Tuesday, July 17, 2012

Lofty Promises Turn Into Jail Term

Rendering of Theater Lofts
promised for the Chase Bank
parking lot on Winthrop
When UU ran a post last week about the shuttering of Kinetic Playground, we mentioned that there was enough financial backstory for a book, and referred to numerous investor and tenant complaints.  A book may well be in the works, but the Sun-Times front page will have to do for now.

Jimmy Gouskos, the owner of the building where the Kinetic Playground is located, was sentenced last week to 18 years in jail for fraud -- three years more than the prosecution asked for.  This is despite a letter of support from former 46th alderman Helen Shiller.

Many Uptowners first got to know Jimmy when he presented his plans to the community for two empty lots at on Winthrop and Lawrence in 2007.  One, just south of Lawrence (the Chase Bank parking lot), was to be a condo tower called "Theater District Lofts."  The other lot (the Aragon parking lot) was slated to become a building housing a 500-car parking structure, a multiplex to replace the movie theaters that somehow never materialized in Wilson Yard, and lots and lots of retail space.

Neither of those projects ever got built, and according to the convictions against Mr. Gouskos and his business partner, they became a black hole that ate up over $500,000 in earnest money deposits that people had placed to reserve homes in the Theater Lofts building.  There was also a defaulted loan with Broadway Bank (the closing of which pretty much sank the career of Alexi Giannoulias).  The Sun-Times also makes references to connections to the Mob, and deposit money going to internet poker and a drug habit rather than back to the people who had trusted Mr. Gouskos and his associates to build them new homes.

It's all a terribly sad story, with no winners.  Everyone lost something, and our hearts go out to the regular citizens who lost thousands of their hard-earned dollars and have no way of getting recompensated.  Perhaps they can take some comfort in knowing that Mr. Gouskos lost his own home to creditors -- located just south of the lot where the Theater Lofts were going to stand.

UU has been following this story since 2007.  To see more articles about it, click here.  The Sun-Times story is here.


  1. Better know as Ripoff Jimmy in the area where he lived at 4850 N. Kenmore. Close friend of former Alderman Helen Shiller. His new home in prison will give him plenty of time to think about all the fraud he committed around Uptown for years.

  2. It's a shame because so much of what was promised is what that area needs...we'll never see another boom like that in our lifetimes.

  3. If we can work a love triangle in there somehow I think we got a screenplay. A monkey mascot couldn't hurt either...

    The wife of one of the Kinetic owners used to sell hot dogs out of that little buggy during shows. She would plug into the bar. Sometimes I wondered if the hot dogs were the only part of the operation making money. Good hot dogs though.

    Even for Uptown this is a wacky story. I'm guessing that extra 3 years was Helen's (nice try) letter. Those judges can be independent types.

  4. I have known Jimmy Gouskos as a neighbor for about 13 years.

    I have never seen him looking like he was on drugs and have never known him to be a liar. He has a presence that is definetly "street".

    And I would never do business with him because I'm not a dumbell.

    However, anything he said he was going to do, he did. He never caused me any harm, was always pleasant, helpful and I believe that he was sincere in trying to build these condos. It was his dream. I do not believe he ever intended to defraud anyone in the building of these condos.

    He yearned for respectability. THe collapse of the economy and the housing market and the main ingredients which led to the failure of this enterprise.

    Whatever else he might have done could have been a contributing factor, but he's wasn't so stupid as to embark on something like this for the purpose of stealing peoples money. That was and could never have been the initial intention.

    THe real estate collapse is the main ingredient. THere may be other ingredients, but it isn't because he had criminal intent. He intended to build the condos. I have no doubt about that.

    Jail is not a place for Jimmy Gouskos. Not 18 years. And why is it that the small time people who always go to Jail while there isn't one big time person in jail who has involvement in the real estate debacle in prison?

    It's easy to put James Gouskos in Jail. It's not so Easy to put somebody from Goldman Sachs in jail because they run this country (into the ground)

    Jail is a place where people get abused, not rehabilitated.

    Jail is an industry, the largest manufacturer of Office Furniture in America.

    He should be made to pay back whatever he owes and he isn't going to be able to do that in jail very easily.

    What kind of dumbells can't see that Jimmy Gouskos would not be, maybe the best choice to do business with? It's obvious. He doesn't communicate that he's a person that can be trusted.

    That being said, he never cause me any difficulty whatsoever and I have never known him to lie to me about anything. That's one thing that always surprised me. He never lied. But he "looked" like he was.

    I think Jimmy is a very interesting person. And nobody should be put in jail unless they are a physical danger. THere needs to be another place for people to go who commit crimes.

    Jail is just abuse. Nothing more

  5. I'm confused by Stu's comment. He knows this person, trusts hiim, believes him, but doesn't find him credible?

    Stu, you have lost me. I am a dumbell. But then, I believe one of the big bailed out banks, when they tell me one thing and do another.

    And as wasteful as it is to taxpayers, I would keep a prison or two around to spare us dumbbells who become victims of fraud.

  6. Stu, hate to break it to you but people do not get 18 years in prison for fraud just because they "looked" like a liar. Often, some of the biggest crooks seem to be "nice guys" to their neighbors.

    Actions speak louder than words.

  7. I have a good friend who lost the $27,000 deposit he put down on one of these condos. Jimmy Gouskos pretended to be his friend, too, and easily won the trust of my very nice friend, a blue-collar guy who is a extremely disciplined saver and skilled with money, but very, very naive about people.

    If Gouskos was such a nice guy and on the up-and-up and all, why didn't he place buyers' deposits in an escrow account, which is the correct and legal thing to do? Failure to place deposits into an escrow account pending completion and closure is a serious violation of the law. If this had been done, buyers would have simply gotten their deposits returned when the deal fell through.

  8. Anonymous:

    I'm reflecting my experience. And my position which was never to do business with him. Never doing business with him doesn't ever lead me to the kind of confusion you are experiencing.

    You don't have to trust anybody. When you are doing business at this level you make sure your 27K deposit as one person mentioned is safeguarded, regardless if it's Jimmy Gouskos or Mother Teresa ( who apparently was a crook collecting money everywhere and under false pretenses according to one author_)

    You don't just give money to someone because they seem "trustworthy".

    Even trustworthy people run into problems they can't control and you lose your money anyway.

    Purchasing a condo that hasn't been built is VERY RISKY at any time. You would think people would have looked a little deeper into the situation before committing money to such a thing.

    I don't think Gouskos intended to defraud anyone. Now, he may have defrauded people after the economy fell through, I don 't know.

    But it doesn't matter, if you lose that kind of money on a condo that hasn't been built, it's really your responsibility and that's what you have to focus on so you don't do it again, not so much on the person who you believe "defrauded" you.

    If you focus your blame the person who sold you something that was extremely risky to begin with, you, you aren't learning anything about yourself and you will do it again in some way, shape or form.

  9. According to the article, your god buddy was not a first time offender, just swept up in a bad economy...."Gouskos is a long time associate of Chicago organized crime figures, according to a source familiar with the matter. he routinely dropped names of well known Outfit leader Joseph " The Clown" Lombardo."

    In 2002, Gouskos was sentenced to 33 months probation for theft of stolen property, and he was convicted of aggravated assault in 1995 and theft in 1988.

    Before Gouskos' sentencing, former Ald. Helen Shiller wrote a letter to the judge on his behalf, saying she knew him as a small-business owner and a developer."

  10. if you lose that kind of money on a condo that hasn't been built, it's really your responsibility

    Seriously?! I guess all of those real estate laws are just guidelines for good behavior, huh?

    And, if you truly believe that to be true, you've just opened the door for a massive financial raping of the 99%.

    Nice one.

    Note, Stu: the "con" in "con man" is short for "confidence". IE - the ability to instill undue confidence/trust in someone to set up a fraudulent endeaver.

    No wonder you're willing to speak well of a man with a string of felonious (some violent) priors and will now be spending the next couple of decades in the clink.

    As for Helen, part of me really misses the opportunity to read classic comments like this:

    It was my impression that if anything, he might have been over his head, especially since we know now an economic collapse was brewing that caught many more experienced developers in its clutches.

    Grammatical trainwreck aside, is she honeslty taking credit for having insight on something that hadn't yet happened, at the same time admitting that she didn't know that it was going to happen?

    God bless you, Helen.

  11. No way Mr. Stu...

    I far from an RE professional. But the law is pretty damn clear that the deposit money is to be put in an escrow account and left there until the deal is done.

    More or less, I am sure others can articulate it better. He knew when he spent that money he was breaking the law. To get 18 years the judge must have really seen a pattern illegal behavior.

    Bernie Madoff was an affable likable guy too.

    I'm still pissed former Ald. Helen wrote that letter. It was classless and beyond chutzpah. He didn't understand the complexities my ass...

  12. Stu, you can't blame the victims. In order for our economy to operate, there needs to be a certain level of trust. Putting money down on a condo that hasn't been built is risky for a number of reasons, none of which is that you have to worry that the developer will steal your money. The developer should NEVER steal the money and there should be penalties if they do. Regardless of why he did it, he stole a lot of money from a lot of people and deserves to go to jail so he can't do it again.

    Also, I like how you are defending a proven criminal while accusing Mother Theresa of stealing. That adds a lot of credibility to your argument, believe me.

  13. "if you lose that kind of money on a condo that hasn't been built, it's really your responsibility"

    Um, no. No, it's not.

    That's why Jimmy is in Stateville, and the people who lost money to him are not.

    Stu, you liked your neighbor. I get it. I like my neighbors, too. But the guy admitted fleecing people, admitted a drug habit, and has more than a few items on his rap sheet. I'm sure he was charming and likeable, but he is a crook. They're not mutually exclusive.

  14. If we're going to roast Shiller, lets not pretend he didn't fool Cap.


    "The community owes a lot to Mr. Gouskos. His commitment to that area really helped turn it around. He was here long before it was popular to do such an exciting venture as this, so I wish nothing but the best for him and this project.

    One thing you can say about Mr. Gouskos… he loves his community and he’s proud to live here."

  15. Alek, you forget to mention Cap's comment was from January 2008 while Shiller's letter was written before the recent sentencing. It would be unfair to say that James's comment from 2008, which may have been before any crimes related to this property had been committed, is comparable to Shiller writing a letter after his guilt had been proven. In fact some might say it is misleading to compare the two at all, but I'll leave that up to every to decide for themselves.

  16. The author who dissed Mother Teresa was Christopher Hitchens, professional atheist and enternal thorn-in-the-side of people of (whatever) faith. Yes, she took donations from some less-than-stellar folks over the years but it was in the hope that by doing these good works these people would see the light and work towards reform and redemption. It's called Christianity, people.

  17. Gayle,

    You're right about Hitchens, though, I don't think his thorn-in-the-side-ism is eternal any longer.

  18. I just reread the conviction sentencing. I didn't realize there were two judgements against him, a 10 year sentence and an 18 year sentence. All told, he was convicted of 24 different charges. I don't know if that represents 24 different individuals. If so, I hope the sale of the house can somehow compensate the victims.