Former mayoral adviser Clarence McClain used his influence to halt temporarily the awarding of a city contract to Datacom Services Corp. in late 1984 while working on behalf of a rival company, according to a source close to the federal investigation of suspected corruption in Chicago government.
McClain engineered the interruption in the contracting process with the help of an unnamed, high-ranking official inside the Washington administration more than a year after leaving the administration under fire, the source said. At the time of the delay, McClain was working as a private consultant with Michael Raymond, who was posing as a corrupt representative of Systematic Recovery Service Inc., a competitor of Datacom, the source said.
It was disclosed last month that Raymond was working as an undercover informant for the FBI trying to buy influence with city officials.
In mid-December of 1984, McClain`s role in the process was relayed to William Ware, then the mayor`s chief of staff, according to the source.
Ware, who had been at odds with McClain in the past, reacted angrily to the ousted adviser`s involvement and ultimately helped push through the contract with Datacom against McClain`s objections, the source said.
The disclosure that Ware, who was Mayor Harold Washington`s closest adviser, knew of McClain`s involvement with Systematic Recovery in December, 1984, appears to be at odds with the version of events offered recently by the mayor.
Washington has said that administration officials did not link McClain to Systematic Recovery until a year later, when the FBI investigation was publicized last month. The officials said this to justify their decision not to immediately fire Deputy Revenue Director John E. Adams, who had reported receiving $10,000 from McClain. The officials said they would have dismissed Adams had they known that the money was connected to Systematic Recovery`s efforts to win city business.
Efforts to reach McClain for comment Monday were unsuccessful. Asked to comment on allegations that McClain tried to influence the contracting process, Alton Miller, the mayor`s press secretary, said, ”We would welcome any information that would assist us in any investigation of possible wrongdoing by any city official.” Corporation Counsel James Montgomery did not return telephone calls from a reporter.
Ira J. Edelson, the mayor`s top financial adviser, has provided federal prosecutors with an account of McClain`s involvement as part of the federal investigation into the City Hall contracting process.
Edelson, who has declined to talk with reporters, is regarded by prosecutors as a potentially key witness. His attorney, Robert Stephenson, has said Edelson is cooperating fully with the investigation and has been told by prosecutors that he is not a target.
Three city officials have been fired as a result of publicity surrounding the FBI`s 18-month undercover investigation. Three aldermen aligned with the mayor have acknowledged receiving payments from Raymond, though they describe the money as campaign and charitable contributions.
McClain has been a central but shadowy figure in the investigation and has said through his attorney, Julius L. Echoles, that he would invoke his 5th Amendment rights if called to testify before a federal grand jury.
He was pressured into quitting his $69,001-a-year job as one of the mayor`s top advisers in 1983 after it was disclosed that he did not pay property taxes and had three misdemeanor vice convictions dating back to 1965. But Washington praised McClain when he resigned, and rumors persisted that McClain remained an influential figure behind the scenes at City Hall.
Sources familiar with the federal investigation of the city contracting process said McClain was one of the first people contacted by Raymond when he came to Chicago in early 1984.
Raymond represented Systematic Recovery, a New York firm trying to win city contracts. Sources have said McClain promised Raymond that he could help him because he had clout in City Hall.
In making the latest disclosure about McClain, the source said that in the fall of 1984, the city was on the verge of awarding to Datacom a lucrative contract to collect millions of dollars in overdue parking fines when McClain intervened.
Edelson, who was then the city`s unpaid, acting director of the Revenue Department, had approved a contract with Datacom in September and submitted it to the city corporation counsel`s office for review, the source said.
In October, an assistant corporation counsel began negotiations with Datacom in hopes of getting more money for the city, the source said.
About the same time, Edelson received a call from a high-ranking administration official who said he should talk to McClain about the contract with Datacom, the source said.
”Edelson was suddenly told that McClain has problems with the contract,” the source said.
The source declined to identify the administration official who made the telephone call. But the source said the caller was not Washington or Ware.
Edelson was surprised at the involvement of a private citizen in a city contract, according to the source, but he contacted McClain anyway.
McClain told Edelson to hold off on awarding the contract to Datacom because there was going to be a report coming out that would embarrass the mayor if Datacom got the contract, the source said.
When Edelson pressed him for the report, McClain said Systematic Recovery officials in New York had it, the source said.
Edelson said he was going to New York on business for his accounting firm and he would meet with Systematic Recovery officials then, the source said. McClain offered to set up the meeting and did so, the source said.
When Edelson arrived at the collection company`s offices in New York, he was surprised to find that McClain was there with Raymond and Bernard Sandow, the firm`s president, the source said.
The Systematic Recovery representatives did not have the report, but they had two or three pages of what they said was the beginning of the report that would be critical of Datacom`s performance around the country, the source said. They also gave Edelson the name of a New York official who they said would be critical of Datacom, according to the source.
During the meeting, McClain insisted that the contract not be awarded to Datacom, and Sandow suggested for the first time that the contract should be split between the two firms, the source said.
Edelson does not recall the name of the New York official, but he said he called him and the official had kind words for Datacom and Systematic Recovery, the source said.
Edelson returned to Chicago somewhat angered and puzzled by McClain`s role in the process and related his feelings to Ware, according to the source. Ware had been a strong critic of McClain`s within the administration, frequently expressing fears that he would embarrass the mayor, sources have said.
When told of McClain`s role in the parking contract, ”Ware went off the wall,” the source said.
Edelson said in an interview with The Tribune on Dec. 28 that he had felt from the beginning that Datacom was the most qualified firm to handle the parking collection contract.
According to the source, Ware had been a strong supporter of Datacom from the start for the same reason, and the two officials decided to push hard to get the contract through regardless of McClain`s opposition. Ware died in May, 1985.
In January, 1985, Edelson signed the Datacom contract as it had been revised by the corporation counsel`s office to help the city. He sent it to the city`s Purchasing Department, which approved the contract and Washington ultimately signed it in late February.
McClain and Raymond, however, continued their efforts to discredit Datacom and obtain more business for Systematic Recovery, which has a contract with the city to collect delinquent water bills.
