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Developer Faces 230 Years in Prison

Wednesday, March 16, 2016

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The president of a well-known Chicago-based real estate firm has been convicted of swindling banks and the city out of millions of dollars relating to the redevelopment of a former Goldblatt’s department store and other projects, authorities announced.

Laurance “Larry” H. Freed, 53, the president of Joseph Freed & Associates LLC, was convicted by a federal jury Feb. 24 following a two-week trial.

He had been accused of bank fraud, mail fraud and making false statements relating to a $105 million line of credit, according to U.S. Attorney’s Office for the Northern District of Illinois.

cash
©iStock.com / Terminator3D

"This crime began because [Larry Freed] had a large financial empire and was overextended at a time when the real estate market was crashing,” Renato Mariotti, the lead prosecutor on the case, told the Chicago Tribune.

He faces a maximum sentence of 230 years in prison, prosecutors said.

Freed is scheduled for a status hearing on March 24. His sentencing has not yet been scheduled.

VP Pleads Guilty

Earlier in February, JFA’s vice president Caroline Walters, 55, pleaded guilty to one count of making a false statement to a financial institution. Her conviction carries a maximum sentence of 30 years behind bars.

Her sentencing hearing has been set for June 10.

Case Details

During Freed’s trial, prosecutors told jurors that Freed double-pledged city-issued financial notes, worth $6.7 million, to two different banks as collateral. The city had initially issued the notes to Freed to redevelop the former Goldblatt’s department store in the city’s Uptown neighborhood.

Freed also was accused of withdrawing more than $7 million from the Streets of Woodfield Mall development in Schaumburg, without the knowledge or consent of his business partner Kimco Realty Corp., and fraudulently recorded the money as loans, prosecutors said.

Sullivan
Chicago Architecture Today via Flickr / CC By 2.0

The firm is credited with developing the Sullivan Center, a Chicago landmark formerly known as the Carson Pirie Scott building.

“This crime began because he had a large financial empire and was overextended at a time when the real estate market was crashing,” Renato Mariotti, the lead prosecutor on the case, told the Chicago Tribune.

“He was running out of cash, and was willing to do things that were illegal to get that cash.”

About the Firm

JFA was founded in 1965 by Freed’s father, with a single retail property, according to its website.

The company grew to have 24 million square feet of retail, residential, and office space and over 4,000 single- and multi-family residential units in over 50 projects, the website notes.

The firm is credited with developing the Sullivan Center, a Chicago landmark formerly known as the Carson Pirie Scott building.

JFA and Freed have not commented on the outcome of the case.

   

Tagged categories: Business conditions; Business matters; Criminal acts; Developers; Fraud; Historic Structures; Renovation

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