District 89 discusses issuing bond for working cash

On Monday, October 1, at 5:00 PM, the District 89 (Maywood and Melrose Park elementary schools) board of education held a special meeting to discuss district finances.

After a presentation by a representative from UBS, the board informally agreed to move ahead with issuing a working cash bond. The UBS woman portrayed the money as not quite essential, but helpful to keep the district's cash reserves sufficient that an emergency wouldn't cause checks to bounce. UBS is a financial services company that will be paid for processing the district's bond.

Because financial services fall under the exception of “professional services” the district will not be required to seek bids for the work on letting the bond. UBS employees have given generously to Mayor Richard M. Daley.

Also, the district is on course toward needing to go to the taxpayers for a referendum for either academic year 08-09 or 09-10. The speaking board members expressed frustration that the district overspends various sub-district budgets before the board of education becomes aware.

There were only three people in the audience: Arbdella Patterson, a former school board candidate, Willie Mack, of the regional superintendent's office, and me.

After the meeing I spoke to Grady Rivers, president of the board of education, about Sandra Berryhill, who has been nominated to the board. The district contends that Regional Superintendent of Education Charles Flowers missed the deadline for nominating a candidate. See Proviso Insider.

As I understand it Flowers made two claims about District 89's handling of the vacancy. One, the district failed to meet it's obligation of notifying the regional superintendent of the vacancy withing the five days required by law. Also, the notificaation was misleading or ambiguous as to the effective date of the vacancy.

I asked Rivers how he justified spending money on legal bills contesting the nomination of Berryhill when the district is nominally trying to cut unnecessary expenses. Rivers responded that it was Flowers who was forcing litigation and legal wrangling on the matter.

The curious thing about Rivers' behavior is that after I thought we were finished discussing the matter Rivers came back to re-open the discussion, twice. Largely, he restated his position. In the third encounter, I asked Rivers if Flowers was right and District 89 missed its deadline for notifying the Regional Superintendent of Education about the vacancy within five days, would he allow Berryhill to be seated. Rivers stated that if this determination was made legally then he would accept it. I think Rivers answer makes it clear he intends to fight Berryhill joining the board of education by all legal means at his disposal. No amount of tranfering money from eduction to legal bills is too much to keep Flowers' nominee off the board.

Presumably, either the board's attorney, Emanuel “Chris” Welch (of Sanchez, Daniels & Hoffman), or a firm designated by him will make money fighting to keep the seventh seat on the board of education vacant.

Also, board member Ric Cervone has been indicted for corruption. There is currently a 3-3 split on the board on some matters. Cervone is due to be tried in February, 2008. Rivers may figure that once Cervone is convicted, the Rivers-Neely-Cooper block will have a 3-2 advantage and be able to control the appointment of the new board member. With Berryhill on the board there could be a 3-3 deadlock creating a situation where Flowers would appoint Cervone's replacement too.

Melrose Seven becomes Melrose 6+1?

I attended the arraignment of the seven Melrose Park Police Department personnel indicted by the feds this morning.

Two things seemed most significant.

Six of the seven were arraigned together as part of the 9:30 docket. Ric Cervone was arraigned separately as part of the 10:30 docket. All seven pleaded not guilty and had the same conditions imposed on them by Judge Joan B. Gottschall.

One of the conditions was that the defendants are not to have contact with potential victims and witnesses. I got the impression that the court was trying to allow at least Cervone to continue working as a police officer. How can Cervone or any of the others continue to work for the Village of Melrose Park and avoid contact with potential victims and witnesses?

One of the arguments in the indictment is that these private security companies run by the defendants diverted policing resources from the Village of Melrose Park to private contracts. If the U.S. Attorney takes this allegation seriously, it seems hard to reconcile allowing any of the defendants to continue on village payroll if the judge has ordered them not to be in contact with potential victims or witnesses.

will Cervone implicate Calderone for alarm deal at District 89?

Many of the anti-establishment, pro-reform crowd in Forest Park suspect Mayor Anthony Calderone is a nefarious political actor and using his official position for personal benefit. The allegations are largely that he uses the implied threat of being liquor commissioner to coerce support from bar owners and that he finds various ways to convert his political influence into contracts for his alarm business, Illinois Alarm.

For example, some suspected Illinois Alarm's contract with District 89 (Maywood and Melrose Park elementary schools) looked suspicious. Later we learned Illinois Alarm made over $800,000, not including the monthly fees. (BTW, when is Forest Park Review going to do the news story on this?)

Seven people connected with the Melrose Park Police Department were indicted on Thursday, including District 89 board member Ric Cervone.

Many of the anti-Calderone people are salivating at the possibility of Cervone telling the feds that Calderone's alarm contract at District 89 was an illegal sweetheart deal.

did a lawyer assist Cervone in obstructing justice?

I usually resist the temptation to debunk each story on Proviso Insider. My brother analyzed Proviso Insider as being “entertainment”, a sort of parallel universe created by the author(s). It is based on “what ifs” and wishful thinking.

But the spin on the Melrose Park PD indictments is interesting. See Proviso Insider.

Sources tell the Insider that one of the current police officers indicted is G. Ric Cervone, a board member in School District 89. Sources say Ric Cervone was probably indicted because he takes advice from Mark Sterk of Odelson & Sterk. Sources say both Mark Sterk and Burt Odelson are also about to be indicted.

Or Proviso Insider:

Sources tell the Insider that Burt Odelson and Mark Sterk of Odelson & Sterk, Ltd law firm will be indicted next by U.S. Attorney Patrick Fitzgerald. Sources tell the Insider that Mark Sterk was the attorney advising SD89 Board member Ric Cervone on how to lie to a grand jury. Sources also say Sterk was passing on fees for helping Cervone to Maywood SD89.

Proviso Insider says one of the Melrose Park police officers was coached to lie to the grand jury. This is not an exceptional insight. I heard this rumor when the cops were testifying and the indictment includes multiple obstruction of justice charges.

Proviso Insider claims that an attorney coached Ric Cervone to lie to the grand jury. The indictment doesn't name any attorneys, but it doesn't seem impossible that the attorneys played a role in helping Cervone and others to create a plausible defense.

Proviso Insider names Mark Sterk as the attorney who coached Cervone to lie. This part makes less sense. Proviso Insider claims Sterk helped Cervone because of their relationship at District 89 (Maywood and Melrose Park elementary schools). Cervone was on the board and Sterk was the board's attorney.

Why would Cervone turn to the school district attorney for help? He had a lawyer paid for by the Village of Melrose Park to work on this case.

If a lawyer coached Cervone to lie, it seems more likely it was either the attorney hired by Melrose Park to work on the case, Anthony Onesti, or, possibly, the village's general counsel Giglio & Del Galdo. Giglio & Del Galdo are large political contributors to Melrose Park village president Ron Serpico.

From the indictment:

COUNT TWO
38.It was further part of the scheme that on or about September 21, 2005, after learning of the existence of the federal criminal investigation, including the Grand Jury Investigation, defendant CERVONE met at the Police Department with Day Shift Officer 1 and Officer A and provided them with false information about their accumulated time due and how they had earned it, well knowing that time due was being investigated by the Grand Jury and with the intent that Day Shift Officer 1 and Officer A would present the false information to the grand jury and federal agents.
39.It was further part of the scheme that on or about September 21, 2005, after the meeting described in paragraph 38 above, and after learning of the existence of the federal criminal investigation, in the Grand Jury Investigation, defendant CERVONE again met with Officer A at CERVONE's home in Melrose Park, during which CERVONE directed Officer A to lie to federal agents and the grand jury about how Officer A earned his time due so as not to implicate CERVONE and defendant SCAVO.

COUNT TEN
2.On or about December 26, 2003, in the Northern District of Illinois, and elsewhere, VITO R. SCAVO and GUY RIC CERVONE, defendants herein, for the purpose of executing and attempting to execute the above-described scheme, knowingly did cause to be transmitted by means of wire communication in interstate commerce a writing, sign, and signal, in that defendants SCAVO and CERVONE caused a wire transfer, of which $2,149.21 represented Officer A's salary for the par period ending December 31, 2003, from Melrose Park's bank account at Banco Popular in Melrose Park to an ADP bank account through the Federal Reserve's facility in New Jersey;
In violation of Title 18, United States Code, Section 1343, 1346, and 2.

COUNT ELEVEN reads like COUNT TEN except the date is August 17, 2005.

COUNT NINETEEN
2.On or about September 21, 2005, at Melrose Park, in the Northern District of Illinois, Eastern Division, GUY RIC CERVONE, defendant herein, corruptly endeavored to influence, obstruct, and imped, and to influence, obstruct, and impede the due administration of justice, namely:
a. CERVONE provided Day Shift Officer 1 and Officer A with false information about their time due and how they accumulated it, well knowing that time due was being investigated by the grand jury and with the intent that Day Shift Officer 1 and Officer A would present the false information to the grand jury and federal agents; and
b. CERVONE directed Officer A to lie to federal agents and the grand jury about how Officer A earned time due so as not to implicate defendant CERVONE and Scavo;
In violationof Title 18, United States Code, Section, 1503.

Let's assume Cervone was going to work with a lawyer to concoct a story to protect himself or the enterprise from federal agents or the grand jury detecting the illegal acts. Which lawyer does it make the most sense for Cervone to engage? Or turn the question around. Which lawyer has a motive to approach Cervone about lying to the feds?
a. Mark Sterk
b. Anthony Onesti
c.Giglio or Del Galdo

Onesti and probably Giglio & Del Galdo already knew the facts of the case. If the feds brought down the enterprise Sterk wouldn't lose anything. He'd still have the same legal accounts. However, if bringing down the enterprise resulted in Ron Serpico losing his position as village president Giglio & Del Galdo would lose many of their most lucrative legal clients. Onesti got tapped for the MPPD contract because of his close relationship with Giglio & Del Galdo.

If Cervone worked with a lawyer on concocting a cover story it seems much more likely it was either Onesti or one of the lawyers at Giglio & Del Galdo.

What did Mike Del Galdo tell me at the special meeting of the District 209 board of education, “If you want to get treated like a professional you have to act like a professional.” Wouldn't it be ironic if unprofessional behavior got Del Galdo convicted? Hey, Mike, there's more to being professional than wearing a suit and sucking up to those in power.

BTW, props to Shamus Toomey for this lead, Sun-Times (Shamus Toomey):

The feds Thursday called it "an illegal racketeering enterprise."

In Melrose Park, it was known as the police department.

Details of indictment of Melrose Park PD personnel

On Thursday, July 19, 2007, at the request of the U.S. Attorney, Northern Illinois District, a grand jury empaneled in December, 2005 returned indictments against seven Village of Melrose Park employees connected to the police department. The indicted include former chief of police Vito Scavo, two deputy police chiefs Gary Montino and James Caputo and one District 89 (Maywood and Melrose Park elementary schools) board member, Lt. G. Ric Cervone. The other personnel indicted were Michael “Mickey” Caliendo, Michael Wynn and German Cepeda.

The indictments were for extortion, ghost-payrolling, mail fraud, obstruction of justice and tax evasion.

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Scavo owned one private security company (DOD Security Consultants, Inc., “a for-profit unlicensed private security contractor agency”) and recruited clients for IFPC Worldwide, Inc. (Who are the officers and agent of IFPC?) Caputo and Caliendo, a civilian supervisor of part-time officers, also operated a security company called “Police Department Security” out of the Melrose Park Police Department.

The indictment alleges that these security companies used village police officers paid by taxpayers to provide security while the clients paid the private companies. In some cases the contracts were made under threat or misrepresentation. The security companies charged above the market rate for their services. Clients felt they could not decline the services without experiencing retaliation from the chief of police of the police department.

Taxpayers were also cheated out of legitimate police services because private security work took priority over village policing duties.

Montino is alleged to have billed Cinemark for hours he didn't actually work and ordered private security personnel to wear shirts and jackets identifying them as police in violation of Illinois law.

Also, Scavo tricked Navistar into letting him use their parking lot. Navistar thought it was providing a public service to the village. Scavo was charging people to park the cars and keeping the money.

The first grand jury investigation began in Spring, 2005.

Capitol Fax Blog posted the indictment.

I'll have more on the indictment later.

CBS2-Chicago had a useful summary.

Charges in the indictment returned Thursday include:

-- Scavo, 59: 10 counts of mail or wire fraud, nine counts of filing false individual or corporate federal income tax returns, and one count each of racketeering conspiracy, extortion and obstruction of justice;
-- Montino, 51: one count of racketeering conspiracy and four counts of mail fraud;
-- Caliendo, 64: one count of racketeering conspiracy and seven counts of mail or wire fraud;
-- James Caputo, 63, former deputy police chief who resigned in 2004: four counts of mail or wire fraud;
-- Cervone, 56: two counts of mail fraud and one count of obstruction of justice;
-- Michael Wynn, 53, a part-time police officer: three counts of mail fraud; and
-- Cepeda, 40: one count of extortion.

Chicago Tribune (Sara Olkon and Joseph Sjostrom) also covered the story.

and the big news out of Proviso

A shoe has dropped in Melrose Park. See Capitol Fax Blog (Rich Miller):

The former chief and six other former and current officers and employees of the Melrose Park Police Department operated the department as an illegal racketeering enterprise for at least a decade between 1996 and 2006, according to a federal grand jury indictment returned today, announced Patrick J. Fitzgerald, United States Attorney for the Northern District of Illinois. The indictment alleges that the former chief, Vito R. Scavo, and other defendants defrauded west suburban Melrose Park and its citizens by using police department personnel and property to operate several private security guard companies and provide personal services to Scavo; extorted village businesses into using security guard services provided by companies that Scavo and others controlled; and that Scavo committed individual and corporate tax fraud and improperly compensated police department employees who performed personal chores for him with compensatory time off that they had not earned. Scavo, who was village police chief from 1995 until he resigned in September 2006, was charged with racketeering conspiracy along with Deputy Police Chief Gary Montino and Michael “Mickey” Caliendo, former civilian supervisor of part-time police officers.

As part of the alleged conspiracy, Scavo and two other defendants, Guy Ric Cervone, a former police lieutenant recently promoted to commander, and German Cepeda, a former police department janitor and current code enforcement inspector for the village, allegedly obstructed a grand jury investigation of their conduct and tampered with potential grand jury witnesses.

Ric Cervone is the VP of the District 89 (Maywood and Melrose Park elementary schools) board of education.