Segal Imprisoned Pending Sentencing

By Mark E. Ruquet

NU Online News Service, June 24, 4:28 p.m. EDT?A federal judge in Chicago has revoked the bond of Near North founder Michael Segal and ordered him jailed following his conviction by a jury Monday on embezzlement and related charges.[@@]

Federal Judge Ruben Castillo revoked Mr. Segal’s $750,000 bond and ordered him to prison after agreeing with prosecutors that he posed a flight risk.

Prosecutors argued that because of the lengthy sentence he is facing, his age and change in his circumstances in life, there was an increased possibility he would flee to avoid a possible 20 years in prison, said Randall Samborn, a spokesman for the U.S. Attorney in the Northern District of Illinois.

In addition to the potential of a 20-year prison term, he also faces forfeiture of millions of personal funds.

The jury that convicted him was asked to determine how much of Mr. Segal’s assets should be forfeited as ill-gotten gains from the embezzlement scheme. Prosecutors asked for $35 million. The jury came back with a verdict on Tuesday that he should forfeit $30 million and 60 percent stock ownership in Near North.

Mr. Samborn said prosecutors view the jury’s decision as advisory. He said prosecutors are seeking 100 percent of Mr. Segal’s interest in Near North in addition to the $30 million as part of the forfeiture.

Mr. Segal was convicted of 26 counts stemming from the embezzlement of more than $20 million from Near North’s premium trust fund account over a 12 year period. The counts include three of embezzlement, 13 counts of mail fraud, seven counts of making false statements, one count of wire fraud, one for tax fraud conspiracy and one count for racketeering.

Near North, which was tried with Mr. Segal, was convicted on 21 counts include 11 counts of mail fraud, seven of making false statements and three of embezzlement.

The firm faces 5 years probation and fines.

Judge Castillo granted the defense 60 days in which to file an appeal. No date for sentencing has been set.