Segal Fraud Trial Takes 2-Week Break Before Closing Arguments

Jurors in the federal fraud and racketeering trial of Chicago insurance broker Michael Segal have heard all but the closing arguments in the case.

Segal’s defense lawyers put on a brief case, as they spent much of their effort in cross-examining the government’s witnesses in an attempt to poke holes in prosecution’s case. Segal, the owner of Near North National Group, is charged with stealing more than $20 million from his brokerage’s premium fund trust account over the course of 10 years. He’s alleged to have spent the money on personal items and political contributions to Chicago and Illinois power brokers.

Some of the money went for thousands of dollars in personal expenses, including therapy and jewelry from Tiffany, according to federal court testimony. Over three years, the company spent almost $140,000 alone for Segal family purchases at two pharmacies and psychotherapy, records admitted at trial showed. Prosecutors said Segal should have declared the expenses as income on tax returns.

Internal Revenue Service Agent Patricia Morgan testified that the value of personal work performed by Near North employees for Segal and his family exceeded $325,000 between 1999 and 2001.

Segal has pleaded innocent, arguing that while Near North kept sloppy books, no one was cheated out of any money or insurance coverage. According to Morgan’s analysis, Segal, his wife, and two adult children ran up bills of more than $70,000 in three years at Carnegie-Sargent’s Pharmacy, $8,340 from Solomon Cooper Drug and in excess of $60,000 from Dr. Richard Schwartz of the Center for Self Leadership.

Closing arguments in the case will begin June 10.

Copyright 2004 Associated Press.