Feds’ mole’s disappearing debt
Chicago TV/movie studio mogul Alexander S. Pissios was on the hook for more than $1 million when he began cooperating in a corruption case that took down a Teamsters boss. Now, he no longer owes that money.
Alexander S. Pissios, president of Chicago’s largest movie studio, had gone bankrupt but was still more than $1 million in debt when federal agents showed up three years ago.
They gave him a choice: He could go to prison for bankruptcy fraud, or he could help bring down one of the city’s top labor bosses, John Coli Sr. of the Teamsters union. Pissios, the head of Cinespace Chicago Film Studio, grabbed the deal.
Nearly five years after his 2011 bankruptcy, Pissios began giving authorities a rundown of the $1 million-plus he owed to a mortgage company, a scrap-metal dealer and a trucking magnate — debts that somehow have been erased now that he has become a cooperating witness, the Chicago Sun-Times has learned.
Pissios hadn’t made any payments on his mortgage for eight years while fighting Citibank’s lawsuit to foreclose on his family’s palatial home in Hawthorn Woods to collect more than $850,000.
He also owed $75,000 to a South Side scrap dealer who had put up $400,000 to convert the former Ryerson Steel plant into Cinespace.
On top of that, the movie mogul had a $70,000 gambling tab — a debt he said he’d been unable to cut into even after making monthly payments for more than four years to the owner of a trucking company who was on the board of directors of Evergreen Bank in Oak Brook.
These debts had lingered even years after Pissios and his wife filed for bankruptcy protection without disclosing all of their assets — specifically a $100,000 loan he got from his uncle while the family was trying to start the movie studio on the West Side, the Sun-Times has reported.
Federal agents called that fraud and threatened to send Pissios to prison for five years unless he helped bring down Coli, who was indicted on charges that he’d been extorting the movie studio for a total of $325,000 before being arrested in the spring of 2017 in the alley behind his Lincoln Park home.
The powerful, longtime Chicago Teamsters boss has pleaded guilty and is cooperating with federal authorities.
Pissios is unlikely to face any criminal charges. He was given a rare “non-prosecution agreement” that will keep him out of prison as long as he tells the truth in the ongoing corruption investigation.
Since he began cooperating, Pissios shed $1 million in debt and moved his family to a new home, in Long Grove, for which he got a $2.4 million mortgage from Belmont Bank & Trust, the clout-heavy Chicago bank that has been financing Cinespace for years.
Based on public documents, sources and interviews, here’s a look at Pissios’ debts and how they have been wiped out:
Pissios moved his family into a sprawling home in Hawthorn Woods in the summer of 2005 while he was developing townhomes around the United Center with business partner Edward Gobbo — whose late uncle William Hanhardt ran a jewelry theft ring for the mob while Hanhardt was Chicago’s chief of detectives.
Pissios and Gobbo built several homes with loans from Washington Federal Bank for Savings, a Bridgeport bank whose operations are now under federal investigation after it was shut down by regulators shortly after its president, John Gembara, was found hanged in a customer’s home in December 2017.
At the beginning of 2007, Citibank gave Pissios and his wife, Patricia, an $875,000, 30-year mortgage on the Hawthorn Woods home. About eight months later, they stopped making payments, though they continued living there for years, according to court records.
In April 2010, Citibank sued for foreclosure. It said Pissios and his wife owed $862,819 in principal, interest and late fees. The case dragged on for years as Pissios and his wife argued that the mortgage wasn’t valid for a variety of reasons that a judge ultimately rejected.
Shortly after Citibank filed suit, Pissios left the development business and helped his uncle Nick Mirkopoulos open a Chicago branch of their Toronto movie studio.
With their house in foreclosure, Pissios and his wife filed for bankruptcy in January 2011. But they didn’t disclose a $100,000 loan from his uncle to cover his expenses while he worked on setting up the studio. The bankruptcy case was closed five months later.
But the couple still remained on the hook to Citibank for their mortgage.
That spring, Cinespace got a $400,000 loan from C&R Scrap Iron & Metal, whose president Ronald Nisson is a former business partner of Pissios and Gobbo. Nisson filed documents with the Cook County recorder of deeds showing the loan was repaid in October 2013.
Three years later, Pissios told federal agents he owed Nisson $75,000. It’s unclear what that was for.
Pissios’ criminal defense attorney Thomas Breen says that the Cinespace loan from Nisson’s business has been repaid. And Nisson says Pissios no longer owes him any money.
The Pissios home was still in foreclosure in May 2016 when he agreed to cooperate with the federal investigation of Coli, who had introduced the budding movie mogul to the most powerful politicians in Illinois, including then-Gov. Pat Quinn.
As governor, Quinn arranged for Cinespace to get five state grants totaling $27.3 million to convert the Ryerson Steel plant at 16th Street and Rockwell Street into a movie studio.
Shortly before leaving office, Quinn gave the studio a final, $10 million grant to buy property around the studio, but the Sun-Times reported the land wasn’t for sale, and Gov. Bruce Rauner forced the studio to return the money in March 2015.
As Pissios was working with federal agents, a Lake County judge approved the foreclosure of his home. It subsequently was sold at a May 2017 sheriff’s sale for $650,000 — about half of what Pissios owed the lender by then.
Amid the pending foreclosure and while he was talking with federal investigators, Pissios formed a company in Delaware that bought the $1.6 million home in Long Grove, where his family now lives. The company then got a mortgage for as much as $2.4 million from Belmont Bank, which had lent money to the studio after Pissios deposited the state grants there.
The bank’s chairman is James Banks, a top Chicago zoning lawyer who worked for Pissios and Gobbo when they were developing homes.
Belmont Bank’s board of directors also includes former state Sen. James DeLeo and Fred B. Barbara, a businessman whose trucking company made a fortune hauling garbage for the city of Chicago dating to the administration of Mayor Harold Washington.
Barbara also owns Barbara-Pacella LLC with William Pacella, the owner of Pacella Trucking, who was on the Evergreen Bank board with Barbara.
Their trucking companies were among dozens of businesses that got work from City Hall’s scandal-plagued Hired Truck Program under Mayor Richard M. Daley. The program was spending millions of dollars a year on private trucks for city construction projects until a Sun-Times investigation revealed that many of the companies were paid to do little or no work.
Pissios told authorities he owed a $70,000 gambling debt to Pacella and had been sending Pacella Trucking monthly checks for $1,500 from his Belmont Bank account for more than four years — more than $72,000 — but that those payments never reduced the principal on the loan.
It’s unclear why Pissios owed Pacella money.
Pissios has acknowledged making illegal wagers on sporting events for nearly 20 years, dating to his days selling fur coats at an uncle’s store on North Michigan Avenue.
Pacella didn’t respond to interview requests.
Breen says Pissios no longer owes Pacella any money, saying, “A promissory note prepared by an attorney has been paid in full.”