Cook County Clerk Karen Yarbrough has been dogged by accusations she inappropriately mixed her work as a public official with her personal and political business, even to the point that a federal court until just earlier this month supervised her offices to prevent patronage hiring.
A new lawsuit filed by a Cook County employee against Yarbrough and her husband echoes much of the criticism. It alleges a mix of family, political and professional actions taken by Yarbrough — which the employee states were “wanton, calculated, and with malice and willfulness” — defrauded the employee out of hundreds of thousands of dollars involving the sale of two buildings in Maywood, Yarbrough’s political home base.
Filed in Cook County this week, the lawsuit lays out a complex series of questionable moves and countermoves regarding the sale and purchase of two buildings on 17th Street in Maywood and alleges Yarbrough was not even legally allowed to make the sales. It also involves Yarbrough’s husband, Henderson, who used to be the Maywood village president; other Yarbrough family members; her political office; and village of Maywood officials who the county employee accuses of “harassment and obstruction” against him as a landlord.
Through a spokeswoman, Yarbrough dismissed the lawsuit as frivolous and a private matter relating to her late father’s estate.
The suit lands just weeks after Yarbrough was freed from federal oversight into her hiring practices that followed her for a decade from her time as county recorder of deeds to clerk.
That oversight was designed to ensure politics didn’t unduly creep into her offices’ hiring, firing, and promotion practices. Yarbrough was repeatedly accused of defying best employment practices and enlisting friends and political allies for jobs in her government offices. A federal judge released her from that oversight earlier this month, despite some reservations from watchdogs that she hadn’t fully addressed problematic personnel practices.
The plaintiff in the case, George Ferro, is a clerk in the county’s circuit court system who also has worked for Yarbrough’s government office as a seasonal election worker.
Ferro’s attorney is Anthony Peraica, a Republican who previously served on the Cook County Board and unsuccessfully ran as a Republican for several countywide seats, including losing to Yarbrough for the clerk’s seat in 2022. Peraica also has filed lawsuits alleging political chicanery by former Illinois House Speaker Michael Madigan, a Yarbrough ally.
Ferro’s suit alleges Yarbrough’s daughter arranged a meeting between Ferro and Karen Yarbrough to discuss a commercial real estate sale in 2019. Yarbrough was selling the property through a company named Donora Realty in Maywood, according to the suit. Donora Realty, which state records show is now dissolved, was started by Yarbrough’s late father, former Maywood Village President Donald Williams Sr., in 1967. The company’s most recent managing broker, according to state records, was Yarbrough’s husband.
At their first meeting, Yarbrough “solicited Ferro” to buy a property at 1001-1009 S. 17th Ave. in Maywood, a two-story building with storefronts on the ground level and apartments above, according to the suit. Ferro said he negotiated with Yarbrough, Yarbrough’s brother Donald Williams Jr. and an unnamed sister.
Yarbrough said the Proviso Township Democratic Party she leads paid $750 per month to rent the property at 1001 S. 17th Ave. and that members of her family rented the apartments above, according to the suit. She also told Ferro the roof had been properly maintained with no leaks, the suit stated. Ferro paid Yarbrough $5,000 in earnest money and another $106,000 when he and Yarbrough signed a deed agreement at Donora Realty on Christmas Eve of 2019, according to the suit.
In 2020, Ferro’s lawsuit states, Yarbrough offered to sell Ferro a property down the block at 1023-1031 S. 17th Ave. and that the tenants included an insurance firm and a clothing store owned by Yarbrough “and or members of her family,” as well as the Donora Realty offices. Other Yarbrough family members lived in the apartments upstairs, according to the suit.
Ferro signed another agreement and paid $100,000 for that property in June 2020 and states in the lawsuit he made $300,000 worth of improvements at both buildings, including new roofing, a water heating system and repairs to structures and electrical systems.
The suit alleges Yarbrough, acting as a trustee for the properties, was not legally allowed to make the sales. Two articles of agreement for deed are attached as exhibits for the suit, with Yarbrough’s signatures above the name of the trust that technically owned the properties.
After he began acting as landlord, Ferro alleges the first building’s roof leaked prior to him getting it fixed and that the Proviso Township Democratic Party and family-owned businesses on the ground level failed to make rent payments, as did all but one of the relatives living in the units above. Relatives also tried to “pass the unpaid water bills” to Ferro “with knowledge of the party at fault,” according to the suit.
While the lawsuit said Yarbrough claimed the Proviso Township Democratic Party was paying $750 per month in rent, state records tell a slightly different story. Yarbrough’s campaign fund, Citizens for Karen Yarbrough, not the party fund, made regular $700 payments to Donora Realty starting in 2012. Those payments stopped appearing in campaign disclosures at the end of 2019, similar to what the suit alleges.
Yarbrough’s office declined to answer questions about whether Yarbrough has ever sold properties or had an ownership stake of Donora Realty or whether her family members were tenants at the property.
County elected and appointed officials, as well as some government employees, are required to file annual statements of economic interest with the clerk’s office that Yarbrough heads. As the former recorder of deeds and the county’s clerk since 2018, Yarbrough has been required to make those annual ethics filings for several years. But there was no mention of Donora Realty nor any proceeds from any property sales in disclosures that Yarbrough made dating back to 2013. In 2021 and 2022, the disclosures show she owned a home in Maywood.
“This frivolous lawsuit comes from a disgruntled county employee whose attorney was overwhelmingly defeated by Clerk Karen Yarbrough when she was reelected in 2022,” Yarbrough spokeswoman Sally Daly said in an email Thursday. “The allegations stem from private, family-related real estate transactions in which she was serving as the trustee for her deceased father’s properties.”
“The Clerk has been a realtor in good standing for nearly 50 years serving Maywood and surrounding communities and she intends to vigorously defend her reputation against these false and malicious allegations,” Daly said in the statement. “The Clerk believes that she has complied with the requirements associated with her statement of economic interest.”
After the June 2020 sale, Ferro alleges village employees, “acting at the request” of Karen Yarbrough and her husband, Henderson, “commenced to act to harass and obstruct” him from operating the property. Building inspectors told “tenants not to pay rent,” sought to “pass the unpaid water bills of relatives” to Ferro, stopped Ferro “from obtaining new tenants” and sent “inspectors for repeated inspection to assess unfounded violations” at the properties, according to the suit.
Henderson Yarbrough was village president between 2005 and 2013 and was a village trustee from 2013 to 2019, meaning he was out of office when Ferro alleged the harassment began.
Maywood village officials did not respond to a request for comment.
Ferro is suing Karen Yarbrough for fraud, and her husband and the village of Maywood for civil conspiracy and “aiding and abetting” the clerk’s efforts. He’s seeking damages, attorneys fees, and the deeds to both properties. If that effort is unsuccessful, he wants to be paid back for what he spent.
Ferro states in the suit he later learned Yarbrough, who as clerk is also in charge of maintaining county records of land transfers, “never possessed the legal authority” to sell the properties on behalf of the trust and never turned over the deeds for either property. Peraica told the Tribune in an interview that an admission was made verbally by Yarbrough to Ferro, and they will not know for sure who had authority to sell the properties until they subpoena the trust that owns them.
After confronting Yarbrough, Ferro states in the suit that she advised him “to allow the properties to go to tax sale and bid on the properties through a new entity.” Ferro alleges in the suit he thought Yarbrough was coordinating so others could outbid him.
Yarbrough “intended that (Ferro) lose all claim” to both properties “by administrative proceedings such as tax sales or sale forced by financial failure caused by a lack of rental income” and that her actions were “wanton, calculated, and with malice and willfulness.”
Overdue taxes for the two properties totaling roughly $31,000 did indeed go up for sale in 2022. According to records from the county treasurer’s office, late taxes owed by both properties were sold to other entities.
“It’s always money, it’s all about the money here, they had a bad building on their hands, they found a sacrificial lamb who was willing to give them a lot of money, then they wanted him to lose the property,” Peraica said. Ferro “had no representation” during negotiations and relied on Yarbrough’s word that the signed agreement was sufficient. “Was it smart on his part? No. Absolutely not.”
Now, Ferro says his current boss, Circuit Court Clerk Iris Martinez, is moving to fire him “on false allegations of improper actions.” He thinks Yarbrough requested it, according to the suit.
Payroll records show Ferro as an active employee as recently as a month ago, and that he has worked for the county since 2006. The suit says he also worked part time in Yarbrough’s office during election season, which Yarbrough’s office confirmed. An LLC Ferro manages, Private Holdings, is also a plaintiff. The LLC’s authority to do business in Illinois has been revoked as of May, according to state records, meaning its leaders failed to pay the annual fee and file the annual report.
The letter from Martinez’s office alerting Ferro of allegations of misconduct related to job performance — including being distracted during court calls and failing to correctly enter case information into the office’s internal system — came in early June, Peraica said.
The allegations by Martinez’s office are untrue, Peraica said. Only after receiving the letter did Ferro move to pursue legal action.
In a prepared statement Monday, Martinez said she was not part of the litigation and that “Ms. Yarbrough has never contacted my office regarding Mr. Ferro.”
“The allegations made by Mr. Ferro and his attorney Anthony Peraica about me are not only false, they are presumptive, reckless and defamatory,” Martinez said in the statement to the Tribune. “While Mr. Ferro’s job performance in my office has been reviewed multiple times prior to the filing of his lawsuit against Clerk Yarbrough, it has nothing to do with retaliatory conduct.”
This story has been updated to include a prepared response from Cook County Circuit Court Clerk Iris Martinez.
Tribune reporter Ray Long contributed.
aquig@chicagotribune.com
