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Hotel Pere Marquette developers found guilty of fraud and money laundering

Hotel Pere Marquette is one of the dozens of hotels in the Peoria area that was hit hard by the lack of visitors when stay-at-home orders and COVID-19 safety mitigations were in place.
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Hotel Pere Marquette is one of the dozens of hotels in the Peoria area that was hit hard by the lack of visitors when stay-at-home orders and COVID-19 safety mitigations were in place.

Two Peoria men behind the redevelopment of the Hotel Pere Marquette and construction of the Courtyard by Marriott were found guilty of mail fraud and money laundering in federal court Friday.

The verdict marks the end of the jury trial of developers Gary Matthews and Monte Brannan. Matthews was found guilty on five mail fraud charges and 12 of the 13 counts of money laundering he and Brannan jointly faced.

Brannan pleaded guilty to three additional counts of concealment of bankruptcy assets late last week. He was found guilty on all 18 additional counts of money laundering and mail fraud on Friday.

Federal prosecutors say the pair misused millions in lender and city of Peoria funds for personal and business expenses over a roughly six year period of development. After the hotels’ completion, they say the pair moved more than $13 million from a hotel management group to a privately controlled bank account, in violation of an agreement with the city of Peoria.

The city of Peoria provided a $29 million grant coupled with a $7 million loan for the project. The city will not see that $7 million returned.

“The jury recognized that the taxpayers, city of Peoria, senior lenders and the Marriott Corporation were victims of Matthews’ and Brannan’s crimes,” said representatives of the city of Peoria in an emailed statement.

The statement also acknowledges the hotels are still major economic drivers for the downtown area.

The statement ends: “With new owners in place, the city is working to ensure that the future of the Hotel Pere Marquette is sustainable and economically successful.”

The hotels were purchased by Texas investment firm Shreem Capital earlier this week.

It remains to be seen what sentence Chief Judge Sara Darrow will hand down for Matthews and Brannan. The mail fraud and money laundering charges have statutory penalties of up to 20 years' imprisonment, though it's likely the men would face far less. Matthews is 81, and Brannan is 70.

Sentencing for both men is scheduled for Mar. 27, 2024.

The bankruptcy fraud charges carry sentences of up to five years' imprisonment. Each charge also carries a possible fine of up to $250,000.

Collin Schopp is a reporter at WCBU. He joined the station in 2022.