell when he was 20 years old. He was pretty young, impressionable and naive. It's not an excuse, it's a way to keep in perspective his conduct.''

Juliano pleaded guilty to mailing a check from the state treasury to a Springfield office supplier for an industrial paper shredder that could quickly turn documents into confetti. The shredder was sent to Ryan's campaign office.

Juliano, who ran President Bush's campaign in Illinois two years ago, faces five years in prison, a $250,000 fine and restitution. But under his plea agreement, he could get probation depending on how well he cooperates with the federal government's ongoing investigation of corruption in the secretary of state's office under Ryan, according to Assistant U.S. Attorney Patrick Collins.

Juliano, a graduate of the University of Chicago Law School, is a critical witness for the government. He was Fawell's right-hand man for many years, working both in the secretary of state's office and for Ryan's campaigns, often at the same time.

During 1995, Juliano at Fawell's request worked on the presidential campaign of U.S. Sen. Phil Gramm (R-Texas), who had been endorsed by Ryan. Fawell had arranged for himself, Juliano and Ryan's daughter, Lynda Fairman, to share in $30,000 in payments for "consulting'' work on the campaign fund, according to federal records and sources. Juliano did some of the consulting work on state time, according to his plea.

Ryan refused to comment Thursday, but his spokesman Dennis Culloton said, "The governor's conscience is clear.''

The governor issued a statement praising Juliano, who began working for Ryan in 1991. "Rich is a bright young man with a good heart, and I know he is doing what he believes is right,'' Ryan said. "I know this must be a terrible strain on him and his family . . ."

Juliano, a former resident of Park Ridge, lives with his wife and daughter is suburban Washington, D.C., where he was the White House liaison to the U.S. Department of Transportation, a job he got after working on Bush's campaign. Juliano quit late last month, a few days before he was named in the federal indictment accusing Fawell and the governor's campaign fund of racketeering charges.

Fawell's attorney, Edward Genson, declined to comment on the details in Juliano's plea agreement, saying he hadn't read it, but he continued to deny that Fawell did anything wrong.

"It was my understanding that Juliano, a fine young man, a gifted lawyer, did not violate the law. It's a shame that he didn't go to trial,'' Genson said. "Sometimes people get scared when they shouldn't."

Genson blasted Montana, a chief counsel under Gov. Jim Edgar, for placing blame on Fawell.

"I've never seen a defense attorney say, 'My client is guilty, but the co-defendant is more guilty,' '' Genson said.