To avoid prison, Chicago movie studio mogul went undercover for feds

SHARE To avoid prison, Chicago movie studio mogul went undercover for feds

Cinespace Chicago Film Studio president Alexander S. “Alex” Pissios and his partners have spent $3.8 million to buy nine properties on the West Side and Southwest Side since he began cooperating with investigators more than two years ago, secretly recording conversations with John Coli Sr., the once-powerful Teamsters union boss who’s now charged with extorting more than $325,000 from the studio. | Provided photo

As president of Chicago’s largest movie studio — home to hit TV shows like “Chicago Fire” and “Empire” — Alexander S. “Alex” Pissios had a difficult choice to make two years ago.

Federal authorities told Pissios he could go to prison for as long as five years over allegations of bankruptcy fraud because he and his wife failed to disclose income he got to help create Cinespace Chicago Film Studios, the Chicago Sun-Times has learned.

Or he could cooperate in an undercover investigation of longtime Chicago Teamsters boss John T. Coli Sr. — the influential union leader who introduced Pissios to powerful Chicago politicians who awarded $31 million in grants and tax breaks to convert a former steel mill into what Cinespace calls the largest movie production facility east of Hollywood.

Pissios agreed to wear a wire, secretly recording Coli, which led to Coli’s indictment last year on charges that he extorted $325,000 from Cinespace — a deal that Pissios told authorities began years ago under his late uncle Nick Mirkopoulos, the Sun-Times has learned.

Coli’s union had separate labor deals with each TV show and movie filmed at Cinespace, and Pissios told federal investigators the payouts bought labor peace at the studio, which opened in 2011.

Coli, free on bail, could face years in prison if convicted.

Pissios appears likely to avoid any criminal charges. He signed a “non-prosecution agreement” that lets him off the hook for failing to tell a bankruptcy judge about a $100,000 bank account he used to support his family and to pay gambling debts while he helped Mirkopoulos expand Cinespace’s operations from Toronto to Chicago, the Sun-Times found.

Pissios began talking with federal authorities in 2016, a few months after a Sun-Times investigation into government funding the studio got, including a $10 million grant that Gov. Pat Quinn’s administration doled out a few weeks after he lost his bid for reelection to Bruce Rauner.

Pissios made his deal with federal prosecutors in March 2017 — nearly six years after his bankruptcy case ended. Coli was arrested about a month later.

The U.S. attorney’s office wouldn’t talk about Pissios’ deal. Asked to comment, lawyers for Pissios and Coli both declined.

Former longtime Chicago Teamsters boss John T. Coli Sr. leaving the Dirksen Federal Building in 2017.

Former longtime Chicago Teamsters boss John T. Coli Sr. leaving the Dirksen Federal Building last July. | Max Herman / Sun-Times

Max Herman/Sun-Times file

Coli’s indictment provides a glimpse into the creation of Cinespace and how it quickly became the largest film, TV and commercial production facility in Chicago, toppling the Credidio family’s Chicago Studio City — which is now suing the state of Illinois for bankrolling its competitor and nearly putting them out of business.

The son of Greek immigrants, Pissios, now 45, was raised in a three-flat on the Northwest Side until his family moved to Morton Grove. Pissios graduated from Maine East High School, later getting his bachelor’s degree in English literature from Northern Illinois University.

After college, Pissios spent a few years selling fur coats at Elan Furs, his uncle’s store on Michigan Avenue. Then, in 2003, he started building townhomes around the United Center with a partner, Edward Gobbo, a nephew of the late William Hanhardt. Hanhardt went to prison for running a mob-tied jewelry theft ring at the same time he was the Chicago Police Department’s chief of detectives.

To get approval from City Hall for their construction projects, Pissios and Gobbo hired zoning lawyer James Banks, whose uncle Ald. William Banks was chairman of the Chicago City Council Zoning Committee. A few years later, James Banks would start Belmont Bank & Trust, a small bank on the Northwest Side that later helped bankroll Cinespace.

But things were tough when Pissios was in construction. Within five years, his northwest suburban home in Hawthorn Woods was in foreclosure, and his home-building business was on the skids.

Then, in 2009, he became an investor in his uncle’s plan to start a movie studio in Chicago. To help Pissios support his family, authorities found that his uncle Nick opened a $100,000 account at Pan-American Bank — the money prosecutors believe Pissios failed to disclose when he declared bankruptcy in January 2011.

Pissios and his wife told the bankruptcy court their debts totaled between $10 million and $50 million, including several mortgages that were in foreclosure, credit-card bills and a variety of fines to City Hall. Their assets were worth between $500,000 and $1 million, according to the statements they gave the court. They reported an income of $55,481 the previous year.

While Pissios was in bankruptcy, Cinespace landed its first state grant from the Quinn administration — $5 million to help buy part of the former Ryerson Steel plant at 16th and Rockwell in North Lawndale. Altogether, Cinespace ended up getting five state grants totaling $27.3 million, arranged with the help of Coli and lobbyist Frank Cortese, according to sources and records.

Pissios told authorities that Cortese, a longtime lobbyist for Coli’s union, began working for Cinespace at Coli’s suggestion. Cortese still works for the union and the studio, state records show.

Pissios told authorities Coli introduced him to Quinn and other Democratic officials — Illinois House Speaker Michael J. Madigan, Illinois Senate President John Cullerton and Mayors Richard M. Daley and Rahm Emanuel, all who have gotten campaign contributions from unions and organizations under Coli’s control, in Quinn’s case more than $560,000 between 2010 and 2014. Madigan spokesman Steve Brown says the speaker has never met Pissios.

In his first run for mayor, Rahm Emanuel gets endorsed by John T. Coli Sr., then-president of the Teamsters Joint Council 25, on Jan. 25, 2011. I Sun-Times files

In his first run for mayor, Rahm Emanuel gets endorsed by John T. Coli Sr., then-president of the Teamsters Joint Council 25, on Jan. 25, 2011. I Sun-Times files

Cinespace deposited four of the five state grants with Belmont Bank & Trust, headed by Pissios’ former zoning attorney James Banks. And the bank gave Cinespace nine loans totaling $24 million, starting in March 2011, records show.

The Pissios bankruptcy case was closed in June 2011 when a federal judge dismissed debts that Pissios and his wife owed to more than 100 creditors. Those creditors included Washington Federal Bank for Savings in Bridgeport, which federal regulators closed this past December just days after the bank’s president was found hanged at a customer’s home. Federal regulators are now trying to recover $60 million in loans.

As Cinespace was getting the state grants, Emanuel announced in October 2013 the studio also would get a property tax break for redeveloping polluted land. City Hall estimated that this “brownfield” tax break would save Cinespace about $3.4 million. But Cook County Assessor Joseph Berrios put the brakes on those tax breaks over concerns regarding top Cinespace financial officer Mark Degnen having also been a top official at Ryerson Steel, the company that polluted the property. Berrios eventually approved the tax break in fall 2016.

Former Gov. Pat Quinn.

Then-Gov. Pat Quinn in April 2013 on the set of “Divergent” at Cinespace Chicago Film Studios. | Sun-Times files

Andrew A. Nelles / Sun-Times file

Mirkopoulos died in December 2013, and Pissios became head of the studio, which has been home to a steady stream of popular TV shows produced by Dick Wolf and others, as well as movies, all thanks to millions of dollars in tax credits the state of Illinois gives production companies to come to Chicago and hire local actors, crews and support staff.

With Pissios in control, Cinespace applied for its final grant in November 2014, two weeks after Quinn lost the governor’s race to Rauner. Quinn’s staff issued the $10 million grant weeks before he left office, ostensibly to help Cinespace buy buildings surrounding the studio.

But three months after Cinespace got that grant, the Sun-Times reported the state had given the studio money to buy property that wasn’t for sale. Rauner demanded the studio repay the money, which was returned the next day in March 2015.

Within weeks, the Credidio family filed a federal lawsuit against the state, accusing the Quinn administration of steering TV producers and movie-makers to Cinespace. Pissios and several former state officials have been deposed in that ongoing lawsuit.

Cinespace Chicago Film Studios. | Sun-Times files

Cinespace Chicago Film Studios. | Sun-Times files

By the spring of 2016, federal prosecutors confronted Pissios.

For the next year, federal authorities had a series of meetings with Pissios, and, according to Coli’s indictment, the payments to the labor boss continued.

Pissios signed his “non-prosecution agreement” in March 2017.

According to his indictment, Coli got what turned out to be a final payment, of $25,000, on April 4, 2017 — the date he was arrested in the alley behind his home in Lake View.

Coli was indicted in July 2017, charged with extortion and “demanding and accepting a prohibited payment as a union official” for taking payments on five occasions while Pissios was cooperating with investigators.

A superseding indictment last September said that the scheme began “in or around” 2014, and additionally it accused Coli of failing to report the money on his tax returns. Prosecutors are seeking at least $325,000 in forfeiture payments from Coli.

Coli recently sold his home for $1.26 million. He has resigned his posts with the union, which then booted him out when he failed to answer questions from a court-appointed investigator looking into the Cinespace case.


• Teamsters boss John Coli’s tenure at Mokena local proved lucrative to son’s firm, May 20, 2018

• Indicted former Chicago Teamsters boss John T. Coli Sr. booted out by union, Feb. 11, 2018

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