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Insurance company claims Wyndham hotel damage was inside job, refuses to cover losses

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* Some background from a WAND TV report in March

The Wyndham Springfield City Centre is temporarily closed one day after WAND News reported that lawmakers had to leave their stays early due to water pouring through the elevators.

Springfield Fire Chief Ed Canny told WAND News that the hotel does not currently have working sprinklers, fire alarms, or elevators. Due to the code violations, no guests will be allowed to stay until the issues are resolved.

SFD was initially called for a fire alarm, but found no fire. It was during this investigation that the department found the broken equipment.

The Springfield Police Department is currently investigating the damage to the hotel as intentional vandalism.

* And now a new bombshell report from WAND

New court filings accuse the owner of the Wyndham in Springfield of intentionally vandalizing his own hotel, causing serious water damage to the property. […]

(I)n June, hotel owner Al Rajabi sued his insurance company, claiming Affiliated FM Insurance was stalling to pay the claim. Rajabi said he was losing thousands of dollars on cancelled reservations and events.

However, Affiliated FM filed a countersuit against Rajabi Monday night.

The company said it hired a private investigator who determined, “Mr. Rajabi colluded with others to cause the damage, and/or the damage was caused by other individuals with the knowledge of Mr. Rajabi.”

Mr. Rajabi’s lawsuit is here.

* From the insurance company’s counter-suit

FM AFFILIATED retained Michele Sutphin, of Legacy 1811 Investigations and Consulting, to assist in its investigation. Ms. Sutphin conducted an extensive investigation on behalf of FM AFFILIATED. Ms. Sutphin’s investigation included, but was not limited to, interviewing numerous people, including former employees of the Hotel. Ms. Sutphin’s investigation also included, but was not limited to, the review and analysis of documents and information. Ms. Sutphin’s 4 August 2025 summary report, which details her investigation and findings, is attached. […]

FM AFFILIATED has determined that the vandalism and resulting loss and damage that occurred in the early morning of 27 March 2025 at the Hotel was intentionally caused by Mr. Rajabi, Mr. Rajabi colluded with others to cause the damage, and/or the damage was caused by other individuals with the knowledge of Mr. Rajabi. Accordingly, there is no coverage.

FM AFFLIATED’s conclusion is based on the entirety of its investigation, including, but not limited to, the findings of Ms. Sutphin as summarized in her 4 August 2025 report, the interview memoranda prepared by Ms. Sutphin and provided to FM AFFILIATED, the testimony under oath of Ms. Wray, Mr. Reimer, and Ms. Kienzler, as well as other documents and information provided to FM AFFILIATED. […]

As explained above, the vandalism and resulting loss and damage that occurred in the early morning of 27 March 2025, at the Hotel was intentionally caused by Mr. Rajabi, Mr. Rajabi colluded with others to cause the damage, and/or the damage was caused by other individuals with the knowledge of Mr. Rajabi. Accordingly, there is no coverage.

In addition, there were willful misrepresentations and concealments of material facts. Mr. Rajabi represented to FM AFFILIATED that two individuals who are former employees were likely involved in causing the loss and were being investigated by the local police. Mr. Rajabi also represented to FM AFFILIATED that the loss was likely caused by disgruntled employees without his knowledge. Further, Mr. Rajabi concealed his involvement causing the damage, as well as his conduct and actions leading up to the loss. Finally, through his misrepresentations and concealments related to this loss, Mr. Rajabi intended to deceive FM AFFILIATED or materially affect the claim. Accordingly, there is no coverage.

posted by Rich Miller
Wednesday, Aug 27, 25 @ 12:50 pm

Comments

  1. This is the first explanation of that event that, um, holds any water.

    Comment by Excessively Rabid Wednesday, Aug 27, 25 @ 1:00 pm

  2. “Then, finally, when there’s nothing left… And you can’t borrow another buck from the bank or buy another case of booze. You bust the joint out. You light a match.”- Henry Hill, Goodfellas

    Comment by Frida's Boss Wednesday, Aug 27, 25 @ 1:10 pm

  3. It’s getting easier and easier to see how the supposed deal made with the previous mayor, involved some questionable numbers not discovered until that mayor left office. Looking back, while the short term pain is real, it’s probably a good thing the city never agreed to a deal with this guy.

    Comment by fs Wednesday, Aug 27, 25 @ 1:12 pm

  4. I scrolled through the insurance company’s response hoping to find the memo for its private investigator. Sadly, it was not included. I guess we’ll have to wait until trial to learn more about how this went down.

    But Rajabi was able to squeeze $4 million out of that insurance company from the lightening strike in 2024, despite the insurance company saying minimal damage was caused. If he tried to scam the insurance company (and that’s for a jury to decide), doing it twice in a year wasn’t the best idea.

    Sadly, Springfield needs that hotel back up and running. Just hopefully with new owners and management.

    Comment by 47th Ward Wednesday, Aug 27, 25 @ 1:16 pm

  5. Sounds like the owner is in serious trouble. It’s been a springfield eyesore since the 1970s. Now is as good as time as any to tear it down and build something better in its place.

    Comment by Steve Rogers Wednesday, Aug 27, 25 @ 1:17 pm

  6. ===hoping to find the memo===

    Same. Isabel also looked at court filings. Not there either.

    Comment by Rich Miller Wednesday, Aug 27, 25 @ 1:20 pm

  7. Springfield activist and regular City Council public commenter Ken Pacha had interesting discussion about the Wyndham vandalism report in his address at Committee of the Whole last night (he starts about 1:10:44 into the video). And used the report to emphasize the importance of Springfield adopting a landlord registry.

    https://www.youtube.com/watch?v=wLA4aAJPFDA&t=3208s

    Comment by Leatherneck Wednesday, Aug 27, 25 @ 1:26 pm

  8. Springfield is the most depressing city in Illinois outside of Danville.

    Not surprised by this news.

    Comment by Blockclub Wednesday, Aug 27, 25 @ 1:27 pm

  9. I thought Rockford was bad until I visited extended family in Springfield. Woof.

    Comment by blockclub Wednesday, Aug 27, 25 @ 1:28 pm

  10. Can’t decide which party I trust less in this: the insurance company or the landlord.

    Comment by Irreverent Wednesday, Aug 27, 25 @ 1:43 pm

  11. Move the capitol to Naperville!!

    Comment by NotRich Wednesday, Aug 27, 25 @ 1:47 pm

  12. Sounds like a criminal case. Maybe Bondi could swing into action

    Comment by Annonin' Wednesday, Aug 27, 25 @ 1:59 pm

  13. And the Double Tree is taking advantage of the Wyndham closure and have hiked up their rates well beyond what they should be charging for that place.

    Comment by Chicago Voter Wednesday, Aug 27, 25 @ 2:29 pm

  14. =Springfield is the most depressing city in Illinois outside of Danville=

    Few communities of Danville’s size have as many really cool events. Great lake, many excellent golf courses, vastly improved parks, newly renovated astroturf ballfields, fantastic soccer complex, lowest cost of living literally anywhere. A Community College whose campus looks like a high end liberal arts four year university.

    The drive by pot shot is bush league and ill informed.

    Comment by Easy Scooter Wednesday, Aug 27, 25 @ 2:46 pm

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