William A. Russell, a Schaumburg businessman, caught the FBI’s interest with a tantalizing offer to ensnare a high-ranking labor union official in corruption, authorities say.
Wired with a hidden recorder and given $10,000 cash in government money, Russell went off to deliver the bribe and returned with a tape-recording purporting to indicate the official had pocketed the money.
With that propitious start, Russell began a seemingly dangerous undercover assignment that would last 14 months in 1991 and 1992.
But now, law enforcement authorities allege that the bribe was a fiction, the tape was a hoax and the government mole was a con man trying the most brazen of double-crosses–bilking federal investigators in an elaborate scheme.
The only one charged as a result of Russell’s undercover work is Russell himself.
According to an indictment, Russell scammed the FBI of the $10,000 payoff as well as an nearly $113,000 in additional subsistence payments. The money had been provided Russell because he had curtailed his business activities to concentrate on the undercover probe, or so the FBI thought.
To make matters worse, the FBI incurred an additional $176,000 in expenses to support the undercover operation–bringing its total losses to almost $300,000.
Drug informants occasionally run off with relatively small amounts of government money intended for undercover narcotics purchases. But a betrayal of these alleged proportions is rare.
The indictment against Russell was filed earlier this week–not surprisingly, without official fanfare. Russell, 59, was charged with one count of conspiring to defraud a U.S. government agency, one count of obstructing justice and two counts of lying to a federal grand jury in April 1993.
With a dramatic flair in his testimony before the grand jury, called to investigate the union official, Russell said how the purportedly corrupt official closed his office door, pointed to a box and directed him to put the $10,000 payoff there, the charges alleged.
The official who was under investigation wasn’t disclosed by the government.
Bob Long, a spokesman for the FBI in Chicago, said the agent handling Russell’s undercover probe six years ago followed procedures by the book.
“We had no reason to suspect any wrongdoing at the time,” Long said.
The case against the union official apparently never came close to indictment.
“We are very careful before we indict somebody,” said a source close to the U.S. attorney’s office. “We turn over every stone. We can be deceived in that we can spend resources chasing after false leads, but it’s near impossible to intentionally mislead us into indicting the wrong person.”
Russell could not be reached Thursday at his Schaumburg home or at his business, ITSI T.V. Productions Inc., located in a Carol Stream industrial park.
More Top Picks Best Smart Displays For Kitchen
He is expected to be summoned to federal court soon for arraignment.
Dee Sellas, who identified herself as Russell’s secretary and lone employee, and Myrna Frankel, next-door neighbor to Russell’s nondescript white-brick house in the Knightsbridge subdivision in Schaumburg, both expressed shock at word of the charges.
“This blows my mind,” said Sellas, who indicated she has worked for Russell for nearly two years. “He’s never mentioned anything about this. I guess I’m at a total loss for words.”
“You’ve got to have the wrong guy,” Frankel said. “He has nothing but integrity. I’ve been living next to him for 20 years. Trouble and Bill Russell do not go together.”
According to Sellas, Russell rents out a television production truck and five cameras to local cable companies for coverage of sporting events. Sellas said Russell has a professional background as an electrician, but she didn’t know of any union ties he might have.
According to the indictment, Russell came to the FBI in the summer of 1991 with a claim of rampant corruption in a local labor union.
While wearing an FBI recording device, Russell met with the high-level union official on Aug. 15, 1991, the charges alleged. But after the meeting, he is alleged to have sabotaged the tape recording.
The next month, in what authorities called a ruse pulled off by Russell and an unknown co-conspirator, a telephone call was recorded to make it appear the union official confirmed the solicitation of a bribe. Four days later, Russell and his co-conspirator are alleged to have staged a face-to-face meeting in which Russell pretended to pay the $10,000 bribe to the union official.
Russell provided both tapes to the FBI, which launched an undercover investigation with Russell posing as the owner of a business that desired union labor.
The undercover probe ran from October 1991 until December 1992, according to the charges.
Because Russell had to abandon his primary occupation because of his full-time undercover work, the FBI paid him $112,804 in living expenses.
Russell continued to insist he had paid the bribe to the union official even after he was told by the FBI in June 1993 that criminal charges were being prepared against the official, the indictment charged.