The suspended police chief and public works director in southwest suburban Summit both pleaded not guilty Thursday to conspiracy charges alleging they took more than $5,000 in bribes from a bar operator to grease a liquor license transfer in the village and then attempted to cover it up.

John Kosmowski, 54, of Lockport, and William Mundy, 59, of Summit, were each charged last month with one count of bribery conspiracy.

Kosmowski, who earns about $225,000 a year as police chief and has worked for the Summit Police Department for more than 30 years, was also charged with one count each of bribery and obstruction of justice.

Mundy, who doubles as a building inspector and earns a $117,000-a-year salary, is also charged with one count of filing a false tax return.

Both defendants entered pleas of not guilty through their attorneys during a telephone arraignment before U.S. Magistrate Judge Beth Jantz.

According to the village, both men were suspended from their duties on the day the indictment was announced and are on unpaid leave pending the outcome of the case.

The indictment alleged Kosmowski and Mundy conspired to accept more than $5,000 from the business owner in 2017 in exchange for helping secure the transfer of a liquor license to another person.

According to the charges, Kosmowski received a cash payment from the business owner on March 23, 2017, and then gave Mundy a portion of it.

Two months ago, after being made aware of a grand jury investigation into the payment, Kosmowski met with Mundy in nearby Justice to tell him the government would be “indicting soon” and that it “was going to be their version against ours,” according to the indictment.

During the meeting, Kosmowski tried to persuade Mundy to lie about the payment by saying it was a loan, the indictment stated.

While the business owner is not named in the charges, public records and sources confirm he is Mariano Martinez, the clout-heavy owner of several suburban businesses who pleaded guilty in 2019 to selling a kilogram of heroin to a man in a Berwyn laundromat for $50,000.

As part of his guilty plea, Martinez admitted to paying bribes to two Summit officials, who at the time were not named in court records.

The charges are an offshoot of a larger corruption probe that netted indictments of Chicago Ald. Edward Burke and then-state Sen. Martin Sandoval.

Sandoval pleaded guilty to separate bribery charges before he died of COVID-19 in December 2020.

Martinez, who has ties to a longtime political operative for both Burke and Sandoval, cooperated with prosecutors and was sentenced last year to 18 months in prison. Before that, he ran Mars Bar, in the 6000 block of South Harlem Avenue in Summit, and owned car washes and other businesses in the area.

jmeisner@chicagotribune.com