Feb. 13--An attorney for Steven Mandell began cross-examining George Michael, the government's star witness, today and quickly focused on the Chicago real estate mogul's shady dealings, particularly how he was thrown out of banking by federal regulators and won a huge tax break by pretending his lakefront mansion was a church.
Michael, 59, has testified for the last three days about the dozens of conversations he secretly recorded of Mandell, who is on trial for separate alleged plots to kidnap and kill a suburban businessman and murder a strip club figure to take over his financial interest.
Looking relaxed while under questioning by Keith Spielfogel, Mandell's lawyer, Michael acknowledged that he created the "Armenian Church of Lake Bluff" at his home in 2006 by drawing a cross onto a photo of the $7 million, 25,000-square-foot residence overlooking Lake Michigan and by placing pews on the home's racquetball court. He was "ordained" as a priest by clicking on a web site called the Church of Spiritual Humanism.
The Illinois Department of Revenue bought the scam and granted Michael an $80,000-a-year property tax break.
"But the Village of Lake Bluff didn't like that, did they?" Spielfogel asked. Michael, wearing light gray sweater, paused for a second before answering, "No."
Michael testified the village "filed a myriad of lawsuits" against him and that an administrative law judge later ruled the whole thing was a sham. The tax break was taken away. Michael filed for bankruptcy about the same time and still lives in the home, although it is up for sale.
When Michael first began working with the FBI in 2009, agents questioned him about information that he had paid a $10,000 bribe to a Deerfield businessman in order to secure the tax exemption. Michael said he denied ever paying the bribe, and court records show the investigation did not pan out.
Spielfogel also questioned Michael at length about Citizens Bank. He founded the bank with his brother in 2000, but federal regulators eventually seized control.
At one point during the cross-examination, Michael interrupted Spielfogel when he used the word "incredulously" to describe Michael's deposition testimony in the banking case.
"Could you define incredulously? I don't know what that means," Michael said.
Michael's cross-examination began after jurors listened to days of undercover recordings he made of Mandell in the fall of 2012.
While undercover recordings are often filled with coded language or cryptic conversations, Mandell spoke openly as he discussed kidnapping and killing Steve Campbell, a Riverside businessman who Mandell believed was flush with cash. Mandell can be heard on the hourslong recordings going over the plan to have Michael lure Campbell to his realty office, then "arrest" Campbell while posing as a police officer with a bogus warrant that would appear to be signed by the same federal judge who presided over the Operation Family Secrets mob trial.
Campbell -- jokingly referred to by Mandell as "Soupy" after the canned soup brand -- was to be brought to a Devon Avenue building dubbed "Club Med" in order to be tortured and executed, prosecutors allege.
"How do you know Soupy will talk?" Michael asks Mandell in one video played Wednesday.
"This guy will spill the beans," said Mandell, putting his hands over his eyes and letting out fake cries of terror.
Mandell is equally open about the plan to kill Anthony "Tony Q" Quaranta, who along with his associate Demitri Stavropoulos worked as a highly paid "consultant" at the mob-connected Polekatz Chicago Gentleman's Club in Bridgeview. In one recording, Mandell tells Michael that reputed Outfit boss Albert Vena should have been tapping the club for more money and that by not doing so he was showing weakness.
Once known as Steve Manning, Mandell was exonerated a decade ago in the slaying of a trucking firm owner. He was freed from prison and won a federal lawsuit against the FBI for framing him, but the verdict was later overturned.
After his arrest in October 2012, prosecutors alleged that Mandell tried to arrange Michael's murder from his jail cell.
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