The Chapter 13 petition adds to a rising checklist of courtroom situations involving Thomas, most effective acknowledged in Chicago as an FBI informant who wore a wire on a confidant of previous Gov. Rod Blagojevich. An business building a Thomas partnership owns in St. Paul is in receivership. An Indiana procuring mall owned by another Thomas enterprise is in personal bankruptcy. And a individual bankruptcy trustee in a different situation has accused Thomas and a partner of diverting $2.8 million from a South Side searching heart in a way that constitutes larceny or embezzlement.
A personal individual bankruptcy submitting could offer you Thomas a way to extinguish his company debts. But it clashes with the rags-to-riches redemption tale he explained in a mid-February interview with Crain’s, when he volunteered that he was really worth $150 million.
Thomas claimed he experienced up coming to absolutely nothing when he was introduced from federal jail camp in Duluth, Minn., in 2017. He had been serving a sentence there right after pleading guilty to expenses that he stole much more than $370,000 in public money from a marina progress in south suburban Riverdale.
It was his very first excursion to prison but his second conviction. Immediately after pleading guilty to a billboard leasing scam in New York, Thomas gained probation in 2010, his reward for supporting federal prosecutors in Chicago convict Antoin “Tony” Rezko, a shut affiliate of Blagojevich, and former Ald. Isaac “Ike” Carothers.
Immediately after prison in 2017, Thomas went on an acquisition spree that integrated an Aurora apartment building, a shopping mall in Elkhart, Ind., and the previous Sherman Hospital in Elgin. With a new wife and youthful son, he explained he was a improved guy who lenders and investors could believe in. Questioned about the latest lawsuits and individual bankruptcy situations, Thomas, principal of Chicago-primarily based Liberty Development Group, expressed assurance he could take care of them, quite possibly by promoting the properties involved and working with the proceeds to pay out off debts.
“I’m not wealthy by income foundation,” Thomas said in February. “I’m rich by asset basis.”
His bankruptcy scenario tells a diverse story. Thomas, effusive in February, wouldn’t say considerably about the recent filing. In brief textual content messages, he mentioned the case “is staying withdrawn” and has “nothing to do with funds.” He did not respond to a observe-up information requesting an interview.
The 17-page petition is small on specifics. In addition to listing property of $ to $50,000, the filing estimates Thomas’ liabilities at just $500,001 to $1 million. It only lists 1 creditor: his ex-wife, Lori Korwek Thomas, who has a assert of $650,000 versus him.
“That was the impetus for the case,” says Jeffrey Harris, the nearby lawyer representing Thomas in the bankruptcy scenario.
Harris mentioned he was not informed of the character of the declare towards Thomas, saying only that he assumed it connected to the split of the couple’s belongings from their divorce. Korwek Thomas declined to comment, and her lawyer did not return a phone connect with.
What is surprising is that the Chapter 13 petition reveals very little about Thomas’ small business and true estate lenders. It claims his money owed are mainly buyer money owed, not business money owed, and suggests no creditors have statements secured by his residence.
Thomas owns stakes in a number of commercial properties through minimal legal responsibility providers, a conventional apply in the field. For some of the businesses, Thomas has confirmed reimbursement of personal debt in the function they default on home loans.
Of all of his the latest investments, Sherman Medical center potentially has labored out the most effective. A Thomas enterprise acquired the shuttered Elgin hospital for $1 million in 2019. In 2020, at the starting of the coronavirus pandemic, the condition resolved to lease the hospital for COVID-19 clients. But it in no way adopted through with its designs. As a substitute, it achieved a settlement to pay back the undertaking almost $4 million.
Other investments haven’t labored out so nicely. Several creditors and companions have sued other Thomas ventures and Thomas himself, alleging that they defaulted on money owed or reneged on agreements. In the scenario involving the South Facet browsing center, a personal bankruptcy trustee alleges that Thomas created illegal transfers from the house to other Flexibility Growth Group qualities. In February, Thomas insisted that he knew very little about the transfers.
Men and women who file for individual bankruptcy defense are needed to give a total listing of their property and liabilities. Harris, the lawyer for Thomas, acknowledged that his submitting involves omissions but stated it does not run afoul of the that necessity at this early phase in the situation.
“As of right now, suitable now, they don’t necessarily have to be accomplished,” Harris stated. “As of now, we’ve complied with the policies.”