P. Nicholas Hurtgen, a former Bear Stearns Cos. managing director, pleaded guilty to a fraud charge

P. Nicholas Hurtgen, a former Bear Stearns Cos. managing director, pleaded guilty to a fraud charge for his role in helping two men advance a plot to win a Chicago- area hospital construction contract. Hurtgen, 46, of Glencoe, Illinois, entered his plea to aiding and abetting wire fraud today before U.S. District Judge John Grady in federal court in Chicago. A trial had been set to start March 9. In exchange for Hurtgen’s cooperation, prosecutors agreed to ask for a 22 1/2-month sentence. Hurtgen can withdraw the plea if Grady hands out a longer term. “We are confident he will impose a fair sentence,” Hurtgen’s lawyer, Ronald Safer, said in an e-mailed statement. The charge carries a maximum penalty of 20 years in prison and a $250,000 fine, according to the plea agreement. No sentencing date has been set.

Hurtgen was a senior managing director of Bear Stearns’s Chicago office, where he helped arrange financing for construction projects. He was accused of scheming with businessman Stuart Levine and construction company executive Jacob Kiferbaum to persuade the chief executive officer of Naperville, Illinois-based Edward Hospital & Health Services to hire Kiferbaum’s firm. In exchange, the hospital would win a sought-after construction permit.

‘Close Relationship’ Hurtgen told the hospital’s CEO, Pamela Davis, that Levine “had a close relationship” with former Governor Rod Blagojevich and that the governor supported Kiferbaum’s interest in obtaining the construction contract, according to the plea agreement. Kiferbaum in June 2005 pleaded guilty to a single charge of attempted extortion in connection with the plot. Levine, who served on the state’s hospital licensing board, pleaded guilty to a fraud charge and cooperated with prosecutors in their case against Antoin “Tony” Rezko, a former adviser to Blagojevich. Hurtgen’s admitted crime helped to deprive Illinois residents of Levine’s honest services as a planning board member, according to the plea agreement. The U.S. Supreme Court on Feb. 23 declined to review the honest-services fraud conviction of Robert Sorich, a former aide to Chicago Mayor Richard Daley, letting stand a federal appeals court ruling that upheld the 2006 conviction. That same Chicago-based panel would have had jurisdiction over any post-trial appeal of a conviction by Hurtgen. “Given the current broad reading of the honest-services law and the current environment regarding public officials in Illinois, this course of action was best for Nick and his family,” Safer said. Rezko was convicted on fraud and money-laundering charges last year. Blagojevich was convicted of abuse of power by the Illinois Senate on Jan. 29 and removed from office.