The head of AA Capital Partners, a Chicago-based investment firm, is facing federal charges that he embezzled $24 million in client funds.
John Orecchio, formerly of Arlington Heights, is charged with one count of wire fraud and one count of embezzling. The 43-year-old is co-owner and president of AA Capital Partners Inc. at 10 S. LaSalle St.
Federal officials claim that between 2002 and 2006, Mr. Orecchio and his firm received $169 million in investment funds from pension plans at mostly Michigan-based unions. He allegedly raided those investments of about $24 million “for his own use and benefit,” the U.S. attorney’s office said in a statement.
Mr. Orecchio was accused of similar wrongdoing by the Securities and Exchange Commission in 2006. The SEC filed a complaint accusing Mr. Orecchio of misappropriating at least $10.7 million in client funds.
That money, the SEC alleged, was spent on operating a horse farm he owned in Michigan and a Detroit strip club. The SEC also claimed that he spent $120,000 of investors’ money to attend a Super Bowl game and used $1 million for political contributions.
If Mr. Orecchio is convicted of the wire fraud charge, he faces a maximum sentence of 20 years and a fine of either $250,000 or twice the amount of investor losses. The embezzlement charge carries a maximum penalty of five years and a $250,000 fine.
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