Former state legislator Annazette Collins was convicted Monday on four of six tax-related charges, a mixed verdict delivered after more than eight hours of deliberations.
A federal jury convicted her of filing two false tax returns and failing to file one personal tax return and a return for her lobbying firm. She was acquitted of failing to file a corporate return in 2016 and also of filing a false tax return for herself in 2018.
Collins, 61, sat stoic as the verdict was read. U.S. District Judge Jorge Alonso scheduled her sentencing hearing for June.
After the verdict, Collins left the Dirksen U.S. Courthouse surrounded by a group of relatives and supporters.
Her attorney, Shay Allen, told reporters they did not agree with the verdict and would appeal.
Allen said he believed that the case was “all politically motivated,” but said he could not get into specifics because the case was ongoing.
“I think that there was a reason, I’m sorry to say we know the reason, why these minuscule charges were pursued by the United States government,” he said. “When it’s all said and done and we’re all able to speak about what’s really going on here, we’ll make it clear. But I don’t think this is a case that ever should have been brought by the United States government.”
Collins was a longtime state representative before being appointed to fill a vacancy in 2011 left by state Sen. Rickey Hendon’s abrupt resignation. Her criminal case is the latest to stem from the sprawling federal investigation of former Illinois House Speaker Michael Madigan and his once-vaunted political operation.
When Collins was indicted in 2021, federal authorities were closing in on Madigan, charging a string of ex-lawmakers and lobbyists with ties to the then-powerful speaker and ComEd, which was Collins’ biggest lobbying client.
The charges against Collins, who represented Chicago’s West Side as both a state representative and senator, focused largely on income from her successful lobbying and consulting firm, Kourtnie Nicole Corp., which she formed after leaving the legislature in 2013.
Between 2014 and 2018, Collins starkly underreported her lobbying income on tax returns, including one year showing she’d made less than $12,000 when her firm actually had about $120,000 in gross receipts, according to prosecutors.
In 2018, Collins had her tax preparer augment her business travel expenses to $25,000 when most of her travel spending that year was actually for personal vacations to Jamaica and Mexico, according to testimony. The false report meant the IRS actually sent Collins a check for more than $2,000, even though she’d paid no taxes into the system that year.
Collins also failed to file a personal return in 2016 and filed no corporate income tax return for her firm in 2015 or 2016, even though the company was annually making six figures, according to prosecutors.
In all, prosecutors allege, Collins avoided paying $99,800 in federal taxes over the five-year period in the indictment.
In his closing argument Friday, Assistant U.S. Attorney Amarjeet Bhachu portrayed Collins as a “sophisticated” and “details-oriented” former elected official who had “a hundred thousand reasons” to lie to the IRS about her income.
“Annazette Collins served at the highest levels of state government for more than a decade, as a representative and as a senator,” Bhachu said. “But for all of her sophistication and her success, ladies and gentlemen, it didn’t stop her from being consumed by greed.”
Allen began his closing argument by holding up a copy of the indictment and tearing it to shreds, calling it “useless nonsense.”
He laid the blame at the feet of two professional accountants who had prepared Collins’ tax returns, saying they were responsible for making sure that the financial information Collins gave them was accurate.
Allen also blasted the government for what he said was an overzealous investigation, which included detailed testimony about Collins’ personal expenditures, from gym memberships to sending her teenage daughter to a fancy camp at Sea World in San Diego — the onetime home of the Shamu, the trained Orca.
“Power without restraint leads to abuse,” Allen said. “They scoured every corner of Ms. Collins’ life. … They’re bringing in Shamu! Why? Because they don’t have any evidence. That’s why they’re bringing in Shamu.”
Allen likened the government’s case to an Italian restaurant where they “bring you out large amounts of pasta … trying to disguise that the food isn’t good.”
“Don’t accept what they are shoveling at you. You don’t have to,” he said. “Ms. Collins did what she thought was right. She took her materials to the preparers and thought that was it. And here she sits today.”
In rebuttal, Assistant U.S. Attorney Michelle Parthum questioned Allen’s portrayal of how tax preparation works, noting it was Collins who gave the numbers to her accountants and reminding the jury of the old adage “garbage in, garbage out.”
“You could have the best tax preparer in the world, (but) if you lie to them and they do their calculation, what comes out is going to be a lie,” Parthum said. “And that’s what happened here. It’s not their job to catch it. It’s the defendant’s job not to lie.”
The trial got an injection of drama Friday when prosecutors revealed Collins was fired from an insurance job shortly after leaving the General Assembly for filing bogus insurance policies for customers who either didn’t ask for them or “did not exist.”
The jury has heard evidence that Collins was fired “for cause” from American Income Life Insurance in 2014, but the specific reason was not disclosed. Collins earned nearly $100,000 from the company on a contract basis selling life insurance policies, income that she allegedly never reported on her tax returns.
After lawyers for Collins told the judge she intended to testify in her own defense, Parthum argued she should be able to question Collins on the topic of her firing, since her actions were “criminal” in nature and probative of her credibility.
Allen objected, saying it would be highly prejudicial for the jury to hear about it. But Alonso sided with the government and allowed them to conduct a limited inquiry.
After that ruling, Allen told the judge Collins had changed her mind and would not take the witness stand after all.
The trial is the latest to stem from the Madigan investigation, which so far has toppled some of the state’s most powerful players.
Madigan himself was indicted in 2022 on racketeering charges alleging his elected office and political operation were a criminal enterprise that provided personal financial rewards for him and his associates, including through bribery schemes arranged by ComEd and AT&T Illinois, another lobbying client of Collins’.
Also charged was Madigan’s longtime confidant, Michael McClain. Their trial is set for October.
While Collins’ case was not directly tied to the Madigan probe, her name has surfaced in a number of recent corruption trials, including the “ComEd Four” trial last year, when she turned up on a so-called magic list of Madigan-approved lobbyists found during a raid of McClain’s home in Quincy.
From 2014 to 2018, Collins was paid more than $200,000 by ComEd for lobbying and consulting services, according to testimony. She was also paid thousands as a contract lobbyist by consulting firms run by staunch Madigan allies: Cullen Inc., run by Thomas Cullen, a former top Madigan staffer and longtime political strategist; and Roosevelt Group, headed by Democratic political operative Victor Reyes.
Last week, prosecutors displayed for jurors consulting contracts showing AT&T paid Collins nearly $100,000 from 2015 to 2018. They were signed by then-AT&T Illinois President Paul La Schiazza, who is charged separately with trying to corruptly influence Madigan by hiring another ex-state representative, Eddie Acevedo, as a consultant.
Testimony also showed Collins was paid $11,000 for consulting services by Rekooh Management. Though the owner of that firm was not brought up, records show it is ex-ComEd executive John Hooker, who was convicted in the “ComEd Four” trial in the scheme to bribe Madigan.
mcrepeau@chicagotribune.com
jmeisner@chicagotribune.com
