Feds: Libertyville man's investment scheme netted more than $10 million

Once known as a developer of the posh Village Green project in Lincolnshire, Forrest David Laidley is now accused by federal authorities of swindling investors and financial institutions out of some $10 million.

Laidley, 65, of Libertyville, was charged with mail fraud, wire fraud and bank fraud. The 14-count indictment was announced Thursday by U.S. Attorney Patrick Fitzgerald and FBI Special Agent-in Charge Robert Grant.

Laidley didn't immediately return a telephone message seeking comment.

Court documents state Laidley offered and sold limited partnerships and short-term, high-interest guaranteed promissory notes to the public, sometimes called bridge loans, from 1999 to 2004.

Laidley, a lawyer who owned Forrest Properties Inc., offered returns of 10 percent to 40 percent to investors who provided him with cash toward purported retail and office projects in Lincolnshire, Round Lake and Glenview, according to the indictment.

Authorities accuse Laidley of making "Ponzi-type" payments to investors. It's alleged he used the $10 million for his benefit and to repay delinquent loans and for unrelated real-estate developments.

Through Forrest Properties, court papers say, Laidley obtained money from individuals, financial institutions and others by misrepresenting the expected returns and risks of investments. He's also accused of misrepresenting ownership of property for developments investors thought they were backing.

Libertyville resident Robert McDonald, a mortgage company owner, was among the investors. He said Laidley returned $100,000 in principal he invested with a guarantee of 10 percent for a bridge loan, but is owed more than $60,000 in interest he tried to get through a lawsuit.

"He was a great wordsmith," McDonald said. "He is one of the greatest wordsmiths I've ever known in my life. He's smooth."

Problems related to Laidley's investment opportunities were highlighted in a series of Daily Herald stories in 2004.

About 20 civil lawsuits were filed in courts in Lake, Cook and DuPage counties from 1999 to 2004 that claimed Laidley was not returning millions of dollars invested with him. Dennis Marx, financial adviser to wealthy families at JMG Financial Group Ltd. in Oak Brook, was one investor who sued Laidley.

In interviews with the Daily Herald in 2004, Laidley said he had a plan and all investors would be made whole. He denied accusations in the suits of misrepresentation, deception, consumer fraud and false pretense.

Federal court documents state Laidley "took steps to make complaining investors and lenders falsely believe that they would be paid."

Laidley graduated from Yale University in 1966. He played linebacker on Yale's football team and belonged to the prestigious Class of '66 Skull and Bones Society, which included Democratic U.S. Sen. John Kerry and FedEx founder Fred Smith.

He served on the board of directors at Libertyville's Harris Bank branch, Carmel Catholic High School in Mundelein and publicly traded Vasco Data Security International Inc. in Oakbrook Terrace.

Forrest Properties was known for developing Lincolnshire's Village Green shopping, restaurant and office plaza at Milwaukee Avenue at Route 22. Village Green landed in bankruptcy court in 2004, with new owners eventually taking over for Laidley.

Investors were solicited for Village Green South in Lincolnshire, Glen Gateway Shoppes in Glenview and Cedar Lake Road shopping center in Round Lake. Laidley claimed he used investors' money for land acquisition, engineering and other tasks.

In the federal complaint, it's alleged Laidley's Forrest Properties never owned land for the Round Lake development.

Among the myriad other federal accusations is Laidley misrepresented Forrest Properties' financial condition to get two lines of credit totaling $1.5 million from Libertyville Bank & Trust Co. in 2000. Court papers state Laidley informed the bank he "never defaulted on a financial obligation."

If convicted, Laidley would face a maximum of 30 years in prison on each count and a $1 million fine.