COVID relief fraud probe includes over 50 employees in Cook County Clerk of Court Iris Martinez’s office

Other city and county agencies also have been looking into employees’ loans under the federal Paycheck Protection Program.

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The Cook County clerk of the circuit court’s inspector general is working with Cook County’s inspector general’s office investigating possible fraud by county employees involving federal Paycheck Protection Program.

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More than 50 employees of Cook County Clerk of Court Iris Martinez are suspected of defrauding a federal program intended to help small businesses struggling during the COVID-19 pandemic, a spokesman said Friday.

The clerk’s inspector general is working with Cook County’s inspector general’s office, which is conducting a separate investigation of employees who work for Cook County Board President Toni Preckwinkle, according to Martinez spokesman James Murphy-Aguilú.

Interim Cook County Inspector General Steven Cyranoski has provided Martinez’s investigators with a list of clerk’s employees who’ve obtained loans from the federal Paycheck Protection Program. Cyranoski’s office also subpoenaed bank records of those workers on behalf of Martinez’s investigators, who don’t have that authority.

“She’s not going to tolerate any amount of corruption in our offices, given the public trust that is required from our employees,” Murphy-Aguilú said of Martinez.

Most of the court clerk’s employees who are under investigation had gotten PPP loans of about $20,000 by saying they had made at least $100,000 from an outside business in the year before they filed their applications, Murphy-Aguilú said. Some employees received about $40,000 in loans, he said.

“Many of the employees who work for us don’t earn $100,000 a year,” Murphy-Aguilú said. “To say you make more cutting hair than working here does not make a lot of sense.”

The clerk of courts’ investigation could take at least two months to complete — part of the widening scrutiny of city and county employees who got such pandemic-relief loans in 2020 and 2021.

The Chicago Housing Authority, Cook County chief judge’s office and Cook County offices — including the revenue department, comptroller and Cook County Board of Review — are among those conducting investigations.

State and federal prosecutors have been notified of the findings of some of those investigations.

City Hall Inspector General Deborah Witzburg said her office also is investigating the possibility of such fraud by employees of the Chicago Police Department and other city agencies. She wouldn’t discuss details.

Murphy-Aguilú said no one has been fired but at least one clerk’s employee who was under investigation has retired and he expects more will do so.

He said one or more clerk’s employees told investigators that a broker took a fee to file that worker’s paperwork for a PPP loan.

Law enforcement sources said prosecutors appear to be less interested in people who got fraudulent pandemic-relief loans than in any brokers who illegally arranged them.

Murphy-Aguilú said investigators also have found that some banks gave far less scrutiny to loan applications than other banks did.

“There was some predatory behavior from the industry,” he said. “Some banks, for instance, required photo IDs; some didn’t. There’s a lot of blame to go around.”

Contributing: Fran Spielman

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