Michael Segal, the insurance executive who lived in luxury in a Gold Coast condominium and lakefront mansion, dined at Gibson’s and counted the politically powerful as friends, now stands in line for breakfast at 6:30 a.m., has strict limits on his use of a telephone and lives in a 72-square-foot cell with a roommate at the Metropolitan Correctional Center.
In his only interview since he was jailed June 22 after his conviction on fraud and racketeering charges, Segal said he has no job duties so he spends most of his time reviewing documents from his trial, reading books by lawyers and advising other inmates on their cases and personal problems.
With an eight-inch stack of court papers at his side, Segal appears obsessed with his case but at times manages to display remarkable good humor for his dramatic change in lifestyle.
“The hot-water pressure is just as good as Lake Shore Drive,” he said. “The food may not be as good as Gibson’s, but it’s pretty good.”
But he also avoids looking out the windows from the high-rise federal jail in Chicago’s South Loop, he said, “because the outside reminds me of all the people, the buildings I insured and knew, the vibrance of it.”
Segal repeatedly referred to himself as “a political prisoner,” insisting he was jailed after his conviction last month as punishment for forcing the government to trial, an allegation staunchly rejected by prosecutors.
On Friday, moments after learning that his legal battle to win release from prison had been rejected by a federal appeals court, Segal vowed to appeal the decision to the U.S. Supreme Court.
Facing as much as 20 years in prison when he is sentenced, Segal, 61, was jailed as a flight risk after his conviction by a federal jury for raiding more than $20 million from a company trust account that by law must be held in reserve until paid out to insurance carriers. Prosecutors alleged he used the trust fund to expand his business, Near North Insurance Brokerage, and to support a lavish personal lifestyle.
In two interviews over the last 10 days, Segal, who didn’t testify at trial, said he was the victim of a conspiracy by executives who he said tried to wrest control of Near North from him, by business rivals, by prosecutors and agents, and by a “prejudiced” media.
Critical of jury
He returned time and again to several main themes of his failed defense, that the hole in the trust fund should have remained a state regulatory issue, that no one lost any money, that there was no intent to defraud.
Segal contended that witness after witness lied and that the government unfairly “demonized” him. And for the first time, he was a bit critical of the jury, saying he was “shocked” it deliberated only eight hours to reach its verdict, convicting him on all 26 counts after the two-month trial.
But prosecutors contended it was vintage Segal, blaming others instead of accepting responsibility for his misconduct.
“The strategy from the beginning has been to use his wealth and power to intimidate and smear anyone who had the courage to speak truthfully about his crimes,” Assistant U.S. Atty. Dean Polales said Friday. “He is in jail not for any political reason but simply because he stole over $30 million from a trust fund.”
On other issues raised at trial:
– Segal said he lent money to Chicago Ald. Burton Natarus (42nd) years ago after he came to him with “sob stories” of financial problems, but he said the transactions were above-board and posted on his books. He said Natarus never paid him back. Prosecutors contended Natarus was paid almost $140,000 with funds stolen from the trust fund.
Natarus couldn’t be reached for comment Friday, but he has denied receiving loans or gifts from Segal.
– Segal denied intervening with former Gov. George Ryan to try to ward off an investigation by state regulators of the trust fund woes.
– Segal said he may have given about a dozen politicians discounts on insurance over a decade, but he denied it was improper because he said it wasn’t an inducement to get them to buy insurance.
Segal said he sometimes second-guesses his decision not to testify at trial, but he feared prosecutors would question him about “personal issues” that he wouldn’t detail but said weren’t relevant to the case.
In spite of his reputation as a Chicago businessmen with ties to many politicians, Segal insisted he has no dirt to shovel to prosecutors about powerful friends, even if he wanted to do so.
“There’s been zoning investigations, there’s been tax investigations, Building Department investigations and court investigations, and I’ve never been near the peripheral of that,” Segal said. “I built a business of a thousand people. That’s where my passion has been.”
`One-two punch’
Segal described as “a one-two punch” the two consecutive days in June in which the jury convicted him and ordered him to forfeit $30 million and then U.S. District Judge Ruben Castillo had him jailed.
On his arrival at the Metropolitan Correctional Center, Segal said he felt “a little trepidation” on being placed in a holding cell with three other inmates, including one man just arrested for bank robbery.
The first night, Segal said he was put in a cell with “a gentleman who couldn’t speak that much English” and struggled to sleep.
He praised prison management but said life is regimented. He lives on a floor with about 80 other inmates.
An early riser, he’s up by 6 a.m. and in line for breakfast at 6:30 a.m. About an hour later, there’s an inspection to make sure his room is clean, he said.
Segal said he usually spends his day poring over documents from his trial, reading legal books such as “Trial and Error: The Education of a Courtroom Lawyer,” written by a former Chicago attorney, and discussing constitutional issues with other inmates.
All but his phone calls to his attorneys are monitored and limited to 15 minutes at a time and a total of 300 minutes a month, a limit he reached with two days left in July.
With competition intense over the four televisions on the floor, Segal said it’s difficult to watch programs he wants.
“That’s what I miss here,” he said. “I miss Fox News.”
Despite the stark contrast to his life on the outside, Segal said, “You can only eat three meals a day. You can only sleep in one bed. I sort of started with nothing. Sure, I would like to be out. I would be silly if I said this does not take an emotional toll, but I just have faith.”
