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Final Intrust payout still uncertain

The door offices former Independent Trust Corp. OrlPark is shown this file photo. | File photo

The door to the offices of the former Independent Trust Corp. in Orland Park is shown in this file photo. | File photo

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Updated: August 24, 2014 6:24AM



A Cook County judge has approved a plan to return almost $6 million owed to customers of a former Orland Park-based trust company, but account holders who have waited years for the money will need an assist from Illinois legislators.

PricewaterhouseCoopers, the state-appointed receiver for Independent Trust Corp., said there’s no money available to cover the cost of sending checks to thousands of Intrust customers.

Also, the accounting and consulting firm, as well as law firms involved in the receivership, said they are owed $800,000 for work they’ve performed but not been paid for.

Intrust was closed by regulators in April 2000 after about $68 million that was to be held in customer accounts was discovered missing.

The two men who controlled the company — Laurence Capriotti , a former Frankfort attorney, and Jack Hargrove, who developed real estate in the Southland — were each sentenced in 2006 to 14 years in prison for looting nearly $100 million from it and another company they controlled.

Although the pair were ordered to make restitution for the stolen funds, their few remaining assets that could be liquidated would barely make a dent in what was plundered from customer accounts.

From offices on 94th Avenue just south of Orland Square Mall, Intrust was caretaker for roughly $1.7 billion in trust assets for roughly 20,000 customers. The firm’s collapse was the first failure of a trust company in Illinois since the Great Depression and has become the biggest trust company liquidation in state history.

Thousands of Intrust customers had their accounts levied to make up for the missing funds. A cushion was built into the levy in case some accounts couldn’t be collected on, resulting in more money being collected than was needed to cover the shortfall.

About $17 million in surplus funds were doled out to account holders in 2003. PricewaterhouseCoopers has delayed disbursing the remaining money, which it says is about $6 million, until legal avenues aimed at recovering stolen funds are exhausted.

In a request to Circuit Court Judge Sophia Hall seeking approval for the final payout, PricewaterhouseCoopers said the “administrative burdens of keeping the receivership open now outweigh the benefits,” with the outcome of one final lawsuit unlikely to be determined for several years.

Intrust is insolvent, and the receiver and lawyers told Hall they’ve not been paid for their work since 2003, although there is money in a state account earmarked to cover such costs. That account was increased years ago by the Legislature, specifically “to account for the massive size and complexity of this very receivership,” according to the receiver’s motion.

The Legislature could approve releasing the $6 million to cover the outstanding bills and the cost of sending checks to Intrust customers, according to PricewaterhouseCoopers. It said that if legislators don’t act by Oct. 1 to release the money, the receiver would have to return before Hall with another plan for paying for the check distribution.

A proposed schedule for when checks would be issued is expected to be posted at Intrust’s website by Aug. 15.



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