Feds allege ex-state legislator Annazette Collins sold bogus insurance policies [Chicago Tribune]

Chicago Tribune (IL)

Federal prosecutors revealed Friday that former state legislator Annazette 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 disclosure came after lawyers for Collins told the judge she intended to testify in her own defense in her tax fraud case, which is now in its fourth day at the Dirksen U.S. Courthouse.

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.

Assistant U.S. Attorney Michelle Parthum argued she should be able to question Collins on the topic of her firing if she takes the witness stand, since her actions were “criminal” in nature and probative of her credibility.

Collins’ attorney, Shay Allen, objected, saying it would be highly prejudicial for the jury to hear about it. But U.S. District Judge Jorge Alonso sided with the government, saying he would allow them to conduct a limited inquiry.

Collins is expected to testify Friday afternoon.

Collins, 61, who represented Chicago’s West Side before losing in the Democratic primary in 2012, is charged with three counts of filing a false individual income tax return, two counts of failing to file a corporate income tax return, and one count of willfully failing to file an individual income tax return. The most serious charges carry up to three years in prison.

While the charges involve Collins’ work as an insurance agent, they focus more on income from her lucrative lobbying and consulting firm, Kourtnie Nicole Corp., which she former after leaving the legislature in 2013.

Between 2014 and 2018, Collins vastly underreported her lobbying income on tax returns, including one return showing she’d made as little as $11,500, according to prosecutors. She 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.

“(Collins) was a former Illinois state senator and representative who for years had been trusted with making the laws of the state of Illinois,” Parthum said in her opening statement Tuesday. “But when the time came for her to follow the law… she chose not to.”

In his opening remarks, Collins’ attorney, Shay Allen, described his client not as some sophisticated ex-lawmaker but as an everyday wife, mother and colleague who is a “hard-working citizen of this country.”

He said like most people clueless about tax laws, Collins placed her trust in a pair of accounting experts to file accurate returns, and that any discrepancies or failures to file rest at their feet.

Collins was indicted in 2021 amid the sprawling investigation into an alleged scheme by ComEd to bribe then-House Speaker Michael Madigan. 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 on Madigan’s longtime confidant, Michael McClain.

On Wednesday a series of prosecution witnesses testified about income Collins received as a lobbyist and consultant from 2014 to 2018, including more than $200,000 from ComEd alone.

She was also paid thousands of dollars in 2014 and 2016 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, according to testimony Wednesday.

On Thursday, prosecutors presented 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 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, the Tribune has previously reported it is ex-ComEd executive John Hooker, who was convicted in the “ComEd Four” trial in the scheme to bribe Madigan.

Also Thursday, IRS Special Agent Christopher Suba testified about Collins’ use of her company’s funds for personal expenditures, including flights to Punta Cana, Mexico, gym dues at LA Fitness, private school tuition and paying for her daughter to attend camp at Sea World San Diego.

On cross examination, Allen asked Suba if their investigation wasn’t a bit overkill. “You subpoenaed Sea World!? I saw Sea World walk in here!” he said. “I’m surprised you didn’t subpoena Walmart to show that she bought some lettuce!”

Collins was a longtime state representative before being appointed to fill a vacancy in 2011 left by state Sen. Rickey Hendon’s abrupt resignation.

Records show Collins registered as a contract lobbyist for ComEd in 2014, a year after she left office. Her last year registered for the utility was in 2019, when news of the federal bribery probe began to surface.

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