Giannoulias’ Tax Windfall

Alexi Giannoulias spent much of the week fending off charges related to his ties to corrupt figures like Rod Blagojevich and felon Tony Rezko as well as dealing with the news that his family’s bank, Broadway Bank, stood on the brink of failure. On Friday, the Chicago Business Journal reported that the Giannoulias family stands to take away more than $10 million in federal tax refunds even if Broadway Bank does fail. Giannoulias himself predicted that the bank would fail earlier this week.

Specifically, the bank’s $75-million loss last year may potentially have created between $12 million and $15 million in tax benefits for candidate Giannoulias, along with his mother and two brothers. The journal also reports that this windfall would be the result of the fact that the Giannoulias family is the sole owner of a sub chapter S corporation that controls $1.2-billion-asset Broadway: they pay the bank’s income taxes… while also benefiting from the tax deductions that accompany its losses.

Giannoulias’ admitted role in his family bank’s calamitous expansion into real estate when he was serving as senior lender at Broadway in the years immediately before he was elected state treasurer in 2006 look bad enough by itself. The possibility that the bank might fail in part due to these actions mid-campaign is even worse. Giannoulias profiting from that failure? Whoa. Let’s just say that to the average voter, this doesn’t exactly look like the sort of record that you want your future senator to be touting.