12 plead in kickback scheme at Des Plaines firm

Twelve of 13 people charged last year in the investigation of a Des Plaines' company's sales practices have pleaded guilty, although some to much lesser crimes than originally charged.

Federal agents were investigating whether salespeople with Lawson Products were giving kickbacks to various government employees so they would buy from the company. The company itself has not been charged.

Federal prosecutors attempted to get agents hired at the company as part of their investigation, they said in court this week.

The revelation came as one of the 13 people convicted, Charles Schertzing, 55, of Niles, was sentenced to probation and community service for making false statements to FBI investigators.

Schertzing was maintenance director for Skokie Elementary District 72 and began cooperating with federal agents investigating Lawson Products and its subsidiary, Drummond American Corp.

Company sales agents would issue Winners Choice gift certificates to those in charge of buying cleaning supplies and tools at companies, school districts, village and township governments.

The certificates could then be used at various stores for merchandise or, in some cases, exchanged for cash. Government employees, however, are prohibited by law from accepting any outside compensation for performing their duties.

According to an affidavit filed in support of a 2005 search warrant, some of those receiving the certificates would receive as kickbacks up to 5 percent of the value of the products their employers purchased.

Schertzing was cooperating with the government but told a friend, Joseph Bettuzzi, 41, of Niles about the investigation. Bettuzzi was maintenance director for Niles Elementary District 71 and originally was charged with fraud, but a jury could not agree on his guilt or innocence in a February trial. Eventually he pleaded to the lesser crime of failing to report income on a tax return.

He has not yet been sentenced. His attorney could not be reached Thursday, but has said previously Bettuzzi is a "hard-working, salt-of-the-earth, ordinary guy."

Assistant U.S. Attorney Brandon Fox told U.S. District Judge Elaine Bucklo Thursday that Schertzing's alerting of Bettuzzi to the investigation could "have been very detrimental to the case" because they were trying to get agents hired at the company at the time.

Schertzing's attorney, Jennie Levin, said her client acted only out of loyalty to his friend because he had introduced Bettuzzi to a Drummond salesman and felt responsible for Bettuzzi's involvement.

That salesman, Scott Osika, 52, of Hoffman Estates was sentenced Wednesday for one count of mail fraud. He received a sentence of seven days in jail from Bucklo.

Osika is "a very caring, decent man who's active in the community and unfortunately worked for a company that had a marketing plan that ended up getting Mr. Osika in trouble," said his attorney, Robert Fisher.

Lawson Products did not return a phone call Thursday, but it has said in the past it fired several employees in response to the investigation, instituted a new ethics program and cooperated with federal authorities.

According to the search warrant affidavit, a company regional sales manager was recorded telling a sales agent to be covert about awarding Winners Choice points to government employees. The salesman should target only municipal and township employees rather than federal employees because the chance of getting caught was much less, the sales manager told the salesman.

"You're not going to get called out on a … township. You're just not. It's nickel dime. … It's kind of like you got caught with a … joint in your pocket versus you got caught with a truckload of marijuana," the manager was recorded saying.

The manager no longer works there.