Former Downers Grove Resident Sentenced in $3.6M Ponzi Scheme

Three serial fraud defendants—including a former Downers Grove resident—who met while incarcerated for unrelated crimes are heading back to prison after running a Ponzi scheme that cost 100 people more than $3.6 million, authorities said.

The U.S. Department of Justice announced Tuesday that U.S. District Court Judge Virginia Kendall last week sentenced Daniel Parrilli, 62, formerly of Carol Stream, to 70 months in prison, and finalized the sentencing of John Lauer, 48, formerly of Chicago, who received a 31-month prison term.

The lead defendant, former Downers Grove resident Christopher Andersen, 57, was sentenced last fall to 95 months in prison, according to the Department of Justice.

All three pleaded guilty to fraud charges that were brought against them in 2010.

Authorities said Andersen and Parrilli purported to run a business, Sundown Entertainment, Inc., that bought and sold films and comic book rights and together raised more than $7 million from approximately 150 investors. Lauer entered the scheme later and lulled victims with false assurances about their investments.

Parilli was ordered to pay more than $3.65 million in restitution and to begin serving his sentence on Aug. 1, while Lauer was order to pay $457,367 in restitution and to surrender June 12. Andersen, who is already serving his sentence, was ordered to pay more than $3.7 million in restitution.

In connection with Parrilli and Andersen’s sentencings, the government argued that the fraud scheme “had a terrible impact on victims, who in many cases depleted their 401K funds or their college savings, or took out loans against their homes in order to invest with the defendants.”

Andersen committed essentially the same crime previously when he was convicted in 2001 of offering and selling fraudulent investments in the form of promissory notes. He continued to engage in additional fraud schemes while the charges were pending in both cases, and even after he pleaded guilty in the Sundown case, authorities said.

Parrilli was previously imprisoned for bank fraud and fraudulently using aliases to obtain credit cards. When he and Andersen teamed up to form Sundown Entertainment, they promised investors returns starting at 10 percent to as much as 150 percent over a period of months to as short as a few days, authorities said.

Lauer joined the scheme after Andersen and Parrilli had already fraudulently obtained most of the funds they raised from victims, and he provided lulling assurances to nervous victims that their investments were safe. Authorities said Lauer also admitted to engaging in a separate investment fraud scheme involving the purported purchase of a surety bond to obtain the release of bank funds from the Cayman Islands.

Lauer was the direcor of risk management and benefits for the Chicago Housing Authority when he engaged in a scheme that involved the fraudulent offer and sale of investments in so-called prime bank instruments that resulted in losses of more than $20 million, including about $15 million in CHA pension funds.

The three men met while serving sentences in a federal prison in Oxford, WI.

The investigation falls under the umbrella of the Financial Fraud Enforcement Task Force, which includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources.

- - - - - - - - - - - - - -

There are plenty of ways to keep up on Downers Grove news:

• Sign up for our daily email newsletter

• Like us on Facebook for a slightly different take