Chicago Bosses Indicted by Federal Grand Jury

A federal grand jury in Chicago returned an indictment Aug. 4 against two union bosses for engaging in a pattern of criminal activity that included fraud, soliciting kickbacks, money laundering, and illegal currency transactions. The criminal indictments were returned against John Serpico and Maria Busillo, both executives of the Central States Joint Board. CSJB is a labor group that administers pension and health-welfare plans for eight Chicago-based local unions, including LIUNA. Serpico also heads the Ill. Int’l Port Authority and has been a major political patron of Ill. Govs. James Thompson (R), Jim Edgar (R) and George Ryan (R) as well as Chicago Mayor Richard Daley (D).

Serpico was CSJB president from 1975-94 and is still a consultant. Serpico was also a LIUNA vice president until he was forced to resign as a component of DOJ’s effort in 1995 to rid the union of corrupt influences. Busillo is the current CSJB president and holds top posts with several of the affiliated locals.

The indictment indicates that Serpico and Busillo exercised near complete control over CSJB and used their influence for a variety of illegal schemes. The indictment accuses them of steering CSJB assets to various banks in return for favorable terms on personal and business loans totaling more than $5 million. Capitol Bank & Trust issued eight of the nine loans and pled guilty in 1996 for its role, paying an $800,000 fine. Separately, Serpico allegedly defrauded CSJB pension plans by soliciting and receiving kickbacks in return for a $6.5 million speculative mortgage loan for construction of a hotel in Champaign, Ill.

The two were charged with one count of racketeering, racketeering conspiracy, bank fraud and making false statements on a bank application. Serpico and Busillo were charged with seven and two counts of mail fraud, respectively. A third defendant, Gilbert Cataldo, was charged with three counts of mail fraud. The ex-Chicago housing commissioner, allegedly conspired with Serpico to obtain $334,000 in kickbacks. [Chicago Sun-Times & BNA 8/5/99]