By Matt O'Connor
Tribune staff reporter
Published June 8, 2002

The onetime manager of a company that allegedly looted Cicero town coffers of millions of dollars testified Friday he used stolen funds for everything from paying off $150,000 in personal credit-card bills to pursuing trade opportunities in Russia.

Frank W. Taylor, the former day-to-day head of Specialty Risk Consultants, admitted he used $100,000 stolen from the town for a down payment and to renovate his Kildeer home. He testified another $30,000 was spent for landscaping, $10,000 for expensive suits and tens of thousands of dollars more for Christmas gifts, electronic gadgets, furniture and personal travel.

With the approval of Specialty Risk's secret owners--defendants Michael Spano Sr. and John LaGiglio--Taylor said he traveled twice to Russia to try to line up export deals and to Reno to buy a savings and loan. Stolen town funds financed the trips, Taylor said, but both ventures fizzled.

Spano and LaGiglio are on trial, along with Town President Betty Loren-Maltese and former town officials, Emil Schullo and Joseph DeChicio, on charges of being part of an insurance scam that allowed Specialty Risk to steal more than $10 million. Also on trial are Spano Sr.'s son, Michael Jr., LaGiglio's wife, Bonnie; and attorney Charles Schneider.

After Loren-Maltese became town president in early 1992, the weekly wire transfers from town coffers to Specialty Risk rose sharply, from $50,000 to $95,000 in just three months, Taylor testified.

That money was supposed to pay town employees' medical bills but instead, prosecutors allege, much of it was siphoned off for personal expenses--including the purchase and renovation of a Wisconsin golf course, a vacation home for the Spano family and a horse farm for the LaGiglios.

Between early 1994 and mid-1996, Specialty Risk contributed a combined $14,125 to Loren-Maltese's political campaign fund, according to evidence presented Friday.

Under questioning for a second day by Assistant U.S. Atty. Matthew Schneider, Taylor indicated the political contributions also came from stolen Cicero funds.

Taylor also alleged that Schullo, then the town's public safety director, used a signature stamp of the late Town President Henry Klosak to make it appear Klosak approved Specialty Risk's takeover as administrator of the town's health insurance plan before his death in late 1992.

At a fish fry hosted by the elder Spano, Schullo "joked about being able to raise the dead to get a signature," Taylor said.

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