Urbana, Ill. – Sentencing has been scheduled for October 15, 2009, for the former chief of police for the village of Grant Park, Illinois, Scott J. Fitts. Fitts pled guilty today to operating a fraud scheme in 2006 in which individuals arrested during prostitution stings made payments to resolve their cases. Fitts, 41, of Manteno, Illinois, also pled guilty to one count of filing a false federal income tax return and one count of structuring a monetary transaction.

During today’s hearing, before Chief U.S. District Judge Michael P. McCuskey, and in court documents, Fitts admitted he paid for a woman, identified as “Brooke,” to travel from Texas on five occasions in 2006 to pose as a prostitute to lure individuals to be arrested by the Grant Park police department for solicitation of prostitution. Fitts met “Brooke” in or about November 15, 2005, related to his employment as a Special Agent with the U.S. Department of Labor when “Brooke” was arrested in Chicago on allegations of prostitution. As part of the scheme, Fitts admitted he induced “Brooke” to assist the police department and that he paid “Brooke” approximately $38,242 for her assistance.

Fitts admitted that he instructed “Brooke” to advertise on an Internet website, post photographs of herself on specified dates, list an in-call rate of $300 per hour, and provide a contact telephone number and e-mail address. “Brooke” met individuals who responded to the ad at a motel in Manteno, instructed them to take a shower and when they did, Fitts and / or other officers arrested them. Fitts and other officers seized the cash the individuals had with them to pay the prostitute, typically $300, as well as any other cash in their possession. Following their arrest, the individuals were transported from Manteno to Grant Park to the police department.

As part of the scheme, Fitts admitted that the individuals were generally required to post $100 cash bond to be released from custody, as well as a $500 cash bond for release of their vehicle. Those arrested were informed that they had been arrested for solicitation of prostitution and despite being arrested in Manteno, could be prosecuted by the Village of Grant Park attorney. Further, their name and address might be placed in the newspaper, on the Internet or on a police department website. Many were falsely informed that the sting operation was a joint federal, state and local investigation and, that “Brooke” was an undercover federal agent.

Fitts admitted that as part of the fraud, he offered individuals what he termed a “plea agreement” if they paid a fine, typically $3,500, and waived any right to the money seized from them. In exchange, their case would be dismissed, no prosecution would occur, and their names would not be disclosed to media or posted on a website. Most of the individuals provided Fitts with the $3,500 payment, often in cash, to avoid public disclosure of their arrest. The few who refused to pay the “fine” were never charged with any state or local offense. As a result of the stings, no charges were ever filed and no arrests were reported to any other law enforcement agency or otherwise made public by Fitts.

Over the course of the scheme, approximately 100 individuals were arrested resulting in approximately $400,719 in proceeds: $50,657 cash seized; $40,450 bond posted; and $309,612 in fines. Nearly all of the proceeds, including the cash, was forwarded to Fitts as Chief of Police. As part of the scheme, only $175,958 was accounted for by records of Grant Park Police Department. According to those records, $33,382 was forwarded by Fitts to two accounts under the control of the village of Grant Park; $52,400 was placed in the Grant Park Police Association account, which Fitts controlled; $38,242 was paid to “Brooke;” $13,000 was forwarded to the Manteno Police Department for assistance in conducting the stings; and $38,934 in cash was stored in a cardboard box under Fitts’ control, in the police department vault.

As a result of the scheme, Fitts admitted he diverted approximately $224,760 in payments from those arrested for his own use. From February 14, 2006 to September 7, 2006, as part of the scheme, Fitts made cash deposits and payments totaling approximately $198,107 to personal bank accounts, payments on personal loans, at a casino and to a landscaping company. Further, approximately $20,000 in Grant Park village funds were diverted to Fitts’ personal use when he submitted fraudulent payroll records reflecting that certain officers had worked certain days.

Fitts also pled guilty to filing a false individual income tax return for tax year 2006 for failing to report income received from the stings and payroll checks payable to others.

The offense of wire fraud carries a maximum statutory penalty of 20 years in prison and a fine of $250,000. For structuring, the penalty is up to 10 years in prison; for filing a false tax return, the maximum penalty is three years in prison.

The Federal Bureau of Investigation and the Internal Revenue Service Criminal Investigation Division conducted the investigation. The case is being prosecuted by Assistant U.S. Attorney Eugene L. Miller.