Jury Convicts Ald. Patrick Daley Thompson In Federal Tax Fraud Trial

CHICAGO (CBS) -- A jury has convicted Ald. Patrick Daley Thompson (11th) of federal tax fraud charges, following the first trial of a sitting Chicago alderman in more than two decades.

Jurors deliberated about 3.5 hours Monday afternoon before reaching their verdict. Thompson's family, who had to watch the proceedings from an overflow courtroom due to COVID-19 restrictions, could be heard sobbing as the verdict was announced.

Thompson was found guilty of five counts of filing a false income tax return, and two counts of false statements to the Federal Deposit Insurance Corp regarding $219,000 in loans and other payments he received from Washington Federal Bank for Savings. The false statements charges each carry a sentence of up to 30 years in prison, while the tax charges each carry a sentence of up to 3 years behind bars.

His sentencing has been set for July 6.

The conviction also means Thompson must immediately resign from the City Council. Mayor Lori Lightfoot will have 60 days to appoint someone to fill his vacancy until the next municipal election in 2023.

"Alderman Patrick Thompson has been judged by a jury of his peers and found guilty. This week, we will be outlining an open and transparent process to fill the vacancy with a qualified public servant that represents the values of the residents of the 11th Ward and the city of Chicago," Lightfoot said in a statement Monday evening.

The jury began deliberating early Monday afternoon, after about three hours of closing arguments from prosecutors and defense attorneys.

When it comes to his federal trial, there were a lot of firsts for Thompson, who is former Mayor Richard M. Daley's nephew and Richard J. Daley's grandson. The 52-year-old Thompson was the first member of the Daley family to face federal charges, and is now the first Daley to be convicted. He was also the first Chicago alderman to go to trial in decades.

Thompson did not speak to reporters as he left the Dirksen Federal Courthouse after his conviction, but defense attorney Chris Gair said, "I'm extremely disappointed in the United States Attorney's office for bringing this prosecution."

In his closing argument, Gair suggested to jurors the government went after his client specifically because he's a member of the Daley family.

Federal prosecutors said Thompson borrowed $219,000 from the now-defunct Washington Federal Bank in Bridgeport. They allege Thompson only made one payment and paid no interest, even though he reported interest payments on his income taxes. The feds said Thompson then lied to the FDIC about how much he borrowed.

The 54-year-old was charged with filing false tax returns and making false statements to federal employees, specifically over how much he borrowed and owed to the bank. The feds claim he did that in order to avoid paying back more than $100,000 he owed, thinking he wouldn't get caught because the bank's president killed himself days before the bank failed.

Assistant U.S. Attorney Michelle Peterson told the jury, "when he saw an opportunity to lie, to deceive, to pay less than he owed, he took it."

"He thought he could trick them," Peterson said.

But Thompson's defense lawyer harkened back to what he used in opening statements; that the alderman has a hectic life and forgot how much he'd borrowed.

"Character matters. Character counts," defense attorney Chris Gair told the jury. "He's not the type to go around scheming, plotting, lying, (and) cheating."

Thompson has not made any comment during his trial, but has asserted he is innocent since the day he was indicted last April.

More than a dozen people have been indicted in connection with the failed bank.