Burr Ridge real estate broker accused of stealing earnest money
A Burr Ridge real estate broker accused of stealing more than $145,000 from the earnest money accounts of at least a dozen clients says he did it to keep his business afloat.
Harry Simons, 49, of the 7900 block of William Drive, Willowbrook, is standing trial charged with five counts of theft. If convicted he faces up to 15 years in prison.
Assistant State's Attorney Diane Michalak said that between February 2013 and February 2014, Simons accepted deposits totaling $145,300 from clients who wished to use his real estate agency, County Line RE/MAX in Burr Ridge, to purchase a home.
But once business slowed and Simons began having trouble paying the agency's bills, Michalak said he began transferring money from his clients' escrow accounts into the agency's operating fund. In all, more than $239,000 was transferred between the accounts in 68 transactions.
"Money is flowing all over, but none of the money is the defendant's money," Michalak told jurors in her opening arguments.
She said fellow brokers discovered the scheme - which led to an investigation by Burr Ridge police, the Chicago Office of the Federal Housing Finance Agency, the Office of Inspector General and the DuPage County state's attorney's office - when they were attending closings and the earnest money wasn't there.
Simons' attorney, John Paul Carroll, immediately told jurors that Michalak's account was completely accurate. But he said Simons isn't guilty of the theft because he never intended to deprive his customers of their earnest money permanently. In fact, he said Simons was replacing the transferred money with the earnest money of new clients until new clients started drying up.
"He told the investigator he knows he did the wrong thing for the right reasons," Carroll said. "He was trying to keep his business afloat with hopes it would grow. The problem is escrow started going down."
Carroll also said Simons knew it was against real estate broker rules, but he had actually been transferring money in this manner since 2010.
"He's not a thief and he's not a bad man," Carroll said. "But he is a bad businessman."
Simons has been free on $300,000 bail. His trial is expected to last through the week.