Des Plaines man charged with mortgage fraud
A Des Plaines man was charged Wednesday with being the ringleader of what Cook County State's Attorney Anita Alvarez called "a very complicated and sophisticated scheme" to commit mortgage fraud.
Jimmy Pililimis, 36, of Des Plaines, and Anthony Palermo, 41, of Elmwood Park, were originally arrested in March in a sting conducted by the state's attorney's office, the Chicago Police Department and the U.S. Department of Housing and Urban Development's inspector general, and were charged with financial-institution fraud.
A new criminal complaint filed Wednesday in Cook County circuit court charged Pililimis with being the organizer of a continuing financial-crimes enterprise and identity theft, Class X felonies punishable by six to 30 years in prison.
The charges of loan fraud and attempted identity theft, felonies with sentences of four to 15 years, and attempted theft, with a potential sentence of four to seven years, were added for both men. Pililimis also was hit with a lesser theft charge stemming from an allegedly fraudulent auto loan that prompted the investigation.
Pililimis, of the 1100 block of Seymour Ave. and owner of Kitchen & Bath Studio in Chicago, did not return a call for comment. Palermo, of the 1900 block of North 77th Avenue, was identified in the complaint as owner of First Start Mortgage in Chicago. He declined to comment.
Wednesday evening, Palermo's attorney, Kevin Milner, said, "The charges, at least as they involve Mr. Palermo, involve one loan that supposedly was made via his mortgage company. In fact, if anybody looks at his actual involvement in the loan, he did nothing wrong.
"This is a guy who's never been in trouble a day in his life," Milner added. "Nobody has ever questioned his integrity or his professionalism in his business. Not anybody, not ever,"
Two unidentified co-defendants, who acted as straw purchasers in the scheme, were also indicted on felony charges and will be named when they're arraigned in court June 11.
According to the fresh complaint, Pililimis used one of the co-defendants to obtain fraudulent auto loans, then branched out to HUD properties in Chicago's depressed Englewood neighborhood. The other co-defendant acted as a co-signer, and Pililimis is accused of supplying both with fraudulent employment documents, tax forms and bank statements.
The original investigation led the law-enforcement agencies to conduct a like-minded sting involving Pililimis and Palermo using undercover agents as potential straw purchasers.
"Traditionally we have prosecuted mortgage fraud reactively after the crime had occurred, when the victims had already lost their money and the properties were headed into foreclosure," Alvarez said.
"We are now going to target this crime proactively and instead of merely chasing a paper trail, we intend to chase the defendants themselves and work to prevent the fraud before it occurs."
Alvarez credited her office's new mortgage fraud investigations and prosecutions unit, created with the help of a $2.3 million federal stimulus grant.
As such fraud typically involves the mortgage holders walking away from the properties, leaving the loans for foreclosure, Alvarez and Chicago police Sgt. John Lucki both said such scams create abandoned buildings in depressed neighborhoods that act as magnets for other criminal activity.