Former state Rep. Luis Arroyo pleaded guilty Wednesday in a bribery scheme involving a shadowy lobbying effort to expand the use of sweepstakes gaming machines that also led to criminal charges against the son-in-law of onetime Cook County Democratic boss Joseph Berrios.
Arroyo, 67, who resigned soon after he was charged with bribery in October 2019, changed his plea during a telephone hearing before U.S. District Judge Steven Seeger. Sentencing was set for Feb. 18.
The former Democratic legislator from Chicago made what is known as a blind plea to one count alleging he deprived the public of his honest services through the bribery scheme, a move in which he admits guilt without an agreement as to the length of sentence.
The maximum penalty could be 20 years in prison, a $250,000 fine and three years of supervised release after prison, but his lawyers and prosecutors can make their own recommendations for the judge to consider for sentencing. The government is also seeking forfeiture from Arroyo of up to $32,500, an amount contested by the defendant.
When Seeger asked the condition of Arroyo’s health, he said: “Pretty healthy. So far, so good.”
And when Seeger asked how he would plead, Arroyo said: “I plead guilty, judge.”
At the conclusion of the hearing, Arroyo said: “I appreciate you, judge. Thank you very much, and have a great day.”
A superseding indictment filed last year added new wire and mail fraud charges against Arroyo and also charged James Weiss with bribery, wire fraud, mail fraud and lying to the FBI. Weiss, who is married to Berrios’ daughter, former state Rep. Toni Berrios, has pleaded not guilty.
The case centers on the largely uncharted world of sweepstakes machines, sometimes called “gray machines,” which allow customers to put in money, receive a coupon to redeem for merchandise online and then play electronic games such as slot machines.
Since the machines can be played for free, they are not considered gambling devices. Critics, however, contend the unregulated devices, which operate in cities like Chicago that have banned video gambling, are designed to skirt the law.
According to the 15-page indictment, Weiss paid bribes to Arroyo beginning in November 2018 in exchange for Arroyo’s promotion of legislation beneficial to Weiss’ company, Collage LLC, which specialized in the sweepstakes machines.
The bribes were paid via off-the-books lobbying payments through Collage to Arroyo’s consulting firm, Spartacus 3 LLC, which Arroyo failed to report to state regulators, according to the charges. Prosecutors alleged Wednesday those payments totaled at least $7,500.
In exchange, Arroyo agreed to vote for sweepstakes legislation and promote it with other lawmakers and unidentified officials in the executive branch of government. He also spoke in favor of the bill during hearings before the House.
Both Weiss and Arroyo also conspired in 2019 to pay a state senator $2,500 a month in kickbacks in exchange for the senator’s support on the proposed sweepstakes game legislation, the indictment alleged.
In Wednesday’s hearing, Assistant U.S. Attorney James Durkin said the senator was to receive the $2,500-a-month payments in exchange for his sponsorship, votes for and promotion of the sweepstakes legislation.
The senator was not named in court documents, but the Chicago Tribune reported he is Terry Link, a Vernon Hills Democrat who resigned from office before pleading guilty to unrelated tax evasion charges in September 2020.
Weiss’ involvement in the bribery probe was first reported by the Tribune after the FBI raided Weiss’ business offices. He declined to comment on his role in the investigation at the time, telling a reporter outside his River Grove home that agents had seized his cellphone.
Weiss’ lawyer revealed in a recent court filing that the FBI had indeed pulled Weiss over as he drove in nearby Maywood two days before Arroyo was arrested and had taken his phone.
The filing alleged agents interrogated Weiss about the case for more than an hour without telling him he was free to go, then tricked him into giving them his pass code for the phone.
The indictment alleged Weiss lied to agents during the interview about whether he knew the money was going to the senator.
According to prosecutors, the unnamed state senator had told the FBI that Arroyo approached him about “the passage of sweepstakes-related legislation” during the House’s 2019 spring session. At the time, the senator was cooperating with authorities in the hopes he’d get a break on expected tax-related charges.
In early August 2019, Arroyo texted the senator asking to meet at a restaurant in Highland Park. Also at the meeting was Weiss as well as one of Weiss’ associates, prosecutors alleged.
During the meeting, Arroyo said he was going to introduce a “trailer bill” in the veto session expanding the use of sweepstakes games and offered to make periodic payments to the senator in exchange for his support, according to the criminal complaint filed against Arroyo in 2019.
Weiss told the group he would forward a draft of the proposed legislation that the senator could look over, according to the complaint.
“I would like for you to carry the bill,” Arroyo allegedly told the senator. “I don’t have nobody in the Senate.”
Arroyo and the state senator then allegedly stepped outside the restaurant and the senator asked, “What’s in it for me, though?”
Arroyo said, “I’m a paid consultant, OK. You put a price on it. I mean, if you want to get paid, you want someone else to get a check monthly, a monthly stipend, we could put them on the contract. We could put you on a contract. You tell me what it is. Tell me what you need,” according to a statement prosecutors outlined in court.
When the senator said he was in the “twilight” of his career, Arroyo said: “If I’m doing OK, you’re going to do OK,” adding they could “make sure you are rewarded for what you do,” according to the statement read in court.
Three weeks later, the senator was wearing an FBI wire when Arroyo allegedly delivered the first of the promised $2,500 checks — signed by Weiss and drawn on the Collage account — and a copy of the legislation at a restaurant in Skokie, prosecutors have alleged.
“This is, this is the jackpot,” Arroyo allegedly told the senator as he handed over the money. Additional monthly $2,500 payments were expected to be made over the next six to 12 months, federal authorities alleged.
As outlined in court Wednesday, Arroyo said to the senator: “We’re going to write you a check per month, six months to a year. What do you prefer?” And the senator said: “Whatever, a year sounds great.”
The complaint alleged Weiss later emailed the state senator a note of thanks.
“I appreciate your help and assistance,” Weiss allegedly wrote. “I know there are challenges in front of me with sweepstakes. Please let me know if there is anyone else you would recommend I meet with and share information.”
Along the way, Arroyo and Weiss allegedly prepared a sham contract between Collage and the senator to conceal the $2,500 monthly bribes.
Weiss mailed a final $2,500 check to the senator on Oct. 22, 2019, two days before agents interviewed him in Maywood, according to the indictment.
When Arroyo resigned, he had been in office since 2006 and was an assistant majority leader under then-House Speaker Michael Madigan, D-Chicago.
Arroyo’s annual salary was $80,037, including a leadership stipend of $10,573, and he was set to receive pension payments of $3,950 a month, a benefit in jeopardy as state officials review developments in the case.
When first charged two years ago, Arroyo resigned his Illinois House seat under pressure from Madigan.
Madigan later would be implicated in the ComEd scheme in which the company agreed to pay a $200 million fine and cooperate in a federal probe in which the company admitted to giving jobs to the speaker’s allies in hopes that he would look favorably upon the utility company’s Springfield agenda.
Madigan, still Democratic committeeman of the 13th Ward, has not been charged with a crime and has denied wrongdoing