Steinberg-Baum?

Photo: Steinberg-Baum

One could get the impression that the block southeast of the Ninth Street & South Grand intersection has always been "run down". A visit to that neighborhood today would reveal a large parking lot for ABF trucking. The entire southeast side of the block is a fenced field of weeds, and aging asphalt. The neighborhood has known better days. Back in the 1960's, and early 1970's what is now a vacant wasteland hosted a bustling retail center - The Steinberg-Baum Company Discount Store.

I remember as a young child shopping at Steiberg-Baum. It was a large store, with great prices - or so I was told. The store was always filled with shoppers. So whatever became of the store? I asked that question of my parents shortly after the store closed down. I was told that the owner's were "crooks", who hadn't paid their taxes, and several had "skipped the country" whatever that meant.

I ran a google search, not really believing I'd find anything, but there's no escaping Google. The following material (somewhat edited for readibility) was obtained from here:

Former Illinois Department of Revenue employee Sidney Flaxman CPA, and four former officials of the Steinberg-Baum Company were named in an eight-count indictment charging conspiracy and mail fraud. The indictment alleged that false retailers' occupation tax returns had been submitted to the State of Illinois. From January 1, 1968, through January 30, 1971, the returns submitted had understated sales by approximately $32 million, resulting in a loss of revenue to the State of Illinois of roughly $1.5 million.

There were thirteen retail stores, each of which was a separate corporation. According to Flaxman, when he first prepared a retailers' occupation tax return and showed it to Louis Steinberg, president of the companies and named in the indictment as a co-conspirator, Steinberg told him that he had not taken into account the wholesale sales. From a notebook, Steinberg gave Flaxman the amounts of wholesale sales which he, Steinberg, said should have been deducted.

The wholesale sales amounts furnished by Steinberg were fictitious and generally amounted to 90% Of the total sales.

There was evidence from General Manager Freedman that Steinberg-Baum's policy was to report only about 10% Of actual retail sales.

Also, by mailing the false tax returns to, "Retailers' Occupation Tax Division, 400 South Spring Street, springfield, Illinois 62706" they were guilty of mail fraud.

And now we know the rest of the story.