First Lady Michelle Obama’s latest overseas jaunt is getting all the headlines. But President Obama’s money-grubbing junket to Chicago may cost taxpayers far more in the long run. With his Gaultier-clad wife sashaying around the Spanish seaside, the lonely fundraiser-in-chief returned to Illinois to take care of some birthday-week business. Job One: Filling the Senate campaign coffers of his corruption-tainted political protege Alexi Giannoulias.

Mission accomplished. Obama’s Thursday afternoon campaign event for Giannoulias, the beleaguered state treasurer of Illinois, reportedly raked in $1 million. Lagging behind his GOP opponent, liberal Republican Rep. Mark Kirk, Giannoulias has coveted one-on-one, grip-and-grin time with Obama for months. In addition to the cash, photo-ops and video of the Obama fundraising event that Giannoulias will milk from now until Election Day, the White House has dispatched Vice President Joe Biden, White House senior adviser David Axelrod and White House campaign management guru David Plouffe to boost Giannoulias’ bid. Plouffe proclaimed Democrats “all in” for Giannoulias, whom he described as “a great progressive champion.”

Obama gave his own personal seal of ethical approval, telling deep-pocketed donors this week: “I appreciate his strong sense of advocacy for ordinary Americans. You can trust him – you can count on him.” Uh-huh. And I’ve got a bridge to Hope and Change to sell you.

What would Giannoulias know about “ordinary Americans”? Giannoulias, 34, befriended Obama during pickup basketball games with an elite group that also included Michelle Obama’s brother, Craig; Chicago edu-crat Arne Duncan (now Education Secretary); and hedge fund manager John Rogers (the ex-husband of the Obamas’ ex-White House social secretary, Desiree Rogers). He spread his wealth and influence around early and often to support Obama’s fledgling political career. He pitched in $7,000 in 2003-2004 to Obama’s Illinois State Senate bids. He hosted fundraisers for Obama’s U.S. Senate campaign in 2004 and for his presidential campaign in 2007.

Where’d the cash come from? Giannoulias’ Greek immigrant family founded Chicago-based Broadway Bank, a now-defunct financial institution that loaned tens of millions of dollars to convicted mafia felons and faced bankruptcy after decades of engaging in risky, high-flying behavior. It’s the place where Obama parked his 2004 U.S. Senate campaign funds. And it’s the same place where a mutual friend of Obama and Giannoulias – convicted Obama fundraiser/slum lord Tony Rezko – used to bounce nearly $500,000 in bad checks written to Las Vegas casinos. This week, the Chicago Sun-Times revealed an additional $22.75 million Broadway Bank loan to a Rezko-owned business in 2006. Giannoulias held an ownership stake in the bank at the time.

Giannoulias served as Broadway Bank vice president and senior loan officer for four years. According to the Chicago Tribune, during Giannoulias’ tenure, some $27 million of Broadway Bank’s funny money went to mob crooks Michael “Jaws” Giorango and Demitri Stavropoulos. Giorango is a hustler who fronted a nationwide prostitution ring and was sentenced to six months in prison; Stavropoulos is behind bars for operating a multistate bookmaking ring. Giorango ran the $400-an-hour call girl operation out of high-rise luxury apartments in Chicago with the infamous “Gold Coast Madam,” Rose Laws. Giorango and Stavropoulos used their Broadway Bank loans to start their own risky lending business for nontraditional borrowers unable to secure traditional bank financing.

Despite Giorango’s criminal record exposed by the Tribune in 2004, Broadway Bank approved massive mortgages for him. Giannoulias’ brother, Demetris, explained that as a “relationship bank,” Broadway wouldn’t just throw someone under the bus because of a “bad article.” Instead, the bank went ahead and rubber-stamped a September 2005 loan for $3.4 million to buy a 32-unit Los Angeles apartment complex. The application falsely stated that the borrower, Giorango, had “not been convicted of a felony.” Giannoulias oversaw the servicing of such shady loans totaling $11 million. Remember: He was no low-level staffer. He was, as he reminded supporters when he needed to deflect attention away from his youth, top management at Broadway Bank.

In January 2010, the bank entered a consent decree with federal and Illinois state regulators. It required Broadway Bank “to raise tens of millions in capital, stop paying dividends to the family without regulatory approval, and hire an outside party to evaluate the bank’s senior management.” The city’s former inspector general blasted Giannoulias and his family for tapping $70 million worth of dividends in 2007 and 2008 as the real estate crash loomed. Broadway Bank was sitting on an estimated $250 million in bad loans. In late April, federal regulators shut it down. Cost to taxpayers: an estimated $390 million. Giannoulias refused to drop out of the race – and instead used the company failure to argue that it made him more qualified to serve in office: “I have a renewed vigor and a new perspective on just how horrible it is out there for so many people.”

President Obama agrees: Abysmal failure should be rewarded with promotion. He’s leaving no shady banking buddy behind.

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