white collar crimes

March 8, 2023

Woman Uses Dead People to Defraud Federal Government

by Law Offices of David L. Freidberg, P.C.

A Chicago woman will spend the next five years in federal prison after authorities convicted her of using the identities of dead people to commit fraud against the federal government. According to the authorities, the woman used the identities to apply for benefits, some of which were disbursed during the coronavirus as pandemic aid packages.

The woman acquired the identities of murder victims to pull off the scam. Authorities say it netted over $45,000 in profit. The information was used to file tax returns and pandemic-related entitlements. The woman would pose as relatives of the murder victims to collect payments on their behalf.

Prosecutors characterized the theft as “morally repugnant.” The woman had prior convictions for various forms of fraud. The court, in passing sentence, characterized her as a career criminal who had multiple opportunities to turn away from a life of crime but chose fraud anyway.

January 18, 2023

Staffer Accused of Stealing $2M from Art Institute

by Law Offices of David L. Freidberg, P.C.

A staffer has been accused of stealing nearly $2 million in payroll from other employees at the Art Institute, according to a federal indictment. The staffer is accused of diverting funds meant for other employees into his own bank account. The fraud went on for nearly 10 years before it was discovered when another staffer noted unusual account activity.

According to the Art Institute, they instituted an audit process to review their financials in 2019. That was when the perpetrator was caught. The employee was immediately terminated, and the matter was referred to law enforcement. The employee is now facing charges of wire fraud and bank fraud.

The Heypenny Scheme

December 9, 2022

Benefits Coordinator at CTA Accused of Looting Pensions Using Dead Pensioners

by Law Offices of David L. Freidberg, P.C.

A benefits specialist for the CTA is facing federal fraud and embezzlement charges related to the withdrawal of $350,000 worth of pension benefits related to deceased employees. She has since been charged with five counts of wire fraud. Each count carries a maximum sentence of 20 years in federal prison, but usually, the sentence is tied to the amount of money stolen and not the number of times the fraud was committed.

According to the prosecution, the defendant made requests to disburse death benefits and pension benefits to purported beneficiaries of CTA pension plans. The funds, however, were later diverted into bank accounts controlled by the defendant. The money was then used for personal expenditures.

Authorities say that the defendant made 43 death benefit or pension refund requests totaling an estimated $350,000. The defendant worked as a bus driver and later as a retirement plan specialist.

January 5, 2022

Chicago Physician Accused of Insider Trading

by Law Offices of David L. Freidberg, P.C.

Everyone has heard of insider trading, but what is it really? Essentially, as an “insider,” you are not allowed to make beneficial trades unfairly. To prove insider trading, the federal government must show that the information was embargoed or confidential prior to the execution of the trade.

In this case, a Chicago physician is being accused of purchasing shares of a California-based biotech company that recently announced positive results of a new cancer treatment. The physician is accused of making the trade before the company announced the results publicly. Hence, insider trading.

According to federal prosecutors, the defendant used his position to acquire confidential information that was embargoed for public disclosure. He then used that information to make a trade prior to the announcement of a major success and is now accused of insider trading. Federal prosecutors accuse the doctor of making $134,000 off the illegal trade, purchasing over 8,000 shares and then selling them shortly after the announcement.

July 7, 2021

Trump Company, Finance Chief Charged With Tax Evasion

by Law Offices of David L. Freidberg, P.C.

While The Donald himself is not facing charges related to what authorities call an “audacious” tax fraud scheme, his company and his Chief Financial Officer are facing accusations that they failed to report over $1.7 million in earnings. It is unclear whether or not Trump will be charged, but investigators noted that he signed some of the questionable checks. Nonetheless, that comes short of proving fraud, which requires the prosecution to prove that the defendant knowingly deceived the federal government by hiding income streams. It is much more likely that the company’s CFO will take the fall for this.

As part of the scheme, the CFO paid himself and other executives off the books by utilizing lucrative fringe benefits, hence reducing their payroll taxes. Meanwhile, Trump is employing his usual strategy of demonizing the investigation as a “witch hunt” perpetrated by “radical democrats.”

Is This a Witch Hunt?

March 3, 2021

Defendants Added to Bank Embezzlement Prosecution

by Law Offices of David L. Freidberg, P.C.

More defendants have been added to an ongoing prosecution in which several key stakeholders managed to tank a Chicago bank by embezzling millions in funds. The Washington Federal Bank for Savings failed in 2017 after the Office of the Comptroller determined that the bank was insolvent. Four new defendants have been added to the case for the theft of over $23 million in bank money. Do they face the same sorts of penalties as those who rob banks by force? No. In this article, we will discuss the charges they are likely to face.

Why Was the Bank Shut Down?

The bank was shut down after the Office of the Comptroller determined that the bank had $66 million in nonperforming loans. What is a nonperforming loan? Essentially, it is a loan in which the borrower has not made a payment in some time. Hence, the loan has been in default for a while. It is believed that the executives, including the CFO and treasurer, floated themselves major loans and transferred bank funds without the required documentation. Those who were on the receiving end of these funds are facing charges. Those who were in charge of overseeing the bank funds are also facing charges. Those who falsified bank records to ensure that the embezzlement was not discovered are also facing charges.

January 6, 2021

Woman Steals $2.3 Million From Employer to Fund Side Gig

by Law Offices of David L. Freidberg, P.C.

This is America, where everyone has a job and everyone has a dream. The idea is to work the job until you can make the dream come true. That happened for one Illinois woman, but federal prosecutors say that the money she used to fund her dream was embezzled from her place of employment. She is now facing federal charges for the theft of $2.3 million.

72-year-old Mildred Crowley is accused of embezzling money from her employer to fund her horse farm. She is not the first to be charged with such a crime. In fact, horse farming is rife with companies that have funded their coffers on the ill-gotten gains of fraud and theft.

Criminal Enterprises: Horse Breeding and Horse Farms

December 9, 2020

G Herbo Facing Federal Fraud Charges

by Law Offices of David L. Freidberg, P.C.

Chicago rapper G Herbo has been charged in Massachusetts for using stolen identities to make illegal purchases. Purchases included trips on personal jets and designer puppies, according to the complaint. While rappers are not known for their white-collar prosecutions, identity theft is a major business in the criminal underworld. The 25-year-old Herbert Wright III is charged with conspiracy to commit fraud and aggravated identity theft. The following will take a look at what prosecutions for these crimes look like.

Who is G Herbo?

G Herbo was recently on The Tonight Show. He grew up in the South Side of Chicago, a neighborhood known as “Terror Town.” His frank lyrics about growing up in Chicago catapulted G Herbo into the forefront of the rap world. Makes you wonder why a guy like that would need to steal identities to fund his purchases of designer puppies and personal jet rides.

November 20, 2019

City Colleges Ex-Chancellor Indicted on Fraud Charges

by Law Offices of David L. Freidberg, P.C.

The 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?

November 6, 2019

Restaurateur Pleads Guilty to Wire Fraud

by Law Offices of David L. Freidberg, P.C.

Attila Gyulai, the owner of a fine dining establishment in the West Loop, has pleaded guilty to one count of wire fraud. Gyulai had returned to Chicago to face four counts of fraud and is scheduled to be sentenced on February 25th of 2020. He and his wife owned and operated Embreya restaurant, a high-end Asian establishment. The restaurant opened in 2012 and received excellent reviews, but shut down only four years later.

Examining the Plea Agreement

Gyulai’s plea agreement is interesting. Essentially, Gyulai admitted guilt to one allegation of wire fraud but also stated that he did not agree with all the details of the other allegations. The plea agreement essentially states that between 2014 and 2016, Gyulai defrauded minor shareholders in his restaurant and lied about how money generated by the restaurant was used. As part of the scheme, there was a nearly $15,000 money transfer out of the restaurant’s coffers.