A former Chicago real estate developer who converted hotels in Chicago, Miami Beach and other cities into condominium-hotels has been sentenced to six years in prison after pleading guilty last year on federal tax evasion charges, prosecutors said.
Robert D. Falor, 48, pleaded guilty in May to failing to pay more than $1.75 million in taxes between 2004 and 2007. U.S. District Judge Virginia Kendall said in a hearing today that Falor was “a one-man financial crime wave,” according to a news release from the U.S. attorney’s office. His brother and father also were part of the scam, however, prosecutors say.
Falor, who lives in Chicago but formerly lived in Glencoe and River Woods, was ordered to pay $1,752,948 in restitution to the IRS.
Falor, who has been in federal custody since being arrested in 2011, siphoned money from his company to buy multimillion-dollar homes, luxury cars, boats and planes, instead of paying a lender, tax authorities, union employees and other creditors, prosecutors said.
Falor’s business, the Falor Companies, Inc., bought and ran hotels in Chicago and Florida using a network of limited-liability companies, converting them into condo-hotels. In the condo-hotels, individual guest room would be sold to investors as condo units and rented by a related hotel management company to guests when the owner was not in residence. Falor operated several ventures of that kind including the Hotel Blake, 500 S. Dearborn St., and the Tides Hotel in Miami Beach.
Between 2006 and 2008, Blake diverted about $5.7 million from the Blake, and failed to pay taxes totaling $4.1 million. The hotel was foreclosed on in 2008.
Blake’s father, David R. Falor, 73, also pleaded guilty to tax evasion and was sentenced to two years in prison. His brother, Christopher Falor, also has pleaded guilty, and is to be sentenced March 5.