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Articles Tagged with fraud

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.

william-stitt-162589-unsplash-copy-300x200White collar crime is most common in the corporate world. It is a group of crimes that are typically committed by business people who have access to insider information, funds, assets, and other items. Those who commit a white collar crime can face years in prison if convicted and if they are not able to reach a deal with the prosecutor assigned to the case. Let us take a look at the different types of white collar crimes.

Securities Fraud

Securities fraud is one of the most common types of white collar crime committed today. This white collar crime occurs almost exclusively in the corporate world. The most common form of securities fraud is that of insider training. Insider trading occurs when a person who has information about the company for which they work and uses it to their financial advantage.

hush-naidoo-382152-copy-300x200The government is trying to review and reform the healthcare system, but there are still some people in Chicago who are committing Medicaid fraud. There are many fraud prevention measures that have been put in place. Yet, there are people who work to see how they can deceive the government.

This is a serious offense that can lead to serious jail time. Recently, Santila Terry, a 45-year-old woman who lives in Chicago, was facing charges for committing both identity and Medicaid fraud. The total estimated loss in the case was almost $1 million. This case is typical in terms of how frauds of that nature are committed.

A service provider bills the government for services that were never delivered right up until they are discovered. According to reports from the Attorney General, Santila was claiming to provide speech therapy to people who did not exist. Another part of the case was identity fraud. Special Therapy Care Chartered used the personal information and Medicaid service provider ID of a previous employee to falsely bill the government.

aaron-burden-149693-copy-300x225Although Chicago would like to make itself a friendly place for businesses, there are some types of businesses that will never be welcomed here. One of them is telemarketing fraud, an infringement on consumer protection laws. This offense has gotten the attention of legislative bodies and the wider legal community because it affects communities in a big way. A particularly resourceful criminal can defraud a whole segment of the community and leave them in difficult circumstances. It is for this reason that the offense is recognized as being serious and attracts prosecutorial interest whenever the facts are proven. Underpinning the law is the expectation that businesses will follow a code of ethics. Unfortunately, there are some industries that do not abide by such a code.

The self-regulation model has failed in a world of cutthroat competition. Those who play by the rules end up being priced out of the market whilst those who are taking consumers for a ride are given an expressway to seemingly insurmountable success. The law is clear about the obligations to sell in an honest manner, regardless of the temptation to take competition to its zenith. The victims are typically trusting and vulnerable. These have always been aggravating features in virtually any crime that you can think of in Chicago. The courts have continued the tradition of punishing those offenders who target the most vulnerable.

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