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In this Nov. 2, 2016, file photo, former McLean County Board Chairman Matt Sorensen and his wife, Lisa, pass through security as he makes an appearance in the U.S. Federal Courthouse in Chicago. Prosecutors will ask that he serve a prison term for wire fraud when he is sentenced on Tuesday.

PANTAGRAPH FILE PHOTO

CHICAGO — Federal prosecutors will ask that former McLean County Board Chairman Matt Sorensen serve about two years in prison when he is sentenced Tuesday on wire fraud charges.

Sorensen pleaded guilty in November to conspiring with co-defendant Navdeep Arora to defraud McKinsey & Co., a large Chicago consulting firm, of unearned consulting fees. Sorensen and Arora, who also has pleaded guilty to wire fraud, are equally responsible for restitution of $490,975 to McKinsey, according to terms of the plea agreement.

Sorensen's defense attorney Stuart Chanen filed a memorandum Friday asking for probation, noting Sorensen's decades of public service and saying he was the victim of a con perpetrated by Arora.

The fraud scheme began around 2002 after Sorensen, a former internal consultant with State Farm, began working with Arora, who oversaw McKinsey's work on State Farm projects.

Starting in 2007, Arora "became more desperate for work from State Farm," according to a sentencing recommendation submitted this week by Sunil Harjani, assistant U.S. attorney for the Northern District of Illinois, and obtained by The Pantagraph.

The two men developed a fraudulent billing scheme for consulting work allegedly performed by Andy's BCB, a company owned by Sorensen. Arora charged the phony consulting fees to State Farm and one other McKinsey client and those firms paid Sorensen's firm about $38,265 in fees — with most of the money kept by Sorensen, said the federal report.

A second company, Gabriel Solutions, was formed for the sole purpose of billing McKinsey for fraudulent services.

Total billing to McKinsey amounted to $452,710, of which $370,000 was kept by Sorensen, said prosecutors.

In addition to the money he received from the false invoices, Sorensen and his wife also were taken on two vacations by Arora to Napa, Calif., and New York.    

In their search for a motive for the crimes, federal investigators determined that Sorensen was paid in exchange for providing internal State Farm information on consulting contracts, including information on other firms who were competing for the same work sought by McKinsey.

A series of emails attached to federal court filings show how Arora pressured Sorensen to push for more consulting contracts with State Farm.

"Remember, things don't happen unless you and I orchestrate them," Arora said in a June 22, 2010, email.

The disclosure of confidential information by Sorensen was a breach of State Farm's trust, the federal prosecutor argued.

Sorensen, 51, was fired from State Farm in 2012 and Arora left McKinsey the same year. Both men were indicted in August 2015.

"Sorensen's crime is serious and worthy of a substantial term of imprisonment. His scheme went on for at least three years, allowing for many opportunities for contemplation and reflection," according to the sentencing report.

With a State Farm salary of about $150,000, the money from the fraud scheme was a substantial financial boon for Sorensen, noted the prosecutor.

"A sentence involving no incarceration will be a slap on the wrist for Sorensen and will not be a significant punishment for him," the government concluded.

In his interviews with State Farm about the scheme, the former McLean County official "did not come clean but instead made up a false list of work he had done on behalf of Gabriel Solutions to purportedly justify his fraudulent invoices," according to the government's sentencing report.

The government argues the fact that Sorensen is in good health, has a stable family life and lacked the incentives that drive many people to commit crimes is not a factor in his favor.  

"Rather, it appears that he saw his relationship with Arora as a way to benefit himself, and that the sums of money being fraudulently charged were relatively small and would go unnoticed," states the court filing.   

The sentencing report filed by Sorensen's lawyer says State Farm was reimbursed by McKinsey for the fraudulent invoices, but the Bloomington-based insurer is seeking $2.5 million for the cost of its internal investigation into the fraud case. The federal government is not recommending restitution to State Farm, based on the amounts previously agreed upon in plea agreements with the two defendants. 

But the substantial time and cost incurred by State Farm and the negative impact the case has had on the company should be considered a factor in imposing a sentence, according to Harjani.

The federal case against Sorensen came after he served more than 20 years on the County Board where he was known as an able negotiator who achieved board consensus on many issues. He also provided the leadership and support for the county's ongoing efforts to reform community mental health services.

Follow Edith Brady-Lunny on Twitter: @pg_blunny

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Reporter for The Pantagraph.