The investigation of what happened at Washington Federal Bank is front and center. Feds are determined to trace every dime.
- How many millions did this bank lose?
- Who got loans from this bank?
- Who's loans were not performing?
- What was the nature of the relationship between the bank's auditor and the 11th Ward Regular Democratic Organization?
- What other banks did this Auditor represent?
- Was the bank paying commissions for loans?
This is a strange story
Ald. Patrick Daley Thompson under scrutiny in probe of failed Bridgeport bank
An $80,000 loan that Ald. Patrick Daley Thompson got for work on the 11th Ward Regular Democratic Party Organization's headquarters after it was cited for violations of the city code is now part of a broadening federal probe of failed Washington Federal Bank for Savings that also includes the Bridgeport bank president's hanging 12 days before the bank was ordered closed in 2017. | Rich Hein / Sun-Times
By Tim Novak and Robert Herguth
Two years ago, city of Chicago inspectors showed up at the Daley family’s longtime political headquarters, a stout brick structure in Bridgeport that houses offices for Cook County Commissioner John P. Daley, his nephew Ald. Patrick Daley Thompson and the 11th Ward Regular Democratic Organization they control.
Spurred by a neighbor’s complaint about loose bricks, the inspectors discovered code violations at the building at 3659 S. Halsted St. that required costly repairs including exterior brickwork, new drywall and the removal of plumbing fixtures and wiring, city records show.
To pay for that, Thompson turned to a neighborhood bank, Washington Federal Bank for Savings. He
got an $80,000 loan, unsecured by any collateral, that was deposited into the 11th Ward campaign fund that’s controlled by Daley.
Thompson got the loan in October 2017, as federal regulators were turning up financial irregularities at Washington Federal.
Within two months, the bank president would be found hanged at a customer’s home in a death ruled a suicide. And authorities would shut down the bank over millions of dollars in unaccounted-for loans — losses that now total at least $80 million, according to the Federal Deposit Insurance Corp.
Thompson’s loan is now part of a broadening federal investigation that began with the missing money — including loans made without any collateral — and also includes the death of bank president John F. Gembara 12 days before the bank was ordered closed, the Chicago Sun-Times has learned.
Thompson is the third sitting alderman who is under federal investigation. The two others — Ald. Edward M. Burke (14th) and Ald. Danny Solis (25th) — are involved in a separate investigation in which Burke has been charged with trying to shake down a Burger King operator for legal business.
Thompson, 49, refused interview requests and would not answer questions about the terms of the loan — including the interest that would be charged, when the money needed to be repaid and why there was no collateral.
Daley told the Sun-Times he would try to provide those answers but didn’t.
The 11th Ward Regular Democratic Organization headquarters at 3659 S. Halsted St. | Kevin Tanaka / Sun-Times
Through records and interviews, the Sun-Times also found that:
• The 11th Ward organization made no payments to Washington Federal before it was shut down in December 2017. The bank’s collateralized loans were taken over by another Chicago bank, Royal Bank for Savings. That didn’t include unsecured loans like the one Thompson got for the party’s ward headquarters. That $80,000 debt later was taken over by Royal under a five-year loan at 5 percent interest. It’s unclear if those were the same terms Thompson got from Gembara’s bank. The 11th Ward Democrats started repaying the money last June. It has repaid about $8,000 and made $5,100 in interest payments, campaign records show.
• Bansley & Kiener, an auditing firm that has long worked for the Daley family’s political funds, did the books for Washington Federal. It gave the bank a clean financial bill of health during annual reviews — the most recent completed five months before the bank was shut down. The firm also handles 11th Ward finances and has made campaign contributions to the Daleys. A federal judge recently ordered the company to turn over its records on the failed bank to the FDIC.
• Thompson also has faced personal financial troubles involving bank loans. He was an elected board member of the Metropolitan Water Reclamation District of Greater Chicago in January 2014 when he was sued by another Bridgeport lender, North Community Bank, which said he failed to repay an $88,000 loan on a home he and his wife owned in the neighborhood. The loan was overdue for three years when the bank sued, saying Thompson owed $88,000 in principal, $17,208 in interest and $1,738 in late fees. The bank dropped the lawsuit a month later but kept a lien on the house until the Thompsons sold it 2017.
• Over the past five months, Thompson and his wife Kathleen have gotten $704,000 in mortgages from Morgan Stanley Private Bank. A day before last Thanksgiving, they refinanced the Bridgeport bungalow where they now live — the home where Mayor Richard J. Daley, his late grandfather, raised his family. The Thompsons got a $454,000 mortgage on that house. Two weeks later, they got a $250,000 mortgage from Morgan Stanley on their second home, in New Buffalo, Michigan. According to the loan documents, Thompson’s wife “is not assuming liability for payment” of either mortgage.
READ MORE
• Why did Bridgeport bank president kill himself in customer’s Park Ridge home? March 4, 2018
• After Bridgeport banker found dead, top debtor tries to avoid repaying $20M, April 8, 2018
• Feds find massive fraud at shuttered Bridgeport bank whose president was found dead, Nov. 9, 2018
An $80,000 loan that Ald. Patrick Daley Thompson got for work on the 11th Ward Regular Democratic Party Organization's headquarters after it was cited for violations of the city code is now part of a broadening federal probe of failed Washington Federal Bank for Savings that also includes the Bridgeport bank president's hanging 12 days before the bank was ordered closed in 2017. | Rich Hein / Sun-Times
By Tim Novak and Robert Herguth
Two years ago, city of Chicago inspectors showed up at the Daley family’s longtime political headquarters, a stout brick structure in Bridgeport that houses offices for Cook County Commissioner John P. Daley, his nephew Ald. Patrick Daley Thompson and the 11th Ward Regular Democratic Organization they control.
Spurred by a neighbor’s complaint about loose bricks, the inspectors discovered code violations at the building at 3659 S. Halsted St. that required costly repairs including exterior brickwork, new drywall and the removal of plumbing fixtures and wiring, city records show.
To pay for that, Thompson turned to a neighborhood bank, Washington Federal Bank for Savings. He
got an $80,000 loan, unsecured by any collateral, that was deposited into the 11th Ward campaign fund that’s controlled by Daley.
Thompson got the loan in October 2017, as federal regulators were turning up financial irregularities at Washington Federal.
Within two months, the bank president would be found hanged at a customer’s home in a death ruled a suicide. And authorities would shut down the bank over millions of dollars in unaccounted-for loans — losses that now total at least $80 million, according to the Federal Deposit Insurance Corp.
Thompson’s loan is now part of a broadening federal investigation that began with the missing money — including loans made without any collateral — and also includes the death of bank president John F. Gembara 12 days before the bank was ordered closed, the Chicago Sun-Times has learned.
Thompson is the third sitting alderman who is under federal investigation. The two others — Ald. Edward M. Burke (14th) and Ald. Danny Solis (25th) — are involved in a separate investigation in which Burke has been charged with trying to shake down a Burger King operator for legal business.
Thompson, 49, refused interview requests and would not answer questions about the terms of the loan — including the interest that would be charged, when the money needed to be repaid and why there was no collateral.
Daley told the Sun-Times he would try to provide those answers but didn’t.
The 11th Ward Regular Democratic Organization headquarters at 3659 S. Halsted St. | Kevin Tanaka / Sun-Times
Through records and interviews, the Sun-Times also found that:
• The 11th Ward organization made no payments to Washington Federal before it was shut down in December 2017. The bank’s collateralized loans were taken over by another Chicago bank, Royal Bank for Savings. That didn’t include unsecured loans like the one Thompson got for the party’s ward headquarters. That $80,000 debt later was taken over by Royal under a five-year loan at 5 percent interest. It’s unclear if those were the same terms Thompson got from Gembara’s bank. The 11th Ward Democrats started repaying the money last June. It has repaid about $8,000 and made $5,100 in interest payments, campaign records show.
• Bansley & Kiener, an auditing firm that has long worked for the Daley family’s political funds, did the books for Washington Federal. It gave the bank a clean financial bill of health during annual reviews — the most recent completed five months before the bank was shut down. The firm also handles 11th Ward finances and has made campaign contributions to the Daleys. A federal judge recently ordered the company to turn over its records on the failed bank to the FDIC.
• Thompson also has faced personal financial troubles involving bank loans. He was an elected board member of the Metropolitan Water Reclamation District of Greater Chicago in January 2014 when he was sued by another Bridgeport lender, North Community Bank, which said he failed to repay an $88,000 loan on a home he and his wife owned in the neighborhood. The loan was overdue for three years when the bank sued, saying Thompson owed $88,000 in principal, $17,208 in interest and $1,738 in late fees. The bank dropped the lawsuit a month later but kept a lien on the house until the Thompsons sold it 2017.
• Over the past five months, Thompson and his wife Kathleen have gotten $704,000 in mortgages from Morgan Stanley Private Bank. A day before last Thanksgiving, they refinanced the Bridgeport bungalow where they now live — the home where Mayor Richard J. Daley, his late grandfather, raised his family. The Thompsons got a $454,000 mortgage on that house. Two weeks later, they got a $250,000 mortgage from Morgan Stanley on their second home, in New Buffalo, Michigan. According to the loan documents, Thompson’s wife “is not assuming liability for payment” of either mortgage.
READ MORE
• Why did Bridgeport bank president kill himself in customer’s Park Ridge home? March 4, 2018
• After Bridgeport banker found dead, top debtor tries to avoid repaying $20M, April 8, 2018
• Feds find massive fraud at shuttered Bridgeport bank whose president was found dead, Nov. 9, 2018
Next shoe to drop. Bet on it.
ReplyDeleteChicago is the swamp. dark to light
ReplyDeletePatrick Daley Thompson is a good man.
ReplyDeleteI'm sure the Daley Mafia will soon put an end to this investigation. There will magically appear a scapegoat to let everyone else off the hook
ReplyDeleteIs Daley his middle name or his Maiden name? Just askin. I often wondered about that.
ReplyDeleteThompson was middle named with his mom's maiden name.
ReplyDeleteThanks for the middle name insight. It sounds Kennedyesque. Makes sense in the political workd I guess.
Delete