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updated: 6/20/2012 6:53 PM

Bail set at $10 million for figure in Blagojevich scandal

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  • Raghuveer Nayak was arrested in Oak Brook.

    Raghuveer Nayak was arrested in Oak Brook.


An Oak Brook man who was a key figure in the scandal that brought down former ov. Rod Blagojevich is facing a bevy of federal charges related to the operation of several outpatient surgical facilities he ran throughout the Chicago area.

Federal officials said 58-year-old Raghuveer Nayak was arrested today at his Oak Brook home inside a gated neighborhood. Prosecutors accuse him of filing false tax returns and bribing physicians for patient referrals.

He is charged with mail fraud, racketeering and filing false income tax returns and could face a maximum of 20 years in prison if convicted.

Prosecutors are seeking forfeiture of at least $1.8 million in alleged fraud proceeds or substitute assets, including Nayak's home in Oak Brook and surgery centers located in the far north Chicago neighborhood of Rogers Park.

A judge set Nayak's bail Wednesday at $10 million. Nayak, who pleaded not guilty, has agreed to post six properties in Indiana and Illinois and was released from custody immediately after a brief hearing in federal court.

Federal prosecutors said Nayak defrauded patients by arranging "bribes" and "kickbacks" to physicians who would refer their patients to Nayak's facilities for treatment. Prosecutors said "hundreds of thousands of dollars" were paid to different physicians in exchange for referrals. The indictment also states that prosecutors believe Nayak underreported personal income between 2005 and 2008.

Nayak was a key figure in both the prosecution of Blagojevich and an investigation into wrongdoing by Rep. Jesse Jackson Jr.

A 2009 congressional ethics office report indicates Nayak offered to raise money for Blagojevich in an effort to get the then-governor to appoint Jackson to the U.S. Senate seat vacated by Barack Obama's election to the presidency in 2008. Jackson has denied any improprieties.

• Daily Herald news services contributed to this report.

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