A former manager of the Cook County Land Bank Authority used straw buyers to fraudulently buy and resell dilapidated properties, covertly set up a property management company, and made over $1 million in ill-gotten maintenance fees. was indicted by the federal government. commission.
Mustafa Saleh, 36, of Chicago was charged with one count of wire fraud and sentenced to up to 20 years in federal prison, according to criminal information released Tuesday.
No arraignment date has been set, but defendants indicted by information typically intend to plead guilty, as opposed to grand jury indictments. Saleh’s attorney was not immediately reachable.
The indictment reportedly included Saleh in a subpoena seeking records sent by prosecutors to land bank authorities as part of an ongoing criminal investigation into the program, which the Tribune first reported in June 2021. It took place almost a year and a half later. Promote economic development in controversial and dilapidated communities.
An investigation into other aspects of the land bank authority is underway, according to a source familiar with the matter.
The subpoena, which was sent on May 21, 2021, listed records of the sale of 24 properties by the Land Bank and emails relating to Saleh, senior asset manager of the Cook County Land Bank Authority, which oversees $75,000 a year. and other records requested. Acquisition and holding of all agency assets. Saleh left his agency in 2019, according to county records.
Employees of the Land Banking Authority are prohibited from purchasing property from agents unless it is used as the employee’s primary residence.
Over a five-year period starting in 2016, Saleh used straw buyers to purchase six properties from agents on Saleh’s behalf, and then redeveloped, resold, or sold the properties for Saleh’s economic benefit. used in other ways. The property was located in suburbs near Chicago and Oak Lawn and Midlothian, the information said.
The information also alleges that Saleh set up a property management company, Evergreen Property Services, and directed another individual to pose as its owner. Over the next three years, he signed his Evergreen contract with his Land Bank Authority and paid his over $1 million for property maintenance services.
On May 18, 2021, three days before the subpoena was issued, Saleh was interviewed by federal law enforcement and “falsely claimed to have never collected proceeds from the sale of[Land Bank]real estate.” made a statement,” said the source.
In a statement provided on Tuesday, a Randbank spokesperson said the agency “thanks the U.S. Department of Justice for its thorough investigation of the former employee,” adding that it “cooperated fully with the investigation.” ‘ added. , executive officers and other staff members were victims of this crime and were not or were not subject to this investigation. there is. “
At the time of the Tribune’s report on the subpoena, Land Bank Chairman and Cook County Commissioner Bridget Gaynor, D-Chicago, viewed the criminal investigation as a “document request” but declined to comment further.
“It’s news to me.
Prekwinkle spokesman Nick Shields said her office was not aware of any other subpoenas after federal indictments against former Randbank employees were revealed on Tuesday, and that the ongoing Regarding the Randbank investigation, she said no one in her office had been contacted or interviewed. Otherwise, he reached out to the Land Bank for comment.
Records show that in September 2020, one year after Saleh left Land Bank, he attended the agency’s monthly meeting to announce a one-year ban on former employees from buying property from the agency. I have reported that the time limit has been exceeded.
“The county rule is one year and that’s all we can say today,” said chairman Peter Friedman, according to the minutes of the meeting.
“For the record, what I do naturally is that I want to move forward and start applying for the property.
Meanwhile, the federal subpoena seeks communications, including, but not limited to, all written records, memos, notes, and email communications related to real estate acquired and sold by the Cook County Land Bank Authority involving Saleh. I was.
Prosecutors also sought “any and all correspondence” related to Saleh’s resignation.
The subpoena sought records related to Saleh, as well as a company called Dynamic Developers, which Saleh founded in 2016.
According to the criminal complaint, Saleh bought and sold two properties in Land Bank on his behalf with Dynamic Developers as a front and transferred the proceeds directly to bank accounts controlled by him.
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According to the biography he had on the land bank sitebefore working in his county post, Saleh previously worked as a portfolio manager at Galaxy Properties, where he “oversaw residential and commercial properties” and “managed property maintenance, facility projects, and new construction projects.” I got
But Saleh didn’t mention his work for Galaxy Properties when he filed for bankruptcy in 2015. a sales manager who said he was making about $2,600 a month.
Saleh, who said he used to work as a taxi driver, revealed he had more than $3,000 in unpaid taxes owed to the IRS and tens of thousands of dollars in outstanding student loans and credit card debt. Records show that the bankruptcy was discharged months later.
Indictment against Saleh will take place in the coming weeks Prekwinkle chose Jessica Caffrey, the former deputy director of the county’s office of property management, has become the new executive director of the Land Banking Authority. This is the institution’s third leader in the last two years.
Established in 2015, the Land Bank Authority acquires vacant, abandoned, foreclosed, and tax delinquent properties and prepares them for sale to rehabilitators and developers. We have received praise for the work we are doing to restore properties in distressed areas.
But it has also been a source of scrutiny and controversy. The Sun-Times Survey Investigate the deal and urge it to be commissioned by Preckwinkle. External audit To avoid disputes and ensure land is sold to qualified buyers, the agency determined that more needs to be done.
It was also criticized by Cook County Treasurer Maria Pappas for taking properties off the market and slowing potential development in the dilapidated area.