The scandal that haunts Kankakee
We’ve heard about the scandal at for months. 600+ pages of proof, evidence, and documents. Yet there is still so much unanswered about what is really going on at The Haunted Factory and ACERE (American Center for Emergency Response and Education). Why there are still children in there sweeping proven asbestos. Why ACERE under-reported their gross annual income on their form 990 tax return for 2018 as $18,915. Despite a super majority of the board of The Haunted Factory being in agreement that their fundraiser alone brought in close to $50,000 over 10 days. How the venue operated a haunted house without meeting fire code.
The state inspects
On September 18th of 2019 the Office of the Illinois State Fire Marshal inspected the property at 980 N. Hobbie Ave. in Kankakee, and that report was released 8 days later. Full report available here: https://imgur.com/a/NsLhj9D Did ACERE really fix 60+ violations to the NFPA and life safety code in less than 2 weeks? The answer is no. It is unlikely that they even fixed one. While a significant amount of work went into the sprinkler system, it was never made operational due to it being a fire pump system. Which would require its own electricity service or a dedicated commercial generator[via Illinois Department of Labor]. Neither of which were furnished. It was stated by a representative of ACERE that city of Kankakee had certification of the sprinkler system being tested and working, which they did not. Nor did the Illinois Department of Labor or the State Fire Marshal [via FOIA]. In the inspection report from the Illinois Department of Labor, Full report available here: https://imgur.com/a/D2KkF2c , on October 8th of 2019 it is noted that they were relying on a statement that the sprinkler system was tested and working but they were doubtful of the legitimacy of that claim. Many pictures of crumbling asbestos, hazards, and failures were also documented within the pathways of the haunted house during that inspection.
The IDOL has stated that local officials were pushing for the haunted house to pass the inspection despite their findings, stating they have seen this situation before and suggested the media and elections may be the only options. The haunted house opened 4 days after the complete failure of the inspection. Another violation to the NFPA and life safety code included using the interior of the building for assembly which was prohibited due to the requirements of egress being 100% of the crowd width for assembly use. The State Fire Marshal reports the main entrance to be only 35 inches wide. Would a panicked crowd be able to safely exit through a 35 inch door in a emergency? Other legal haunted houses host their line assembly separate from the attraction due to fire code, typically under a open ended tent to meet egress laws. It appears that local corruption is to blame for the disregard of any sort of rules that apply to others. Including using children as young as 11 in the haunted house. It is specified on the application that no one under 16 may work as an actor in a haunted house. With that rule being further clarified in the FAQs, it applies to both for profit and not for profit haunted houses. https://www2.illinois.gov/idol/FAQs/Pages/haunted-house-faq.aspx#qst5 While a haunted house may be fun the reality is that patrons are often under the influence and underage actors from The Haunted Factory have reported being touched and grabbed inappropriately.
Questions were raised about the haunted house obtaining a permit in the past
“Any person who owns or operates an amusement ride or amusement attraction at an event open to the public without having obtained this permit to operate from the Illinois Department of Labor or who violates any order or rule issued by the Director or Board under the Carnival & Amusement Ride Safety Act (430 ILCS 85) is guilty of a Class A misdemeanor. Each day shall constitute a separate and distinct offense (Section 2–15 of the Act).” — Illinois Department of Labor
In a phone interview with the Illinois Department of Labor on September 3rd of 2019, following a FOIA reply that turned up no documents, it was stated that no permit had ever been applied for or issued from 2013–2018 for the haunted house attraction, it was an illegal haunted house. This seems to conflict with statements made by Kankakee Fire Captain Michael Casagrande, who was the secretary of ACERE from 2012–2018. Originally in a phone interview on September 5th of 2019, Casagrande denied the allegations made by the Illinois Department of Labor. Casagrande stated that there is a special department that I was unaware of and he got the permits every year; everything was legal. I informed him that I contacted the Illinois Department of Labor, special amusements division looking for the permits and exemption forms. When I had requested copies of those permits from Casagrande he stated that he no longer had them, gave them away. In a later interview with The Daily Journal https://www.daily-journal.com/news/local/haunted-house-failed-to-get-permit/article_fb8d31f0-e53d-11e9-9139-b3550a6524cb.html , Casagrande appeared to have changed his story. Stating that he only got the paperwork ready for the group [referring to the board of The Haunted Factory which was formed in 2018] and he didn’t know if they sent it in or not. This also contradicts a much older incident in September of 2018, when The Haunted Factory received an e-mail from the Illinois Department of Labor about attempting to run a haunted house without a permit. That e-mail was forwarded to Casagrande by Troy Trost [board member of The Haunted Factory], Casagrande then “took care of it”. Which the board interpreted as him having obtained the permit. The haunted house had operated for years under the assumption that Casagrande was running a legal haunted house and taking care of all necessary paperwork. When I had requested assistance in dealing with the issues with ACERE, during the September 5th interview; Casagrande stated that he would have no further involvement with ACERE and would not be doing any inspections on the property anymore. Later he was witnessed several times on the grounds consulting with the operators of the haunted house. His name was also found on an inspection report dated October 21st of 2019, the property allegedly passed fire inspection with no working sprinkler system and many other violations noted by the patrons of the event.
That report may be the most damning piece of evidence of a coverup. While it should have been included with a FOIA request from November 3rd of 2019, it was not. That particular report was posted online by the president of ACERE as proof against the many allegations of the scandal. The November 3rd FOIA uncovered a series of inspection reports which city of Kankakee had previously denied having via FOIAs. Part of the FOIA request included permits for another local haunted house, St. Pat’s Haunted High School, with Casagrande having signed off for the IDOL application and another inspector requesting certification of the sprinkler system having been tested.
It seems that Casagrande was aware of haunted houses having to meet fire codes and having inspections in the St. Pats situation, but the haunted house that benefited his own organization was not subject to the same rules. Unfortunately the Illinois Attorney Generals Office has informed me that the statute of limitations has passed to pursue legal action against city of Kankakee for denying existence of those FOIA documents. It appears that despite his statements, Casagrande is still quite involved with ACERE. When Kankakee building department attempted to intervene on October 10th of 2019, due to the unpermitted work being done at the property, they were denied access. Told by Alex Paterakis [the new board president of ACERE] to talk to Casagrande. Later jobs were threatened if the building department attempted to intervene again. A board member has stated that they were unhappy that Casagrande “threw us under the bus” but had to be careful because they need Casagrande. Casagrande has since stopped responding to any requests for comment.
The IRS’s take on fraud
In a document published by the IRS titled “How to lose your 501(c)(3) tax-exempt status (without really trying)”, several ways to lose your tax exempt status are listed including:
….
Private benefit:
A 501(c)(3) organization’s activities should be directed toward some exempt purpose. Its activities should not serve the private interests, or private benefit, of any individual or organization more than insubstantially.
Inurement:
A 501(c)(3) organization is prohibited from allowing its income or assets to benefit insiders — typically board members, officers, directors and important employees of an organization. If an organization benefits insiders, the insiders and the organization could be subject to penalty excise taxes and the organization could lose its tax-exempt status.
….
Link to IRS document here: https://www.irs.gov/pub/irs-tege/How%20to%20Lose%20Your%20Tax%20Exempt%20Status.pdf
Trying to dodge the IRS
The new president of ACERE, Alex Paterakis, had stated in a meeting between him and the board of The Haunted Factory on December 14th of 2018; that his plans are to use this building to eventually turn a profit. Which is prohibited by the IRS. Cecil Carroll, former president of ACERE, had stated in May of 2018 that the intent of the coming take over was for airsoft, stating they planned to “use the s**t out of it” most weekends. Airsoft being a sport similar to paintball in which plastic pellets are used. Paterakis stated that he planned to host several airsoft events per month but could only legally advertise one of the events each month due to the not for profit status. Stating he may look into alternative methods of payment such as volunteer time as a work around. Patrons of these events have stated that their payment did not go to ACERE but went to Paterakis’s business MiR Tactical. Witnesses have confirmed airsoft events being conducted most weekends throughout the season, with the new business being titled The Airsoft Factory. Board members of The Haunted Factory have stated that the help and volunteers they were promised early on from Paterakis was never provided, with him only attending for the airsoft events. The purpose of ACERE has always been vague. Prior to 2012 ACERE operated under another name, Illinois Center for Emergency Services Education or ICESE,[Link to The Daily Journal story about ICESE from 2005] still operating under Casagrande. From 2005–2012 ICESE operated with the same intent and promises as ACERE,[Link to The Daily Journal story about ACERE from 2013] to turn the old general foods building at 980 N. Hobbie Ave into a training center. It is unclear why the name was changed.
ACERE’s questionable mission
ACERE has a published mission statement with the IRS of: “TO PROVIDE EDUCATION, RESPONSE AND RECOVERY TO COMMUNITIES DURING TIMES OF NATURAL AND MAN MADE DISASTERS, UTILIZING VETERAN AND CIVILIAN PERSONNEL. THE ORGANIZATION WILL TRAIN THOSE WHO SEEK CAREERS IN EMERGENCY SERVICES WITH AN EMPHASIS ON SUPPORTING THE ONGOING NEEDS OF OUR VETERANS.”
There are years of statements about allegedly converting the building into a training center for our first responders; from time to time when the subject of the dilapidated building pops up, the usual suspects chime in to deceive the public by claiming its full of training props and active training events. Defending the airsoft events, for profit photography tours, and the haunted house. Yet volunteers and board members have stated they are only there for a haunted house and airsoft. Having never built anything for training nor heard of any sort of training events being actively conducted there. When questioned about the mission statement the general response for years has been “next year”. Those that question the legitimacy of ACERE rarely are called back. Few first responders seem to be aware of the facility, and even less have been there. Do airsoft sporting events, a haunted house, or for profit photography tours have a relationship with ACERE’s mission statement? The photography tours are hosted by a local photographer who charges $50 per person for unrestricted access to the grounds and buildings. With attendees having been witnessed on the water tower, in the 8th floor catwalk that connects the main building to the grain silos, and on the roof. Of that money $40 goes into the event hosts pocket and $10 goes back to ACERE, with the event host stating that he was unhappy that he has to give any back to ACERE. Typical turnout for the photography tours are 30 people.
Part of the scam or a victim of pride
In a phone interview with Paterakis on January 10th of 2019; Paterakis had concerns that The Haunted Factory being a separate entity from the not for profit, may end up being a conflict of interest for ACERE. When questioned about the money the haunted house raised he said that Troy and Ann Trost, who are two of the seven board members of The Haunted Factory and volunteered to take on the duties of secretaries and treasurers, had records ready for him fast after the takeover in December of 2018. Stating that they seemed surprised when he requested records. This is contrary to the narrative being pushed by them to the rest of the board in the previous months where the Trosts denied having kept much for records and refused examination of what they did have. The Trosts were offered relief from the duties they volunteered to take on when it was apparent they were in over their heads. Offers were made by other board members to take on the task of setting up the corporation but were quickly denied. With Ann Trost stating that they had already taken care of it. It was revealed a week before the 2018 haunted house event that they had never even attempted to set up the corporation. When questioned about the money they would only respond with “its all there”, referring to a safety deposit box that no other board members were allowed to see or audit. The board has questioned if it ever existed. No audits of money at the end of each night were allowed like in all previous years, and unsuccessful attempts were made to keep counts of patrons from the rest of the board. Major problems began on October 26th of 2018, a back tax bill that Casagrande had sworn for years that he had paid with the proceeds from past haunted houses, was paid by the Trosts without board approval in the amount of $16,562.75 The tax bill stemmed from ACERE not having been granted tax exempt status by the state of Illinois thus was still responsible for paying property taxes on 980 N. Hobbie, until the 2015 tax year when their tax exempt status was recognized. Cecil Carroll was under the impression that no one from ACERE knew of the tax bill, though members of The Haunted Factory had complained to Casagrande about the growing tax bill for years. Even offering to help out with it since The Haunted Factory depended on the building, but Casagrande reassured each month when the bill grew; that it was just a mistake. The board felt that it should have been taken care of with the money raised from the 2017 haunted house, that 4 day event had brought in $18,000. It was no secret that Casagrande wanted out of ACERE, it was speculated that he was using this tax bill as an opportunity to walk away, until Paterakis made an offer.
Another bill for insurance was also paid in the amount of $1,500. Which was followed by a statement from the Trosts that these two bills allegedly took all of the money. This was a problem for the board because of the patron count. Approximately $40,000 had been raised by that point. Just days prior to the January 10th interview with Paterakis, the Trosts were going to begin compiling spreadsheets of the finances to appease the dissent of the board. Those spreadsheets have never been produced. The total income that Paterakis stated on January 10th of 2019, from the 2018 haunted house event, was “between 20 and 30 thousand dollars”. Which again seems to conflict with the gross income on the 990 tax returns for 2018 of $18,915, and also statements from the board of the event alone bringing in close to $50,000 over the 10 day run. The evidence appears to confirm speculation among the board of premeditation. The board had what is known as fiduciary duty, which includes duties to investigate, report, and mitigate financial issues. To impede those duties constitutes misconduct. Paterakis has been unwilling to investigate the many allegations from board members of embezzlement and misconduct following his unresearched conclusion of there being no issues.
Paterakis’s many issues with running legitimate events and run ins with the law
Paterakis seems to have many issues with ethical behavior and the law. Hosting events in other places with proven asbestos like Tinley Park Mental Health Center, and Northridge Mall in Milwaukee. Tinley Park Mental Health Center recently came into the news after the Illinois EPA refused to enter buildings due to asbestos and mold. https://patch.com/illinois/tinleypark/asbestos-found-throughout-tinley-park-mental-health-center-site The site was on lockdown and no one allowed access without permission from the Illinois Department of Central Management, and a respirator; when Paterakis [through his company, MiR Tactical] hosted an event there in November of 2019. Attendees were surprised to find that, while full use of the facility was heavily advertised including interiors of buildings, they were only allowed limited sections of outdoor areas. In a phone interview with a representative of Tinley Park on February 12th of 2020, it was stated that an environmental study was conducted on the facility in 2014 [at the price of about $130,000] and asbestos was found then. Tinley park was unaware of the November event. The Milwaukee game, titled “The Milwaukee Offensive” was originally scheduled as a 2 day event to be held on September 7th and 8th of 2019. During the game on the 7th, Milwaukee PD shut down the event and removed everyone from the property. Paterakis was witnessed attempting to impede the police from their duties. The city had a no entrance order on the facility as it had been officially condemned early in the year. https://www.jsonline.com/story/money/real-estate/commercial/2019/04/11/milwaukee-issues-condemnation-order-former-northridge-mall/3428560002/ On July 22 of 2019 a maintenance worker died in the facility after being electrocuted by live wires in the abandoned mall pushing the city to actively enforce the order. https://www.cbs58.com/news/milwaukee-man-fatally-electrocuted-while-working-at-former-northridge-mall There were issues with asbestos and airborne black mold documented in news articles prior to the event. Many patrons were happy to discuss the details of the event and their disgust, including being directed to hide their vehicles behind the building, but none were willing to go on the record. Many have been unhappy with events being falsely advertised to include aspects, such as night games, that are later removed from the fliers following final ticket sales. With the company having a policy of no refunds. Many have accused MiR Tactical of simply being a cash grab operation. Lately the police have had to intervene in Paterakis’s business. Not one, but two instances of illegal online gambling have been shut down by Buffalo Grove. A search of facebook revealed 9 illegal for profit raffles that were publicized in facebook videos between July of 2019 and February of 2020, and references to a gambling wheel located within the business based on spending certain amounts of money for chances to win. In Illinois, games of chance or lotteries are gambling. Requiring any sort of exchange of money for a chance to win is a federal crime. It is unclear why Paterakis continued the operation after being caught the first time. There are more references to illegal raffles at past and upcoming events on MiR Tactical’s website, requiring a purchase to be entered. Only bonafide not for profits, who have a raffle license in the respective city where the raffles are being held, are allowed in Illinois and most other states. MiR Tactical currently has an injunction filed against in the 19th Judicial Circuit Court of Lake County by the former company owner, Roman Botashoff. The case being titled Botashoff vs. Paterakis. Botashoff could not be reached for comment.
Paterakis denies issues with asbestos despite compounding proof
Paterakis has denied that his building [at 980 N. Hobbie Ave.] contains any asbestos; providing a sample report with himself listed as the sampler, that appear to be from an entirely different project in Buffalo Grove. This sample also being dated a month after his initial claim of having had samples tested and proof.
Paterakis has also made statements to the Illinois EPA and Illinois Department of Public Health that he has environmental consultants supervising all work being performed within the property to make sure nothing is disturbed; though a board member of The Haunted Factory has stated that no one like that has ever been there. Leadership has claimed to the volunteers, who are mostly children, that there is no asbestos or concerns and not to believe anything being published. Phone calls were made to every licensed asbestos contractor within reasonable distance listed on the IDPH’s website https://data.illinois.gov/dataset/376idph_asbestos_licensed_contractors and none of them had any recollection of being at the property. Some were quite upset to find out there were kids in there sweeping what in their professional opinion was asbestos. Stating that the samples already collected showing Chrysotile and Amosite asbestos within the pathways of the haunted house were more than adequate proof. Describing it as a time bomb with a 10–30 year incubation period. Stating that in a building like that, standards are to assume everything to be asbestos until proven otherwise. Some were aware of the building and knew it to be full of asbestos. It was uncovered through these phone calls that a company called Hall-Kimbrell was the last company to do any certified asbestos sampling in the building in the mid 90s. Their sampling areas are found on every piece of suspected asbestos insulation throughout the facility, serialized as HKxxxxxx on red duct tape covering the sample cores. The specific practice being confirmed by a former Hall-Kimbrell employee now working for Intertek PSI Inc. Unfortunately Hall-Kimbrell has been defunct since the late 90s and those specific sample reports were searched for but are believed to have been ruined in a flood.
Attempts to reach the agent for Lincoln Fields Enterprises [who initially sold the property for Quaker Oats], were unsuccessful. Lincoln Fields Enterprises is listed as a mesothelioma risk site along with Gainesburger, General Foods, and other past names of 980 N. Hobbie. Ave.
In the inspection report from the Illinois Department of Labor on October 8th of 2019, there was a photograph of what appeared to be freshly re-wrapped asbestos lagging.
While a homeowner may legally do some levels of abatement and encapsulation in their dwelling, a commercial building open to the public is an entirely different situation requiring licensed contractors and permits. Though it is not illegal or always dangerous to have asbestos in a building, asbestos that is crumbling, falling off pipes, and being swept by children certainly falls into its own special category. Many incriminating statements were witnessed by Paterakis on facebook, such as stating that people must have broke into his building to get asbestos samples, which Paterakis had to subsequently delete. Seemingly implying his knowledge of the asbestos problems in his building. A few years ago a situation in a similar building was investigated by the US EPA. A former Pillsbury Mills in Springfield, Illinois; was the subject of similar public concern. With dangerous asbestos being improperly handled. A video tour was provided to WAND TV https://youtu.be/5F4L5LN5hi4 Volunteers from The Haunted Factory [who have watched the video]have said it was just like being back in the factory[referring to 980 N. Hobbie]. The owner of the former Pillsbury Mills was sentenced to 3 years prison Link.
Who’s scamming who?
Requests were made to current board members of The Haunted Factory for comment on the situation, but they were unwilling to go on record. Prior to the initial release of information to the public in 2019 the board was happy to discuss embezzlement of money, calling for an audit and suspecting collusion from those accused and the new board of ACERE. Raising questions of why two of the board members had background checks and financial discoveries run on them but not the rest. The suspicion being that they were being put on the payroll of ACERE or MiR Tactical, yet the rest of the board was not. One of the suspects being witnessed calling Paterakis “boss”. The board was aware of the not so secret plan for the facility to be taken over for airsoft, despite an outlandish claim from one board member about a secret and illegal ex parte meeting where she was allegedly informed that airsoft was not going to happen there. Board members suspected that statement to be a ploy for damage control because of what the evidence was showing, to try to damage credibility. A friend and colleague of Casagrande had also stated on December 5th of 2018 that Casagrande told him of the airsoft plan long before the coming takeover. It seems something has spooked the board members. Perhaps the slander and libel that has been witnessed from certain members of The Haunted Factory and ACERE was a deterrent. A former board member, Stan Schiel; the only one of the seven to resign his position, was happy to talk about his time with The Haunted Factory and ACERE. When asked if he had any regrets about leaving the board he only had one, that was helping them for 4–5 years prior. “I feel they owe a lot of their success to the few that were always there for them, and we were all betrayed.” He was not happy about being mislead and not knowing where the money went. Stating “…to this day ACERE hasn’t done squat. Even with the current emergency[referring to COVID-19] throughout the world. They have done nothing.” When asked about the IDOL inspection further confirming the asbestos and statements from volunteers having been told the state inspection reports were fake and there is no asbestos he says; “Someone lies. Someone should be held accountable.” When asked about leadership from The Haunted Factory attempting to censor the public on their facebook page; “They’re trying to cover stuff up. They don’t want to look like the liars and idiots that they are.” It seems that morals are not as valued with the rest of the board.
Accountability
Its been 15 years since the announcement that the old General Foods factory was being converted into a training center. Many people have dedicated their time under false pretenses to this project to find that their only objective is to organize a haunted house. Many have walked due to promises being made but not kept and money being unaccounted for. Some have been vocal about it and suffered slander, libel, and threats of frivolous lawsuits. When will those responsible for this deception be held accountable? Most importantly, what will the future be like to those that were most heavily exposed to the asbestos? Will ACERE be there for them in the future? ACERE has been highly criticized by insiders as being a fraudulent not for profit. Which the evidence seems to confirm. Paterakis has made many statements over the last year about debunking all of the allegations, yet has never provided much more than statements that can be classified as tomorrow or trust me. Only providing a few discredited documents and fraudulent reports. Sometimes telling people to FOIA for documents he knows do not exist, not expecting anyone to take him up on it. Seems like the idea, much like the tax documents he’s often referenced but files for every extension possible, is to just keep delaying and hoping people will forget.
-Jeff Hutson