Recently in Fraud & White Collar Crime Category

After six weeks, the prosecution has finally closed its case against former Illinois Gov. Rod Blagojevich, the Chicago Sun-Times reported. The former governor was charged with corruption on suspicion of trying to sell the US Senate seat vacated by President Barack Obama.

Prosecutors finished up with a testimony by Patrick Magoon, CEO of Children's Memorial Hospital. He said that less than a week after then-Governor Rod Blagojevich pledged $10 million in state funds for the hospital, his brother called and asked him for a $25,000 campaign donation:

"I felt threatened; I felt at risk, and I felt a little angry. But what caused me the greatest concern was that the governor had the sole power... I felt the commitment could be rescinded."

As if finding jurors that haven't read any news coverage of the ongoing corruption trial of former Gov. Rod Blagojevich wasn't hard enough, the Chicago Sun-Times reported that many of the dozen or so prospective jurors had been openly discussing articles about the case.

And since that violates the rules of the court, specifically a media blackout imposed by U.S. District Judge James Zagel, it could have pushed back the trial date yet again.

That might have suited Blagojevich's Chicago criminal defense attorney just fine, since his client had unsuccessfully requested a delay.

There's a reason why reputed mobsters most often get taken down on tax evasion fraud. While organized crime bosses are able to cover their tracks and hide behind lower-ranking members, hiding money and cheating the Internal Revenue Service is not so easy.

If you're caught defrauding the IRS, the strong arm of the law comes down swift and hard. And an Illinois criminal defense attorney may have a difficult time defending against suspicious paper trails.

Which brings us to the story of 28-year-old Ovidiu Isac, whom authorities believe cheated the IRS out of roughly $1.3 million dollars, as covered by the Chicago Tribune.

Former Melrose Park Police Chief Vito Scavo could have been sentenced to more than 25 years in prison but instead got a six-year sentence, according to an article in the Chicago Sun-Times. Mr. Scavo was found guilty on extortion and racketeering charges linked to his private security firm.

The former police chief extorted area business owners to hire his private security firm. However, details of just how he pressured or coerced businesses were not disclosed in the article. 

Mr. Scavo's Chicago criminal defense attorneys had asked for a 5-year sentence for the fraud conviction, according to the article. 

Perhaps on the advice of his Chicago criminal defense attorney, Ald. Isaac Carothers (29th Ward) pleaded guilty to charges of taking bribes and will spend 28 months in prison, according to an article in the Chicago Sun-Times. He pleaded guilty to a bribery and fraud scheme involving developer Calvin Boender.

The Chicago City Council member, a key ally to Mayor Daley, also submitted his resignation earlier this week. According to the Chicago Sun-Times, Carothers is the 31st Chicago alderman convicted of crime since 1973.

After a judge sentenced Rudy Fratto to a year in prison for the white collar crime of tax evasion, the widely suspected Chicago mobster showed off his healthy sense of humor when he said the following outside the courtroom (Sun-Times):

  "I'm a reputed good guy."    

Not that avoiding taxes on an estimated $800,000 over seven years is the mark of a "good guy," but Fratto tried to explain that he was living beyond his means as he made an honest effort to take care of his family.

He certainly knows how to hide money, though, as prosecutors were able to prove that Fratto had several firms pay him through the bank account of a defunct company he controlled.

Police agencies throughout the northwest suburbs have arrested nearly two dozen suspects for what they say was a $2 million fake payroll check-cashing scheme (Sun-Times). A flurry of suspicious checks throughout the area got the attention of police and sparked a wider fraud investigation. 

Those left holding the bag (i.e. worthless checks for which they paid out real cash) include Wal-Mart, Northwest Liquors in Elgin and All Credit Lenders.

The alleged ring leader of the crime scheme printed out counterfeit payroll checks, which were then cashed at several businesses across a four-county area (including Boone, Kane, McHenry and Winnebago). Ill-gotten cash was then laundered through area casinos, according to the article.

After a year-long investigation, Cook County Regional Office of Education superintendent Charles Flowers has been accused of stealing nearly a half-million dollars of taxpayer money (ABC Chicago). He turned himself in to police and will face corruption charges (theft and official misconduct) for his alleged white collar crime.

Prosecutors say 51-year-old Flowers began ripping off the already broke and bankrupt school district soon after he won election as the regional superintendent in 2007. Some of the money allegedly went to his sister and girlfriend, who was put on the district payroll.

He's managed to evade criminal charges of financial fraud for years, although he's been investigated by the FBI for allegedly bilking "his pastor, fellow parishioners at his church, his children's former teacher, retirees and the disabled," according to an SEC complaint cited by a Tribune article.

He also has been accused of defrauding several professional athletes who hired him to invest their money. But his alleged sociopathic, predatory behavior didn't end there.

The temptation to make a little extra cash on the side proves overwhelming for some in positions of regulatory power. Indeed bribery is the only way to win business in some countries.

So perhaps we shouldn't be too surprised about Chicago plumbing inspector Mario Olivella's conviction by a federal jury (Sun-Times) this week.