The former owner of a Chicago redevelopment company has been charged by the Securities and Exchange Commission with bilking investors out of more than $20 million that was supposed to be used for real estate investments that promised a 38 percent return in two years.
George Slowinski, who now resides in Texas but was a resident of Homer Glen, Ill., during the time the fraud was carried out in 2013 and 2014, has been sued by the SEC, which alleges he commited fraud by soliciting funds from more than 600 investors for a redevelopment project on the South Side of Chicago, the SEC announced last week. While soliciting investments, Slowinski held himself out to be a real estate expert.
While promising exceptional returns, Slowinski, who was a principal and owner of Rebuilding America, failed to tell investors that between 34 percent and 42 percent of the investments were going to be diverted to him and other Rebuilding America principals, the SEC said. Slowinski allegedly told investors that Rebuilding America would pool investor proceeds to acquire, refurbish and sell for profit residential real estate
The complaint filed in U.S. District Court for the Northern District of Illinois, said Slowinski quickly realized that Rebuilding America's business model was untenable, and would not be able to repay investors as promised, but he continued to solicit new investors. The SEC said Slowinski diverted more than $2.8 million of investor funds, which had been earmarked for construction on specific Rebuilding America projects, to improperly pay for his companies' payroll, overhead and cost overruns on other projects.