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Articles Tagged with fraud

The man whose videotaped murder of a defenseless detainee resulted in several months’ worth of protests is now facing felony tax evasion charges. Chauvin will now face charges of second-degree murder and multiple felony counts of tax evasion

Chauvin and his wife are accused of hiding income streams on their taxes including more than $95,000 in income from his side job providing security. 

Is His Wife Also Guilty?

While Donald Trump has recently announced that federal authorities will be unleashed in major democratic cities, by now, federal involvement in Chicago has been an ongoing fact of life for major developers and politicians for centuries. Most recently, the feds filed a criminal case against ComEd, and they are also targeting House Speaker Michael Madigan.

The feds have lobbyist Mike McClain speaking to a ComEd executive. He told this executive that he should not put anything in writing and that putting things in writing could “only hurt ya.” The two men then discussed a favor for Mike Madigan that federal authorities believe is part of a larger bribery scheme.

How Did the Bribery Scheme Work?

Rahul Shah became the first person in the Chicago area with the dubious distinction of defrauding the federal government for coronavirus relief funds. Shah applied for a $441,000 federal loan earmarked for small business relief during the coronavirus pandemic. 

When confronted concerning the suspicious forms used to apply for the loan, Shah said he had workers in India file the forms for him. Later, however, he reversed course and admitted that the loan was keeping his business afloat. Shah is charged with bank fraud and making false statements to a financial institution.

The Paycheck Protection Program

Yesse Yehuda, the politically-connected head of the FORUM non-profit, has been charged by federal authorities for misappropriating $200,000 in funds earmarked to develop south suburban properties and fund a workplace training program.

Yehuda has been charged with eight counts of bank fraud and seven counts of wire fraud

Where Did the Money Go? 

Barbara Byrd-Bennett, the former Chicago Public School Chief who pleaded guilty to corruption and fraud charges and was sent to federal prison Camp Alderson in West Virginia, has recently been moved to a new facility. The 70-year-old Byrd-Bennett was sent to a residential reentry management facility that oversees halfway houses in Cincinnati.

The Bureau of Prisons confirmed the move but otherwise declined comment on why the move occurred when it did. Camp Alderson had been nicknamed Camp Cupcake after Martha Stewart’s stay there several years ago. 

The Crime

oliver-spencer-7Zc4h74Va8c-unsplash-copy-200x300A Chicago pastor has been charged with fraud after bilking funds earmarked for needy children to purchase a Bentley. Federal authorities allege that Rev. Clarence Smith Jr. stole thousands of dollars from a federal program that helped feed children whose parents could not afford to feed them. Authorities say that Smith used the money to buy a $142,000 Bentley and for other expenses that had nothing to do with starving children. 

Smith’s ministry is geared toward those who had a history of criminal activity. The motto outside of his church reads: “Ministry meaningful to the imperfect man.” Smith was convicted a decade ago of using forged signatures to rob the estate of a dead man of over $100,000. 

Since his release from prison, Smith has had some financial struggles. In 2012, he filed for bankruptcy, claiming that he only had $20 to his name. He was still paying restitution for the theft for which he went to prison. Court records show that he owed the man’s estate an estimated $80,000. He also owed $8,000 in overdue property taxes for his church. 

aidan-bartos-313782-copy-300x200The Chicago City Colleges ex-vice-chancellor has been charged alongside seven others for multiple counts of wire fraud. According to federal authorities, Sharod Gordon awarded contracts to a number of companies that had ties to Gordon’s relatives and other associates. In some cases, police say, no work was ever performed. Gordon’s ex-wife and other associates were charged in the $350,000 scheme to defraud the government. Gordon is accused of awarding the contracts in exchange for kickbacks—a clear violation of basic ethics and corruption statutes

The current chancellor, Juan Salgado, said that new safeguards were to be put in place to avoid future problems. Salgado said the district will hire a procurement director to vet all contracts prior to them being offered. This includes requiring potential vendors to provide an economic disclosure statement and be in business for at least two years.

What was Gordon’s Role?

rawpixel-1055781-unsplash-1-300x201While charges of fraud are not exactly rare when it comes to political candidates, Chicago Alderman Proco “Joe” Moreno stands accused of filing a false police report to defraud his insurance company. This is generally not the kind of fraud charges that politicians face. Nonetheless, it is still illegal.

Authorities have charged Moreno with fraud and obstruction of justice after reporting his Audi A6 stolen. After Moreno had reported the car stolen, his girlfriend, Liliya Hrabar was pulled over by police while driving it. Hrabar herself was charged with criminal trespass. During the interrogation, Hrabar produced text messages indicating that Moreno had willingly lent her the car one day prior to filing the police report. The charges against Hrabar were subsequently dropped and Moreno was charged with filing a false police report, obstruction of justice, disorderly conduct, and insurance fraud.

According to police, Moreno attempted to file a $30,000 claim with his insurance company to replace the car. The police contacted the insurance company and found that he had given differing accounts of the theft. After Hrabar was caught, Moreno claimed that he had loaned the vehicle to her but could not get it back. Moreno then claimed that because she was a single mom, he just wanted to help her out and that the road to Hell is often paved with good intentions. For that reason, he reported it stolen.

michael-d-beckwith-579345-unsplash-copy-300x253In another case of a high-profile defendant being able to buy his way out of felony charges, Aaron Schock has been offered a plea in which the prosecution will drop all the corruption charges against him if he pays the IRS tens of thousands of dollars and repays his campaign committees. Schock came under fire when he spent what seemed like exorbitant amounts of money redecorating his office in the style of Downton Abbey—a show he must really, really like. He was indicted on two dozen counts of fraud and falsification of election commission filings. He faced up to 20 years in prison.

The plea, which was offered by federal prosecutors, allows them to drop the charges against Schock if he repays the IRS within six months, but also allows them to pursue charges if he does not repay the $68,000 that he owes. Schock failed to report earnings on his income taxes and hence became the target of the IRS. Schock was accused of selling world series and super bowl tickets for $42,000 in profit and misreporting mileage that was a part of his campaigning.

Shots Fired

ales-nesetril-1070103-unsplash-copy-300x199On January 17, a man from Winnetka was given a five-year federal prison sentence for fraud.

50-year-old Thomas Lindstrom led a scheme that cost his customers almost $14 million dollars in losses. As a result, the Northfield-based company that employed him was forced to close its doors.

The former options trader at the Chicago Board of Trade was given a prison term that was approximately half the recommended federal guideline. His lawyer argued that Lindstrom committed fraud because of his fear of failure and to maintain the lavish lifestyle he was living in the North Shore.

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