Lawyers charged with stealing from Johnson Controls

A former tax attorney for Johnson Controls International, along with a lawyer in Michigan, have been charged with stealing more than $4 million from the Glendale-based company via phony legal bills.

Scott C. Hess, 53, of Menomonee Falls, and Craig Hilborn, 55, of Birmingham, Mich., each face two counts of wire fraud for payments from JCI’s bank to Hilborn’s law firm’s account, in November 2014 and June 2015.

But the embezzlement scheme actually began in 2000 and stretched over 15 years, according to the criminal information filed Friday in Milwaukee federal court.

Charging by information, rather than complaint or indictment, usually indicates defendants’ lawyers have been negotiating with federal prosecutors. But no plea agreement has been filed and no court dates have been set.

Fraser Engerman, a spokesman for JCI, said the company discovered the fraud during an internal investigation.

“The company cooperated with the FBI and U.S. attorney as the investigation was conducted and we are appreciative of their efforts to resolve the case,” Engerman said. “Doing business with integrity is the only way Johnson Controls does business and we hold all employees accountable to act in an ethical and legal manner.”

According to the information: Hess would create fake invoices reflecting legal work purportedly done for JCI by Hilborn’s law firm, Hilborn & Hilborn. As senior corporate tax counsel, Hess would approve payment of the invoices by JCI.

When Hilborn received the payments, he’d send two thirds back to Hess.

Hess is not a member of the Wisconsin bar. He was admitted to the State Bar of Michigan in 1992, the year he graduated with a master’s degree in tax law from the University of Florida. He received his law degree from Michigan State University College of Law in 1989.

Hilborn & Hilborn’s Facebook page indicates the firm specializes in personal injury and product liability. It was formed in 1993 when Craig Hilborn, who also earned his law degree at Michigan State, joined his father in practice.