They think they won't get caught because, as you correctly posited, they are stupid and corrupt. Not to mention arrogant. Blago clearly thinks he's smarter than everyone else - stupid and arrogant is a deadly combination.
Health care costs are the biggest single reason for bankruptcies. I don't know if that's also true for foreclosures. I think there are other factors there. Either way, it's an excellent argument for universal health care.