Patrick Daley Thompson’s secret deal from Bridgeport bank shut down for ‘massive

Shortly after his election to the Chicago City Council in April 2015, Ald. Patrick Daley Thompson (11th) bought a $340,000 summer home in Michigan with a secret loan from a small Bridgeport bank that federal regulators later shut down for “massive fraud,” the Chicago Sun-Times has learned.

Washington Federal Bank for Savings never publicly recorded the loan, for which federal authorities have found that Thompson never made any payments on the principal or interest, according to sources familiar with an ongoing criminal investigation into the bank’s failure.

But the authorities found that the Bridgeport alderman still deducted thousands of dollars in interest payments that he owed — but never paid — the bank on the federal income-tax returns he and his wife filed with the Internal Revenue Service for several years, the sources say.

Thompson, who didn’t respond to attempts to reach him, has come under scrutiny as part of the federal investigation, the Sun-Times has reported. Sources say Thompson is among several bank customers under investigation for tax fraud regarding loans they received from Washington Federal Bank. They say authorities have been examining the loan for his summer home and his tax returns as part of their broader investigation into the collapse of the bank.

In an age when bank failures are rare, federal regulators shut down Washington Federal in December 2017. That was less than two weeks after John F. Gembara — its president, chief executive officer and major shareholder — was found hanged in the master bedroom of his bank customer and friend Marek Matczuk’s million-dollar Park Ridge home. Matczuk had five outstanding loans from Washington Federal totaling about $1.8 million.

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Federal authorities investigating Washington Federal’s failure have found that the bank Gembara’s grandfather founded in 1913 to serve his fellow Polish immigrants made loans in some cases that customers didn’t have to repay, loans that were made either without requiring any collateral or without appraising the value of the collateral.

Four bank officials have been indicted on bank fraud charges in the ongoing cases, though a prosecutor has said “more” will be charged in the coming weeks.

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And one of the bank’s biggest customers, attorney and developer Robert M. Kowalski, has been charged with embezzling as much as $29 million from the bank. Gembara was the godfather of Kowalski’s son.

The bank’s other four board members — including Gembara’s sister Janice Weston and William Mahon, a stalwart of the Daley family’s 11th Ward political machine who is a deputy commissioner of the city of Chicago’s Department of Streets and Sanitation — have retained criminal defense attorneys.

Thompson, an attorney who is the grandson and nephew of Chicago’s two longest-serving mayors, and his wife, Kathleen, who is assistant principal of a Bridgeport school, owe income taxes, penalties and interest totaling in the six figures to the IRS related to the Washington Federal loan, sources say.

It’s the second time the Thompsons have run afoul of the IRS. On June 16, 2010, the IRS placed a lien against the couple for failing to pay $38,635 in income taxes, records show. The lien was…