Businessman Antoin Rezko, a member of Gov. Blagojevich’s inner circle, and GOP insider Stuart Levine shook down investment firms for millions of dollars in kickbacks looking to do business with a state teachers pension fund, according to a federal indictment unsealed Wednesday.

While Levine had been charged in the case before and is cooperating with the feds, the indictment marks the first time Rezko has been charged and represents the closest federal investigators have come to Blagojevich’s inner circle.

Rezko, 51, of Wilmette, is implicated in crooked deals with more than half a dozen investment firms.

Rezko and Levine are also accused of shaking down a $1 million kickback to get state approval for a corporation to build a hospital in Crystal Lake.

Rezko, who just returned from being out of the country, has been a key fund-raiser for and adviser to the governor. His name has surfaced in state and federal probes into whether campaign contributions to Blagojevich were being traded for lucrative state contracts and appointments to government boards and commissions.

Rezko, a prominent real estate developer and restaurateur, also has been accused in a civil lawsuit filed by a national pizza chain, Papa John’s International, of defrauding the company.

Rezko’s indictment comes just weeks before Levine, a key figure in the federal probes of the Blagojevich administration, is set to plead guilty in two cases involving boards to which the governor appoints members.

Levine, a wealthy businessman and political insider, was reappointed by Blagojevich to the Illinois Health Facilities Planning Board and state Teachers’ Retirement System board. He plans to plead guilty before the Nov. 7 gubernatorial election to criminal wrongdoing involving both of those boards.

Last year, another man indicted in the TRS case, lawyer Joseph Cari, pleaded guilty and alleged that Levine told him that Blagojevich and top Blagojevich fund-raisers Rezko and Christopher G. Kelly schemed to steer state pension deals to investment firms and consultants who agreed to donate to Blagojevich’s campaign. The plea identified Blagojevich as “Public Official A” and Kelly and Rezko as “associates,” sources have said.

The governor has called Cari’s accusation “triple hearsay.” Rezko and Kelly repeatedly have denied wrongdoing.

Kelly’s lawyer said this morning he was unaware of any criminal charges being filed against his client, and there was no indication charges against Kelly were imminent.

A lawyer for Rezko could not be reached for comment.