.....Donald Kernan Jr. — a campaign consultant and media adviser to the Davis campaign — was
charged earlier this month with 12 felonies and three misdemeanors for an elaborate check-kiting scheme at area banks.
Kernan also has done some campaign work in recent months for state Sen.
Lena Taylor, a Milwaukee Democrat also weighing a mayoral bid.
A criminal complaint accuses Kernan of writing 38 bogus checks for nearly $250,000 on a worthless business account, using those nonexistent funds to open accounts with at least five banks. He then quickly made actual cash withdrawals for himself and rang up debit card charges at high-end shoe stores such as
Christian Louboutin Boutique and
Giuseppe-Zanotti and at
Potawatomi Hotel & Casino — all before authorities caught up with him.
Kernan is accused of beginning the scheme in May and continuing it through August. Among the financial institutions that were hoodwinked by Kernan were
BMO Harris Bank,
Wells Fargo Bank,
Johnson Bank,
Associated Bank and
U.S. Bank....
"Investigators from the Milwaukee County District Attorney's Office are continuing to determine the full scope of defendant Kernan's fraudulent banking activities," the complaint says.
Kernan, who is in the Milwaukee County Jail, could not be reached for comment. He is being
held on a felony count of failing to appear in an unrelated Illinois criminal case....
Davis acknowledged in a brief interview last week that his campaign paid $12,100 to one of Kernan's firms,
Black Consulting, in the first half of the year, representing about half of Davis' total expenditures during that six-month span. Black Consulting was paid for campaign consulting, media work and a rental fee.
The Milwaukee alderman said he fired Kernan earlier this year and alerted prosecutors to his shenanigans.
"We did some background on him and found out he was not very forthcoming, and we turned over some information to the district attorney, so they took appropriate action," Davis said, declining to be more specific. "We did the right thing, Dan."...
Records show that Kernan
was charged in April 2014 with two felony counts of identity theft in Lake County, Ill. A warrant was issued for Kernan's arrest in February when he failed to show up in court.
Even before that, the states of Washington and Wisconsin issued
cease-and-desist orders against Kernan and his company,
DreamerTopia LLC, for
selling bogus financial products to several investors.
Those orders say a Washington resident sent Kernan about $30,000 — most of it from credit-card advances at 27% interest — to put into a Panama-based high-yield investment program called
Safe Depositary in hopes that he could raise enough money to pay for a medical treatment.
Authorities said Kernan used the "vast majority" of those funds for personal use. None of the money was ever forwarded to Safe Depositary, which turned out to be a scam program.
"Between approximately July 2011 and the date of this statement of charges, Kernan has raised at least $500,000 by means similar to those Kernan used to acquire the Washington resident's funds," said the March 2014 order from the State of Washington.
Among the others bilked by Kernan were two Wisconsin residents who sent him more than $12,500 each to invest in a private equity fund called
DTILP and who allowed him to apply for credit cards in their names. Wisconsin officials said he fell behind in paying the pair of investors, subjecting them to huge debts.
Kernan, who lived in Brown Deer, wasn't licensed to sell securities or act as an investment adviser. DreamerTopia
has an F rating from the Better Business Bureau.
Kernan, incidentally, is just 25.
"If you're anentrepreneur, or want to become one, I believe I have some insights and experiences that can help you make an incredible impact in the lives of others," Kernan says without irony
on his website, which lists him as an "investor, author and freedom fighter."....
Taylor said he reached out to her a while back. The Milwaukee Democrat said she hired him because she knew Kernan's father,
Donald Kernan Sr., a Milwaukee County deputy sheriff.
Federal records show the father has filed for bankruptcy twice.
