Pagano Stole $475K, Says Metra

Executive director committed suicide in early May

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    NEWSLETTERS

    Former Metra chief Phil Pagano cashed out vacation allotments each year, without regard to whether he actually intended to take time off, board says. (Published Friday, May 14, 2010)

    The Metra Board was informed Friday that Executive Director Philip Pagano, who committed suicide a week ago, improperly took advances on vacation pay totaling at least $475,000, beginning in 1999 through January 2010. 

    Independent counsel James Sotos said when financial officials at Metra began asking questions about the practice, Pagano forged Metra chairman Carole Doris' signature on at least two authorizing documents.

    Sotos said Pagano routinely cashed out roughly 80 percent of his yearly vacation allotment at the beginning of each year, without regard to whether he actually intended to take time off. 

    "And since 2007, he has been cashing out all of it," Sotos said.

    It was in January of this year that Sotos said Pagano produced two forged documents.  One of them was intended for an advance he had already received on his 2010 vacation.  The second document involved the paperwork for a 2011 advance.
     
    "Pagano has admitted that he forged Chairman Doris' signature on both memos because he did not think she would grant his request," Sotos said.

    What started as routine cash payouts in the earliest part of Pagano's Metra career, the report says, eventually led to "blatantly illegal requests for advanced payouts for unearned vacation days, and the commission of acts of forgery in order to obtain those funds."

    In receiving the report, Doris said everyone held deep affection for Pagano and that the investigation turned the page on a painful chapter at the agency.

    “The course we have taken is difficult, but it is the right thing to do," Doris said. "It is a privilege to serve the public trust, and sometimes it is a very heavy burden, but we accept that responsibility.”

    In addition to the advances on vacation pay, Sotos said Pagano took out hundreds of thousands of dollars in loans on future deferred compensation and insurance, which even now may have to be repaid.

    Sotos released only the executive summary of his report, saying the U.S. Attorney had asked him to hold the full report, pending a possible criminal investigation.  He said he had provided a copy of the full document to Attorney General Lisa Madigan.
     
    Board member Jack Schaefer asked to speak and sang Pagano's praises as an administrator who virtually created Metra from nothing and who made "eleven clocks chime at the same time."

    Quoting Shakespeare, Schaefer declared, "The good men do is interred with their bones, but the evil lives on forever.  I don't think that's fair."

    Sotos' report concluded that no other Metra employees had benefited from similar practices.  But it also branded the Pagano affair a "troubling lack of oversight and accountability which needs to be remedied."

    There was only one allusion to Pagano's suicide. Sotos lamented what he called a culture of trust which had grown around Pagano, "which curtailed any hope that he would be held accountable."

    "Ironically, it was Mr. Pagano who paid the ultimate price for the creation of that culture," he said. 

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