Obama’s Northern Trust connections (Updated)

It has been assumed that Sen. Barack Obama (D-Ill.) had no prior relationship with Northern Trust until it became his mortgage banker for the June 2005 purchase of his Hyde Park townhouse.

It has been suggested that it was convicted political fixer Antoin “Tony” Rezko, Obama’s political patron and personal real estate fairy, who led him to Northern Trust.

Recently, it was pointed out that one of his early political backers, Lester Crown (photo), a board member at Northern Trust, may have been involved in Obama getting his $1.32 million loan.

However, in another revelation by pseudononymous writer Richard Henry Lee, posted July 7, 2008, at American Thinker, we learn that it may have been through Obama’s relationship with domestic terrorist and long-term Obama acquaintance, Weather Underground leader William Ayers that Obama first made the connection:

Barack Obama served on the board of directors of Woods Fund of Chicago from 1993 to 2001. During that time, the tax exempt foundation made some interesting grants, including one to Obama’s church, Trinity United Church of Christ, headed by Rev. Jeremiah Wright at the time. Grants were also made to ACORN, a left wing voter registration group and to a partnership for constructing low income housing. The fund also used Northern Trust for financial services, which is the same company that provided Obama his 2005 mortgage.

In 2001 the board of directors included Obama, William Ayers (photo), the former Weather Underground radical terrorist, and serving as chairman was Howard J. Stanback who headed New Kenwood LLC, a limited liability company founded by now-convicted felon Tony Rezko and Allison Davis, Obama’s former boss at the law firm of Davis Miner Barnhill & Galland.

Coincidentally, Woods Fund had started using Northern Trust investment services a couple of years earlier. The 2005 Woods Fund 990-PF tax filing shows that the fund paid $105,583 in fees and also participated in a Northern Trust private equity fund. Ayers and Stanback were still on the board of directors at that time so it is possible that one of them was somehow involved in helping Obama choose Northern Trust.

The Obama-Ayers connection has been presumed to be only that between Obama and William Ayers. However, there is a direct Obama-Ayers connection between Obama and Thomas G. Ayers (photo), father of William Ayers and the retired president and CEO of Commonwealth Edison, that predates the 2005 mortgage with Northern Trust.

According to the 2001 annual report of the Chicago Public Education Fund, Thomas Ayers and Barack Obama both served as members of the Fund’s Leadership Council.

Here it should be mentioned that until May 1994, when he had passed the Company’s mandatory retirement age of 75, and was therefore no longer up for re-election, Thomas G. Ayers served on the Finance Committee of the General Dynamics Corp. board of directors with Lester Crown, the largest share holder. It just so happens that Northern Trust was the trustee of the corporation’s Salaried Savings Plan and the Hourly Savings Plan overseen by the Committee.

Without question, both Tom Ayers and Lester Crown had long-standing relationships with Northern Trust and both of them had established relationships with Barack Obama that predated the 2005 loan from Northern Trust. Through William Ayers, Barack Obama had familiarity with Northern Trust dating from his time with the Woods Fund.

Which of these connections—or perhaps all of them combined—gave Sen. Obama the edge to acquire a $1.32 million mortgage when his financial history did not support it is unknown. At the very least, we do now know that Tony Rezko was not his only pathway to the world of high finance.

Update: It really is all in the Ayers family: “In addition to serving as the Annenberg Challenge’s first chairman, Obama served on the ‘Leadership Council’ of the Chicago Public Schools Education Fund, the Challenge’s successor organization. Obama served on this council alongside Ayers’s father, Thomas, and his brother, John, in 2001 and 2002, according to the Fund’s annual reports. Obama and John Ayers also served on the council in 2003 and 2004, according to the Fund’s annual reports. (Thomas Ayers, who died in 2007, had been CEO of Commonwealth Edison.)”

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More on the Ayers-Obama relationship is available in this April 22, 2008, article by Dr. Stephen Diamond, a law professor and a political scientist on the faculty of Santa Clara University School of Law in Santa Clara, California, who has written extensively on the subject at his Global Labor and the Global Economy blog.