Chinatown developer pleads guilty to fraud charge
A Chinatown developer who wore a wire on former Ald. Daniel Solis and helped theFBIbreak opena sweeping political corruption probe pleaded guilty Friday to wire fraud related to a South Side condominium project.
See Y. Wongwas charged in a seven-page criminal information in March for allegedly lying to banks and buyers involved with his Canal Crossing building, records show.
He pleaded guilty Friday during a hearing held via video conference beforeU.S. District Judge Charles Norgle. Before the details of the plea were discussed, the judge asked Wong if he felt well and had eaten any breakfast.
“I just had a cup of coffee,” Wong said. When the judge later asked him what his plea was, Wong replied, “Guilty, yourhonor.”
Preliminary sentencing guidelines called for up to about 5 years in prison. Under the terms of Wong’s plea agreement, though, prosecutors intend to ask for a sentence of only 2years behind bars if he continues to cooperate.
The 20-page plea agreement does not specifically mention the Solis probe, but calls on Wong to provide “complete and truthful” information in any investigation and testify if necessary.
Wong agreed to have his sentencing delayed until his cooperation is complete. Norgle set a status hearing in the case for Feb. 5.
Wong began cooperating with the FBI in May 2014 afterhewas caughtupinthe fraud scheme and agreed to secretly record Solis in hopesof receiving a reduced sentence once he was charged, according to a federal searchwarrant affidavit unsealed in 2019.
While Wong was not named in the affidavit, sources with knowledge of the probe confirmed his identity to the Tribune.
Wong’s cooperation helped lead Solis in turn to wear a wire for the FBI for twoyears, recordingnumerous conversations with then-powerful Ald. Edward Burke, the Tribune has previously reported. Burke has since been charged in a sweeping corruption indictment alleging he tried to shake down business owners seekinghelp at CityHall.
The search warrant affidavit, which was filed in 2016, revealed that Wong also secretly recorded a meeting in August 2014 with Solis, House Speaker Michael Madigan and representatives of a Chinatown hotel project at Madigan’s law firm, Madigan & Getzendanner, which specializes in real estate tax appeals.
“Well, our interest would be that we represent buildings like that on the real estate taxes … and we do quite a few hotels,” the affidavit quotedMadigan as saying. “And, uh, we have a little different approach to representation on hotels than the other lawfirms that do thework.”
Madigan said he was interested in representing the businessman in other projects aswell.
“We’re not interested in a quick killing here,” Madigan allegedly said. “We’re interested in a long-term relationship.”
Madigan has denied any wrongdoing and has not been charged.
The charges against Wong revolve arounda $13.7 million loan that Wong’s company, Emerald Homes LLC, took out in 2007 — at the cusp of recession that would rock Chicago’s real estate market — to fund construction of the 60-unit CanalCrossingcondobuilding on South Canal Street.
According to the charges, Wong promised to sell units at steep discounts if money was paid up front without waiting for a building to be completed. He did so without the consent of the bank, and used some of the buyers’ funds to pay personal loans and other costs instead of depositing it into an escrow account as required, according to the charges.
When the lender, Cathay Bank, found out about the discounted sale prices, it invoked liens held on the properties to force the new homeowners to pay the remainder of the purchase price before they could close on the property, according to the document.
In all, the scheme cost Los Angeles-based Cathay Bank about $1.7 million and buyers a total of about $1 million, the charges alleged.
The 120-page affidavit filed in the Solis investigation, meanwhile, revealed the FBI spent more than two years secretly listening in on thousands of phone calls as the alderman solicited everything from campaign donations to erectile dysfunction medication and sexual services at amassage parlor.
Solis abruptly retired from the City Council in January 2019 before the document became public.
Earlier this year, attorneys for Burke revealed in a court filing that Solis had entered into a deferred prosecution agreementwith the U.S. attorney’s office, meaning he may never face criminal prosecution.