The indictment also alleged that Serpico used one of the tainted loans to join with reputed organized-crime figure Paul Spano to construct a West Side apartment complex. The construction was reportedly aided by a decision by the City of Chicago to sell the land at a reduced rate. The indictment said Serpico obtained a $540,000 loan, with no collateral, to finance the project from Capitol Bank & Trust Co. The complex sold last Sep. for almost $1 million.
A few months after the City Council approved the sale of the site to Spano in Feb. 1989, he was indicted by a federal grand jury on charges of operating an organized crime gambling business in Cicero. He pled guilty and served seven months in federal prison. Spano is also the subject of a separate, current FBI investigation into another real estate transaction. Spano wasn’t charged with Serpico.
Reportedly, Serpico and a person identified as “Individual E” sought the loan in question in Dec. 1989. Records identified Spano as the sole owner of the property. Ex-Mayor Eugene Sawyer’s (D) administration was actively recruiting developers for the area. Records show Spano paid $30,291 for the property and that there were no competitive bids. Records also reveal they paid only $5.50 a square foot, about half the amount paid for similar property at that time. The City also agreed to a zoning change that permitted the complex to utilize more land. [Chicago Tribune 8/22/99]