Only the people directly involved in the bid-rigging scheme of former Madison County Treasurer Fred Bathon will be on the hook for reimbursing people who were cheated, an appeals court has decided.
The 5th District Appellate Court in Mount Vernon has ruled that Madison County will be removed as a defendant from a class-action lawsuit brought by people who were defrauded in a scheme to rig the bidding process for delinquent property taxes under Bathon’s tenure as treasurer.
Bathon served 18 months in federal prison for rigging Madison County tax auctions at the highest interest rates to benefit the tax buyers, some of whom also went to prison. Several people who lost money or property to the scheme filed a class-action lawsuit against the county and many others, including Bathon, in an attempt to recoup their losses.
Among the defendants was Madison County itself, which would have required that taxpayer money would be spent to reimburse the victims. That was applauded by current Treasurer Kurt Prenzler, who is running for county board chairman opposite incumbent Chairman Alan Dunstan, who opposed it.
“Only the criminal co-conspirators who profited from this conspiracy, several of whom served prison sentences for this crime, should be made responsible for restitution to the victims,” Dunstan said. “Taxpayers should not have to pay the bill for corruption by tax buyers and their co-conspirator, the former treasurer. With this decision by the court, Madison County officials again have been exonerated of any liability and we now have saved taxpayers from having to potentially pay millions of dollars in damages.”
Prenzler said he believes the county should pay the victims first, and then seek reimbursement from Bathon and his co-conspirators.
“It’s been more than 10 years since the first crooked tax sale,” Prenzler said. “The victims lost more than $4 million — and that doesn’t count those who lost their homes — and they have not received one dollar in restitution. Those swindled were struggling families who could not pay their taxes on time. This scheme to benefit Democrat campaign contributors preyed on the weak. My goal has always been to see that these people receive restitution.”
Dunstan said he believes using taxpayer money to repay Bathon’s victims would have been “reckless” and “a jackpot for the lawyers.”
“Had we followed Mr. Prenzler’s plan, Madison County taxpayers would have, in effect, been paying for the corruption in the treasurer’s office when the blame and responsibility for restitution belongs to the criminal co-conspirators who secretly rigged the tax sales. Obviously, the court agrees,” Dunstan said. “The Appellate Court confirmed what we have been saying since this case was initially filed, the parties directly involved in this criminal conspiracy are responsible, and not Madison County government, or its public officials, nor the citizens of Madison County.”
Bathon’s scheme forced 10,000 Madison County property owners into paying excessive interest rates and penalties from 2005-09 on delinquent taxes. Bathon pleaded guilty in January 2014 to a federal bid-rigging charge and was sentenced to 30 months in prison, of which he served 18 months.
Taxbuyers John Vassen, Scott McLean and Barrett Rochman were sentenced to terms ranging from 16 months to two years at a minimum security federal prison camp. The guilty pleas and subsequent lawsuits occurred more than three years after an investigative series by the Belleville News-Democrat exposed Bathon’s scheme.
Prenzler has previously argued that the county could put the money saved from Bathon’s pension — which he lost as a result of his felony conviction — with other funds to pay for the lawsuit. But Madison County State’s Attorney Tom Gibbons has said such use of those funds is illegal.
A year ago, the appellate court allowed the case to become a class action, and included Madison County as a defendant. However, they left a window for the county to pursue removal as a separate appeal, Gibbons said.
“The best thing is that the taxpayers aren’t on the hook here,” Gibbons said. “We have established what we’ve said all along: the responsibility does not lie with taxpayers. Don Weber and these attorneys are trying to make money off the taxpayers when there’s a group of people clearly responsible for this, who went to prison for it. I expected and hoped the court would rule this way.”
Gibbons said the case will now move forward against Bathon and the tax buyers, though the plaintiffs could appeal to the Illinois Supreme Court. However, he said he believes the appellate court’s ruling was well-argued. “I’m confident this decision will stand,” he said.
Weber, who represents the plaintiffs, is a political ally of Prenzler. He said he is now “only marginally involved” in the case, but criticized Gibbons and the county for fighting the class-action suit.
“I think the county needs to take some action to make sure these criminals don’t get to keep the $4-5 million they stole,” Weber said. “I thought (Gibbons) should have directed his efforts toward recovering the money … the county should have been pursuing the criminal defendants all along.”