Illinois State Police officers accused of PPP loan fraud

Sun-Times files

Two Illinois State Police officers from the Chicago area are suspected of defrauding the federal Paycheck Protection Program that provided loans to businesses struggling during the COVID-19 pandemic.

On their loan applications, one said he ran a sports program for kids, listing “babysitting” as the primary purpose for his business. The other said he was a “handyman.”

The agency has filed complaints against the officers with the Illinois State Police Merit Board, which metes out discipline.

The state police provided the complaints to the Chicago Sun-Times under a Freedom of Information request but denied a request for other documents, including personnel records and disclosures of secondary employment.

The agency said the denial was based on “active criminal investigations.”

“The agency anticipates conducting criminal interviews in furtherance of these investigations. Releasing any further information at this time could compromise the integrity of ISP's investigation,” the agency said in a letter.

The letter didn’t mention the Sun-Times’ request for documents involving a third officer, a former district commander who, according to public records, also appears to have obtained a PPP loan.

Asked about that Friday, a state police spokesperson said, “ISP does not pursue administrative proceedings against those who have retired” and doesn’t comment on active investigations.

The federal PPP program, operated by the Small Business Administration, was rife with fraud involving at least $200 billion in ill-gotten loans, according to the government’s own estimates. The loans were forgivable, meaning they often didn’t have to be repaid.

Hundreds, if not thousands, of local public employees, including Chicago cops, firefighters, teachers and others, are suspected of defrauding the program, according to investigations by inspector generals who oversee those agencies. Some have been fired but few have been charged with crimes.

Even people locked up in jails and prisons got in on the act.

The allegations against the two state police officers are particularly significant because the agency is held out as a gold standard of policing.

In the Chicago area, suburban police agencies turn to the state police to conduct independent investigations of police-involved shootings involving their departments. The state police might take over that role for the Chicago Police Department, too.

The complaints against the officers — whom the Sun-Times isn’t naming because they haven’t been disciplined or criminally charged — say they were interviewed by the Illinois Office of the Executive Inspector General.

One admitted he lied on an application for a PPP loan, according to the complaint filed against him with the merit board. The "master trooper," who lives in Kendall County, has been employed with the state police since 2006. He could not be reached for comment.

He submitted an application for a PPP loan on March 29, 2021, saying he was an independent contractor. He got a loan for $17,707, which was later forgiven.

His PPP application listed “babysitting” as his principal business with gross income of $85,000 in 2020. He said his expenses included $30,000 in contract labor, $20,000 on advertising, the same amount for a car and truck, $10,000 for an office and $5,000 for repairs.

The master trooper, in his interview with the inspector general’s office, said he ran a sports camp for kids from November 2020 to about November 2021. He said he took them to a park to train them and provide them with snacks.

He said he thought the PPP program was intended to provide startup money for existing businesses struggling during the pandemic — though it was actually intended to cover payroll costs, hire back laid-off workers and pay for overhead expenses.

During the interview, though, he admitted the $85,000 in income he reported was from his state police job and not his side business. He said the expenses he reported were false, according to the complaint filed with the merit board.

The other officer — a special agent, or detective, assigned to the Chicago district — lives in DuPage County and has been with the state police since 2018. He declined to comment.

On his March 8, 2021, loan application, he said he was a “handyman” who took in $100,000 in gross receipts in 2020. He got a loan for $20,832, which also was forgiven.

In an interview with the inspector general’s office, he said the $100,000 in gross income he reported included his salary from the state police.

But if his 2020 state police salary were subtracted from that $100,000 figure, that would leave only $1,500 in income from his handyman business, according to the complaint filed with the merit board.

That would be far short of the money the business would have needed to bring in to qualify for a loan.

According to the complaint, the special agent told the inspector general’s office that he used his PPP loan to furnish his home and repair properties he and his relatives own.