Nearly two dozen people have been charged in Chicago federal court with participating in a macabre, $26 million fraud scheme that supplied phony information to first responders, funeral parlors and cemeteries about recently deceased individuals to illegally collect life insurance payments.
An indictment unsealed in U.S. District Court on Thursday charged a total of 23 people with various counts of mail fraud and wire fraud.
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Among the defendants are married couples and their children, as well as an insurance agent who owned a side business that performed medical exams on life insurance applicants, according to the U.S. attorney’s office.
Most of the defendants were arrested Thursday in Illinois and Florida and are making initial appearances in federal courts in Chicago, Orlando, Tampa, and Miami, according to prosecutors.
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The 34-page indictment also seeks forfeiture of at least $26 million in ill-gotten gains, as well as nine luxury automobiles including two Corvettes, a Mercedes, a Hummer H2 and a GMC Sierra Denali, eight Rolex watches, and properties in the Chicago suburbs of Orland Park, Bridgeview, and Burbank.
According to the indictment, between 2013 and last month, the defendants submitted scores of fraudulent applications to obtain life insurance policies in the names of various people, then tricked the insurance carriers to pay death benefits by changing the identity of a deceased person to match the name on the policy.
The defendants used a variety of means to falsify death certificates, including by lying about a deceased person to law enforcement, first responders, medical personnel, funeral home staff, and cemetery employees, the charges alleged.
Among those charged: James Mills, 47, his wife, Juley Ely, 47, and their daughter, Ginger Ely, 26, all of Oak Lawn. Also charged were Frank Costello, 44, of Hoffman Estates, Mary Bacco, 53, of Bridgeview, Joe Rouga, 29, of Oak Lawn; and Steve Montega, also known as “Fonzie Cerano,” 44, of Orland Park.
Other Chicago-area defendants include: Niko Ristick, 23, and Ricky Blanca, 48, both of Orland Park; Mark Blanca, 30, of Burbank; and Joe John, 66, of Arlington Heights.
Each of the fraud counts is punishable by up to 20 years in federal prison.
jmeisner@chicagotribune.com
