Former Sen. Sam McCann accused of campaign fund fraud, money laundering, tax evasion

Illinois

SPRINGFIELD, Ill. (WCIA) — A grand jury has indicted a former Illinois State Senator and gubernatorial candidate on charges of fraud, money laundering, and tax evasion.

A press release from U.S. Attorney John C. Milhiser, Central District of Illinois, says from May 2015 to June 2020 former Sen. Sam McCann allegedly engaged in a scheme to convert over $200,000 in campaign donations to pay himself and make personal purchases. Additionally, the charges accused him of concealing his fraud from donors, the public, the Illinois State Board of Elections, and law enforcement.

WCIA was the first to report that McCann was under federal investigation in April 2019.

Most of his campaign funding in his third party bid for governor in 2018 came from the International Union of Local Operating Engineers 150, a labor union closely aligned with former House Speaker Michael Madigan. 

Our December 2019 investigation of McCann’s ‘Conservative Party’ expenses showed $168,665 in secret payroll expenses, which a spokesman for the State Board of Elections described as “illegal.”

He previously lived in Carlinville and owned and operated two construction related businesses, the release says.

Prosecutors say McCann organized several political committees that were registered with the Illinois State Board of Election. They include:

  • Sam McCann for Senate
  • Sam McCann for Senate Committee
  • McCann for Illinois
  • Conservative Party of Illinois

The indictment states that McCann and his political committees took in over $5 million in campaign donations from April 2011 to November 2018. Furthermore, it says there were several instances when he used the funds to buy personal cars and RVs, pay off personal debts and mortgage payments, and directly pay himself.

Specific examples include:

  • McCann allegedly used over $60,000 in campaign funds to partially pay for a 2017 Ford Expedition in April 2017 and a 2018 Ford F-250 truck in July 2018, per the indictment.
    • Investigators say the cars were titled in his own name and used for his personal travel.
    • They add McCann used campaign funds for loan payments on the F-250 and for fuel and insurance expenses for both cars, while at the same time using campaign funds to reimburse mileage expense claims which he did not incur.
  • In April 2018 McCann used $18,000 in campaign funds to purchase a 2018 RV trailer, the indictment says. It was titled in his name.
  • In May 2018, he used $25,000 in campaign funds to buy a 2006 RV motor home, also titled in his name.
  • The release says McCann signed up for an online account with an RV rental business in Ohio and put up the vehicles for rent. He had registered as the owner using his name.
  • Prosecutors say he then created a second account with the same rental business, this time using the name ‘William McCann’, and posed himself as a potential renter.
    • The indictment says he used a different residential address and email than those he listed as the owner.
  • Between May 2018 to June 2018, McCann rented both the travel trailer and motor home from himself through the RV rental business, according to the indictment.
  • Prosecutors say he billed $62,666 in campaign funds towards the rental cost of the vehicles.

“The rental business retained approximately $9,838 for commission and paid McCann, as the owner, approximately $52,827 by direct deposit to McCann’s personal checking account,” says the release. “McCann reimbursed the campaign accounts $18,000, resulting in more than $77,000 in campaign funds used to buy and rent from himself.”

  • In early October 2016, prosecutors say McCann used a $20,000 cashier’s check to pay himself from his campaign account and used it to make payments on a personal loan, including legal fees.
    • The loan had originally been given to him as an equipment loan in 2011 and was under collections by the bank due to non-payment, the release says.
  • From May 2015 to August 2020, McCann allegedly used campaign funds to pay about $64,750 on two separate personal mortgage loans that were secured by his former residence in Carlinville and an adjoining property used as an office for his construction business.
  • From November 2018 to June 2020, McCann allegedly caused the Conservative Party of Illinois to issue approximately $187,000 in payments to himself personally and an additional $52,282 in payments for payroll taxes.
    • Prosecutors say this took place after an unsuccessful campaign for Governor of Illinois: He was no longer a candidate for office and did not financially support any other candidate.
    • Using a payroll service, investigators say McCann concealed himself as the payee for the expenditures from the campaign account.
  • The indictment also accuses him of using $50,000 in campaign funds for personal expenses, which includes Green Dot credit card payments related to a family vacation in Colorado and other personal expenses, charges from Apple iTunes, Amazon, a skeet and trap club, Cabela’s, Scheels, Best Buy, a gun store, and cash withdrawals.

In addition to wire fraud and money laundering, prosecutors charged McCann with one count of tax evasion related to his joint return for 2018.

The release says McCann failed to report income from his 2018 rental payments to himself for the RV trailer and motor home. Additionally, McCann used a $10,000 check issued in March 2018 by a campaign account to make a down payment to a Shipman business for a motor home.

” When the purchase was not completed, the business issued a $10,000 refund check payable to William McCann, which he deposited to his personal checking account and failed to report as income received,” says the release.

McCann is scheduled to appear via telephone conference on Feb. 16, 2021, at 2:00 p.m. before U.S. Magistrate Judge Tom Schanzle-Haskins for arraignment.

“For the period of the alleged fraud scheme, from May 2015 to June 2020, the estimated loss is more than $200,000,” the release says.

If convicted, the statutory penalty for each count of wire fraud (seven counts) and one count of money laundering is up to 20 years in prison. For tax evasion, the statutory penalty is up to five years in prison.

The charges are the result of an investigation by the FBI and IRS Criminal Investigation. Assistant U.S. Attorney Timothy A. Bass is representing the government in the prosecution.

The indictment was announced by Central District of Illinois U.S. Attorney John C. Milhiser, FBI Special Agent in Charge Sean M. Cox, Springfield Division, and IRS Criminal Investigation Acting Special Agent in Charge David Talcott, St. Louis Field Office.

“Members of the public are reminded that an indictment is merely an accusation; the defendant is presumed innocent unless proven guilty.”

Copyright 2021 Nexstar Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

Trending Stories