Scheming Developers Indicted After Costing Chicago Bank $56 Million

April 18, 2010

Two developers who wanted to convert two East Loop office buildings into condominiums have been federally charged with bank fraud after falsely representing dollar amounts to the bank and spending some of the loan money on themselves.

The property at 6 N. Michigan Avenue did finally become a condo building, no thanks to Esmail and Yousif.

According to the FBI, Romel Esmail, 50, and Bassam Haj Yousif, 42, took out loans from 1999 to 2003 from former CIB Bank in west suburban Hillside in order to convert two vintage buildings, at 6 N. Michigan Ave. and 59 E. Van Buren St., into condos. Those loans ultimately caused CIB Bank, which was acquired in 2004 by St. Louis-based First Banks Inc., to lose $56 million.

Esmail and Yousif were each charged with two counts of bank fraud and three counts of making false statements in bank loan documents after the two falsely represented the purchase price of each building, provided the bank with false closing statements as well as documentation reporting work had been done that hadn’t, and personally spent at least $3.6 million on a car, jewelry, real estate and other investments.

U.S. Attorney Patrick Fitzgerald said officials are searching for Esmail, an Iranian citizen formerly from Chicago, who is a fugitive.

Yousif, of Oak Park, is expected to be arraigned at a later date.

Each count of bank fraud and making false statements carries a maximum penalty of 30 years in prison and a $1 million fine, but the court could impose a fine equaling up to twice the loss to the bank.

The property at 6 N. Michigan, which is now a 120-unit condo tower, was built in 1898 as the tallest building in Chicago. The property at 59 E. Van Buren, known as the Buckingham, is used as dorms by Columbia College students during the school year and as short-term apartment rentals during summer.

Esmail and Yousif now have nothing to do with either property.

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