Articles Posted in White Collar Crime

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The Attorney General filed a complaint in which Count IV alleged that Wildermuth, an attorney, and Kleanthis, a veteran of the real estate business, engaged in acts and practices that violated section 3-102 of the Illinois Human Rights Act by a pattern and practice of discrimination in the offering of loan modification services to Illinois consumers. The complaint alleged that defendants advertised that they would succeed where other loan modification providers had failed, help consumers save their homes and obtain significant reductions in their monthly payments. The circuit court of Cook County denied defendants’ motion to dismiss but certified for interlocutory appeal the question: “Whether the State may claim a violation under the Illinois Human Rights Act pursuant to a reverse redlining theory where it did not allege that the defendant acted as a mortgage lender.” The appellate court answered the question in the affirmative. The Illinois Supreme Court affirmed in part, stating that it is not necessary to allege that one is a mortgage lender to sustain a claim for a violation of the statute. The court concluded, nonetheless, that Count IV should have been dismissed, rejecting the state’s argument that the defendants engaged in a “real estate transaction” by providing “financial assistance for ... maintaining a dwelling.” Defendants’ services cannot be considered necessary; they were not “necessary conduits” through which funds flow, nor did they act as real estate brokers. View "Madigan v. Wildermuth" on Justia Law

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Acting under power of attorney, Chenoweth sold her stepmother’s house in 2005 and used most of the money for personal expenses. Chenoweth was charged in 2009 and convicted of financial exploitation of an elderly person, 720 ILCS 5/16-1.3(a). She sought dismissal under the standard three-year period of limitations (720 ILCS 5/3-5(b), arguing that the indictment failed to allege any circumstances that would have placed the indictment within the one-year extended limitations of 720 ILCS 5/3-6(a)(2). The court rejected her arguments and she was sentenced to four years’ probation, and ordered to pay $32,266 in restitution. The appellate court vacated the conviction, holding that the extended period of limitations (720 ILCS 5/3-6(a)(2)) had expired prior to prosecution. The Illinois Supreme Court reversed, holding that the one-year extended period of limitations commenced on January 22, 2009, when the Adams County State’s Attorney became aware of the offense when he received the police investigation file. The legislature enacted section 3-6(a) specifically to deal with the offender who has successfully avoided detection of a breach of fiduciary obligation for the term of the general time limitation. View "People v. Chenoweth" on Justia Law

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In 2006, then-policewoman Brown, entered the Chicago Patrolmen’s Federal Credit Union and presented a $1 million check made out to her and purportedly drawn by Six Flags Great America on a JP Morgan Chase bank account. She endorsed it in her own name. The check was counterfeit. Brow was charged with several offenses and testified that her mother had given her the check and had told her that it was the result of Brown’s sister’s settlement of a lawsuit. The sister already had a forgery conviction. Brown was convicted and given two years of probation and 50 hours of community service. The appellate court affirmed the convictions for attempted theft by delivering the counterfeit check and for forgery by making the check. The Illinois Supreme Court, reversed the forgery conviction, leaving the conviction for “delivery.” Brown did not “make” the check when all she did was endorse it in her own name; forgery by “making” was statutorily complete when the check was created, regardless of endorsement. There was no evidence that the defendant actually made the check. View "People v. Brown" on Justia Law

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Radojcic, his daughters, his attorney Helfand, and the office manager for one of his companies, were indicted for 52 financial crimes involving fraud on mortgage lenders. It was also alleged that Radojcic, while owing the IRS more than two million dollars, fraudulently obtained rental checks exceeding $500,000 from the U.S. Department of Housing and Urban Development. After discovery, the state indicated its intent to call Helfand as a witness in exchange for use immunity. Helfand and Radojcic objected, asserting attorney-client privilege, and the trial court struck Helfand’s name from the state’s witness list. The appellate court reversed. The Illinois Supreme Court affirmed, based on the crime-fraud exception to the attorney-client privilege, which applies when a client seeks the services of an attorney in furtherance of criminal or fraudulent activity. Transcripts of grand jury testimony met the standard of providing a reasonable basis to suspect the perpetration, or attempted perpetration, of a crime or fraud by Radojcic and a reasonable basis to suspect that communications with Helfand were in furtherance of the fraudulent scheme. The state met its burden of overcoming the privilege; there was no need to examine Helfand in camera prior before trial testimony. The only attorney-client communications that are subject to disclosure are those related to transactions identified in the indictment. View "People v. Radojcic" on Justia Law

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In connection with operation of a medical transport company, defendant was convicted of theft (720 ILCS 5/16-1), vendor fraud (305 ILCS 5/8A-3), and money laundering (720 ILCS 5/29B-1), sentenced to 66 months' imprisonment, and ordered to pay$1.2 million in restitution. The appellate court upheld the theft and vendor fraud convictions, but reversed the money laundering conviction. The Illinois Supreme Court reversed with respect to the money laundering conviction. The trial court properly allowed the state establish guilt of money laundering with evidence of receipts rather than profits. View "People v. Gutman" on Justia Law