Springfield Man Pleads Guilty to Bankruptcy Fraud

Mark A. McFarland, 58, of Springfield, IL, pled guilty on February 21, 2017, to two counts of bankruptcy fraud in U.S. District Court in East St. Louis, capping a years-long scheme to exploit the federal bankruptcy system. The guilty plea, announced by United States Attorney Donald S. Boyce, exposes how McFarland repeatedly lied under oath, falsified documents, and filed in improper jurisdictions to manipulate court proceedings and shield his failing business, Second Chance of Springfield, Inc.

McFarland was indicted on February 2, 2016, as part of a broader crackdown by the U.S. Attorney’s Office targeting fraud in the U.S. Bankruptcy Court for the Southern District of Illinois. The case traces back to October 6, 2014, when McFarland filed a Chapter 11 bankruptcy petition on behalf of Second Chance—claiming the business operated in the Southern District. But the truth was buried in the paperwork: the business was headquartered in Springfield, solidly within the Central District of Illinois, where McFarland had already abused the system.

Prior to the 2014 filing, McFarland had initiated 10 separate bankruptcy cases in the Central District—all but one dismissed due to his repeated failure to comply with court orders. In the final case, the court slapped a 180-day filing ban on him, forcing him to seek refuge elsewhere. That’s when he turned to East St. Louis, lying on the initial petition by claiming his business operated in the Southern District. When challenged by the U.S. Trustee’s Office, McFarland doubled down—submitting an amended petition with a sham address in Alton, IL, backed by a lease fraudulently backdated to September 25, 2014.

At his plea hearing, McFarland admitted he never signed the lease on that date and never reached an oral agreement with the landlord as claimed. He confessed to perjuring himself under oath—twice—about the Alton location, attempts to buy time and legitimacy in a jurisdiction that never should have seen the case. Each lie was a calculated move to evade accountability and keep his failing venture afloat through deception.

“Making a false statement in a bankruptcy proceeding is a crime that threatens the integrity of the bankruptcy process and public confidence in that process,” stated Nancy J. Gargula, U.S. Trustee for Region 10, which oversees Central and Southern Illinois and Indiana. The U.S. Trustee Program, a division of the Justice Department, referred the case to federal prosecutors after uncovering the inconsistencies, sparking an investigation led by FBI agents out of the Springfield Division and the Fairview Heights Resident Agency.

McFarland’s sentencing is set for June 6, 2017, at 1:30 p.m. in East St. Louis. He faces up to 5 years in prison, a $250,000 fine, restitution, and up to three years of supervised release. The case was coordinated through the Southern Illinois Bankruptcy Fraud Working Group, a multi-agency effort designed to root out abuse in one of the most vulnerable corners of the federal legal system. For McFarland, the cost of deception is finally coming due.

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