Feds step in to save Obama crony's bank as Giannoulias heads for the White House

llinois Senate candidate and one-man corruption machine Alexi Giannoulias is furiously calling in favors to the feds. Giannoulias is a former creature of the Barack Obama-Rod Blagojevich-Tony Rezko Chicago cesspool. He's also the owner of Broadway Bank, which is currently failing miserably. Fortunately, Giannoulias knows how to get himself out of a sticky situation.

The family of Democratic U.S. Senate nominee Alexi Giannoulias stands to collect more than $10 million in federal tax refunds even if its Broadway Bank fails, which Mr. Giannoulias said this week is likely.

A $75-million loss at the struggling lender last year generated tax benefits potentially worth between $12 million and $15 million to Mr. Giannoulias, his two brothers and his mother. As the sole owners of a subchapter S corporation that controls $1.2-billion-asset Broadway, they pay the taxes on the bank’s income and reap tax deductions on its losses.

The possibility of family members pocketing millions in tax refunds as Broadway slides toward insolvency and federal receivership is likely to fuel more controversy for Mr. Giannoulias, who is already under fire for his role in the bank’s downfall. In an interview this week, he took some responsibility for a disastrous expansion of real estate lending when he was senior lender at Broadway in the mid-2000s, before winning election as Illinois treasurer in 2006.

If the Giannoulias family's shambles of a bank collapses, the millions in losses would be absorbed by the FDIC insurance fund, much of which could be passed on to taxpayers. Meanwhile the Giannouliases would walk away with $10 million in tax benefits, despite their mismanagement. It's a pretty sweet deal. Obama and Giannoulias are old friends and used to play basketball together, although with Giannoulias it's impossible to know where the money is coming from. He's done business with countless shady Chicago characters, including mobsters.

Meanwhile, Giannoulias will be slinking off to the White House to hopefully call in another favor.

Embattled Illinois Senate candidate Alexi Giannoulias -- an old Obama ally, but not his preferred candidate -- will be by the White House for Greek Independence Day tomorrow, and the local press has been asking the campaign what kind of welcome he'll receive.

I'm told he's likely to stop in and chat with political aides like Axelrod and Patrick Gaspard, part of a running effort to convince national Democrats not to write the race off.

So this Chicago corruption magnet somehow gets a sweetheart deal for his bank from the feds and now may get personal help for his Senate race from the White House.