Introduction to the Case

A Chicago contractor who made $14.3 million in an embezzlement scheme that tanked a politically connected Bridgeport bank was sentenced Thursday to 5½ years in prison.

Background of the Scheme

Boguslaw Kasprowicz could have faced twice as much time for his role in the Washington Federal Bank for Savings fraud, but he “provided substantial assistance” to federal prosecutors by testifying against major players in the case — including his brother-in-law. Kasprowicz, 67, pleaded guilty in 2022 to helping embezzle $66 million from the century-old Polish community bank in Bridgeport, which came to serve as a massive slush fund for a clouted selection of customers, leading to its failure in 2017, prosecutors said.

Details of the Embezzlement

He collected $14.3 million in checks from the bank to his construction company over more than a decade, far beyond the mortgages taken out by his construction company to develop and sell homes, prosecutors said. And he was never expected to pay anything back. Kasprowicz used the money for cars and cosmetic dental work, as well as tuition for one of his children to pursue an acting career and another to study medicine in Poland, prosecutors said.

Involvement with Bank Officials

Kasprowicz would also drive the bank’s president, John Gembara, for errands, prosecutors said, and he used embezzled funds to pay off Gembara’s credit card bills and personal loans that were used in part to pay for a yacht. Gembara was found dead with a rope around his neck in a customer’s bedroom two weeks before federal regulators shut down the bank. Authorities ruled it a suicide, but Gembara’s widow, her attorney and others said they suspect foul play.

Sentencing and Cooperation

Chief Judge Virginia Kendall said she agreed with a reduced sentence recommended by prosecutors because he admitted guilt and cooperated with the government, unlike other defendants in the saga who “continually pointed the finger at a dead man for all responsibility.” “You would be in a very, very different place right now if you didn’t do that,” Kendall said.

Defense and Apology

Defense attorney Adam Sheppard had asked for a four-year sentence, arguing Kasprowicz “is not an outright scammer. He didn’t dream up this scheme.” Kasprowicz, who also pleaded guilty to cheating on his taxes, apologized in court, saying, “I never knew the unpaid loans would cause the bank to fail.” “I’m just trying to ask the investors for forgiveness,” he said of Washington Federal depositors who lost millions of dollars. The Federal Deposit Insurance Corp. had to cover $90 million in losses, most of which remain unaccounted for.

Related Cases and Indictments

The owner of the home Gembara died in, Marek Matczuk, was previously convicted of embezzling $6 million from the bank. Kasprowicz testified against him, as well as Robert Kowalski — a close friend of Gembara who made $8 million in the scheme — and developer Miroslaw Krejza, Kasprowicz’s brother-in-law, who collected $2.6 million. Kowalski drew Kasprowicz into the scheme, according to Sheppard. The scheme has led to more than a dozen federal indictments, ensnaring former 11th Ward Ald. Patrick Daley Thompson, the grandson and nephew of two former Chicago mayors.

Notable Figures Involved

Thompson was convicted of lying to regulators about the $219,000 he owed the bank and for cheating on his income taxes. He served four months and is now a registered lobbyist at City Hall. William Mahon, a former high-ranking City Hall official under three former mayors who was part of the Daleys’ 11th Ward Regular Democratic Organization, was on the bank’s board for nearly 20 years, until it collapsed. He pleaded guilty to falsifying documents and was released from prison last month.

Conclusion

Kasprowicz, who previously paid back about $2 million to the bank, also has to pay $12.4 million to the FDIC, plus $3.9 million to the IRS and $480,982 to the Illinois Department of Revenue for his tax crimes. Kendall acknowledged it’s “unrealistic” to think he’ll ever be able to come up with the money.

FAQs

• Q: How much did Boguslaw Kasprowicz make in the embezzlement scheme?
  A: Kasprowicz made $14.3 million in the scheme.
• Q: What is the total amount embezzled from the Washington Federal Bank for Savings?
  A: The total amount embezzled was $66 million.
• Q: How long was Kasprowicz sentenced to prison?
  A: Kasprowicz was sentenced to 5½ years in prison.
• Q: Who else was involved in the scheme and testified against?
  A: Kasprowicz testified against his brother-in-law, Miroslaw Krejza, among others.
• Q: What is the status of the money lost by the bank’s depositors?
  A: The Federal Deposit Insurance Corp. had to cover $90 million in losses, most of which remain unaccounted for.