Part 2 – IBM & Honeywell – What the Feds Say Don Udstuen Did Relating to George Ryan and Larry Warner

The U.S. Attorney’s Januray, 2004, outline of what it’s case would contain continues with an outline of lobbying of the Secretary of State’s Office by Don Udstuen, a former long-time resident of Crystal Lake, and his alledged co-hort Larry Warner.

Several vendors, including IBM, Vissage and American Decal Manufacturing, hired Warner to promote their wares.

IBM & Honeywell

At first Warner and Udstuen tried to get the “inherited” mainframe company, Honeywell, to hire them for $250,000 to promote an upgrade. In a second meeting, both suggested that their membership on the transition team represented a conflict of interest and that Honeywell should contact lobbyist Ron Swanson.

In a Springfield meeting Swanson set his price at $750,000. The Honeywell representative told its current lobbyist Robert Cook and Cook talked to Ryan. Ryan tried to persuade Cook that he knew nothing of Udstuen’s, Warner’s and Swanson’s Honeywell activities. Cook said Ryan called him the next day after talking to Udstuen and told him Udstuen had said the Honeywell had approached them. Cook, known as a highly respectable lobbyist, had no further conversation with Ryan about Honeywell, but did write “a confidential memo.”

Failing to land Honeywell’s business, Warner and Udstuen went after IBM. His friend Bob Kjellander, who was lobbyist for IBM, called Udstuen, asking his recommendation for another lobbyist. Warner was Udstuen’s choice. Warner was hired. His payment would be 3.5% of net revenues. Warner’s contract prohibited subcontractors, but Udstuen still got a cut.

In late 1991, Kjellander recommended Frank Cavallaro to Udstuen to be director of Information Systems Services in the Secretary of State’s Office. That was the division that would make the mainframe upgrade decision. Although Ryan had reservations, Cavallaro got the job.

In 1995, lobbyists of the executive branch of state government had to register for the first time. Warner was reluctant to do so for IBM until the firm upped his pay by $2,700 a month. January was the first time Warner registered as a lobbyist.

“In the time period following IBM hiring Warner, IBM’s fortunes vis-à-vis the SOS swelled,” the proffer reads. $1 million went to Warner during Ryan’s term, $250,000 of which was transferred to Udstuen.


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