Former Bank CEO Not Guilty In Fraud Case Tied To Ex-Country Club Hills Police Chief
CHICAGO (STMW) -- A federal jury cleared the former CEO of the failed Citizens Bank on Tuesday after a one-week fraud trial, according to the U.S. Attorney's office.
The feds put Robert Michael on trial last week for alleged fraud, lies and money laundering tied to a real estate deal with disgraced former Country Club Hills Police Chief Regina Evans. Prosecutors said the transaction was meant to generate cash for Evans' entertainment business, and it ultimately funneled $634,000 into bank accounts they controlled.
The jury found Michael not guilty of all counts Tuesday night, a U.S. Attorney spokesman said.
Prosecutors said Michael and Evans pulled off the scam with help from former Chicago Police Lt. Erroll Davis. Davis pleaded guilty in 2013, weeks after he'd been indicted with Michael. Evans was sentenced in a separate case to five years in prison for stealing more than $900,000 in state grant money. While implicated in the case against Michael, she was not charged.
Scott Frankel, Michael's attorney, heralded the verdict.
"We couldn't be more pleased with the outcome," Frankel said. "This was the correct result. Bob is looking forward to putting all of this behind him".
Frankel made a point during opening statements of attacking Davis' credibility.
"We know he's a proven liar," Frankel said of Davis.
Frankel also said last week the decisions made by Citizens Bank to lend Evans and Davis the money were "smart business decisions" that were correct at the time. He said Evans and Davis did the lying, and he said there was no evidence Michael took part in it.
Michael's one-week trial featured testimony from reality TV star Andrea Kelly, the ex-wife of R&B singer R. Kelly, who appeared on the VH1 show "Hollywood Exes."
Michael leased a Dolton nightclub to Evans in August 2007 through their respective businesses, according to the feds. She also used two of her businesses in March 2008 to purchase the New Regal Theater property, which included the Regal Theater, two parking lots and a 12-unit apartment building at 1665 E. 79th, records show.
Michael allegedly prompted Citizens Bank to loan Evans $2.1 million to buy the property, but the feds say he excluded the apartment building from the collateral securing the loan. Assistant U.S. Attorney Megan Church told the jury that Evans owned the apartments "free and clear" as a result.
She said that helped Michael and Evans evade Citizens' Bank's legal lending limits. It was also allegedly meant to help Evans generate new cash she could use to pay the rent she owed Michael's company for the Dolton nightclub lease. By the end of 2008, the feds say Evans owed him more than $240,000.
Andrea Kelly testified that she considered opening a dance studio in the "old, abandoned apartments" by the Regal. She found space in Country Club Hills instead, but she said her signature was forged on a lease document for the Regal apartments that also appeared to be signed by Davis.
Michael allegedly led Citizens Bank to loan $650,000 to Davis for a phony purchase of the apartment building, supposedly for $900,000. Michael and Evans even created false leases to show cash flowing to Davis at the building, Church said.
"It's all false, and he knew it," Church said of Michael.
Michael ultimately engineered the deal so that a $634,000 check would be deposited into the trust account of an attorney representing Evans. That attorney, John Klytta, then issued checks to accounts controlled by Michael and Evans, according to the feds.
(Source: Sun-Times Media Wire © Chicago Sun-Times 2016. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)