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Former Chicago Sgt. sentenced in $1.1M union embezzlement case

Admitted he stole sum from Sergeants Association, lavish lifestyle was filled with steak dinners and gambling sprees

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John Pallohusky has pleaded guilty to a charge of theft for embezzling more than $1 million from the Chicago Police Sergeants Association.

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By Rummana Hussein
Chicago Sun-Times

CHICAGO — John Pallohusky had hoped he’d receive probation for admitting he stole $1.1 million from the Chicago Police Sergeants Association to satiate a glamorous lifestyle filled with steak dinners and gambling sprees.

The 56-year-old took a blind plea in April and even though he didn’t pay the money back, he has every intention to do so, his lawyers said Tuesday, urging for leniency.

But Cook County Judge Diane Gordon Cannon ultimately sided with a burned former colleague who thought Pallohusky deserved to be thrown behind bars like disgraced ex-governors George Ryan and Rod Blagojevich for betraying the 1,200 officers who entrusted the then high-ranking cop with their hard-earned dues.

“Mr. Pallohusky, it doesn’t get much lower than stealing from your fellow officers,” Cannon told the former sergeant and association president before sentencing him to 12 years in prison for felony theft.

Cannon ripped into Pallohusky for having the “guts” to steal from the union he headed and told him she “prays” he did not quickly marry his now deceased girlfriend of 20 years for survivor’s benefits.

Earlier, the bespectacled Pallohusky, who was arrested in 2009, offered a “sincere apology to the association I was part of ... for what I may have done.”

Paul Bilotta was not buying it. The money prosecutors Bill Conway and LuAnn Snow said Pallohusky siphoned to help pay off a half dozen credit cards, whirlwind Las Vegas trips and a down payment on a Northwest Side home nearly “crippled” the union, the current Sergeants Association vice president said.

While Pallohusky repeatedly came to court without a “glimmer of remorse” and a “smirk” on his face, union officials met with lawyers to consider bankruptcy to save the association from doom, Bilotta said.

“He hurt his friends who trusted him, and he hurt his co-workers who believed in him,” Biotta said. "...We have begun putting the pieces back together again. We are not whole. We will not be whole for a very long time.”

Pallohusky’s attorneys told Cannon that Pallohusky would pay the restitution through $475,000 in his seized assets, $152,000 pension, $25,000 in widower benefits and a $500,000 life insurance policy should he die.

“It’s extremely extreme,” defense attorney Richard Beuke said of the sentence following Tuesday’s three-hour hearing.

Pallohusky was initially suspended without pay from the Chicago Police Department and relieved of all police powers, police spokeswoman Melissa Stratton said. But on April 18, a day after he pleaded out, he resigned.

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