A $4 million settlement has been awarded to the son of a man who spent decades in prison for a Gold Coast murder he did not commit.

The murder of 24-year-old Gold Coast resident Dana Feitler became a symbol of the violence that engulfed Chicago in 1989.

It happened the day before Feitler was to begin graduate school at the University of Chicago to earn an MBA, which she hoped would lead to a career as a hospital administrator.

Under intense pressure to solve the case, Chicago police charged Lee Harris, a convicted robber turned police informant who was later wrongfully convicted of Feitler’s murder. Harris spent more than 33 years in prison before being exonerated eight months before his death.

The City Council’s finance committee agreed Monday to pay $4 million in compensation to Harris’ son, Jermaine Harris, for police and prosecutorial misconduct that resulted in his father being charged with a murder he did not commit.

“God, I’m sorry that someone was punished for a crime they didn’t commit. How can I feel good about this?” said Robert Feitler, the victim’s father. “My daughter was killed. It’s something you can’t overcome. But punishing the wrong person is terrible. And frankly, when he went to prison, it won’t bring our daughter back.”

During Monday’s Finance Committee meeting, Deputy Corporation Counsel Jessica Felker described a heinous and still unsolved 1989 crime that made national headlines.

Feitler was abducted as she returned to her Gold Coast apartment building. She was taken at gunpoint to a nearby ATM and forced to withdraw $400 before being shot in the back of the head and left for dead in an alley. She remained in a coma for three weeks before she died.

Harris was known to the two officers assigned to investigate Feitler’s murder, as he was those officers’ informant about unrelated crimes.

He initially spoke to officers about a week after the murder. After learning that there was a large reward for the case, Harris told police that he had information about Feitler’s murder but feared for his safety if he gave the information to police.

Over the next few weeks, Harris gave police various “accounts” of the shooting, which he later denied were true. Harris initially told police he saw two men in the alley near the ATM at the time of the shooting and identified the two. He was taken for a polygraph test based on this version of events, and it failed.

Over the next few weeks, Harris was questioned by several detectives and continued to blame others. He was then driven to the alley where Feitler was killed. Only then did Harris admit that he was in the same alley when Feitler was shot. He claimed that he saw the two men he had accused earlier and a third man rob and shoot Feitler.

A second polygraph was performed. Harris passed the second test. The police and prosecutors then provided him with housing, “a small amount of money” and food.

“Harris claims that this food, money and housing were used to induce him to make more false statements,” Felker said.

“About four months after the murder, Harris told detectives that he was the third person involved in the robbery-turned-murder.” He told police that an accomplice wanted to kill her and he and a third man “wanted to let her go.”

An eyewitness subsequently identified Harris from a list and was “pretty sure” he was one of the perpetrators.

On March 6, 1992, a jury found Harris guilty, although there was no physical evidence linking him to the crime.

At trial, prosecutors argued that Harris admitted to another inmate while in Cook County Jail that he shot Feitler in the head when she screamed after refusing to have sex with him.

When Judge John W. Crilley announced the 90-year sentence, Feitler’s family rejoiced and Harris’ wife tearfully proclaimed her husband’s innocence.

“I know he didn’t do it. They picked the wrong person,” Veronica Harris said that day.

In a statement read in court by his lawyer, Harris said he was sorry for the Feitler family’s “tragic loss” but insisted he “had no role in it.”

In 2015, a Guardian investigation accused Richard Zuley, the lead detective, of using “unorthodox”, often brutal interrogations to extract false confessions. The publication reported that Zuley took part in interrogations using military torture at Guantanamo Bay.

Felker called the $4 million a “cost-effective solution” to the case.

“We’re avoiding defense costs, which if the case goes to trial would likely be around $3 million. … There is evidence pointing to another suspect. There is a prison informer who recanted his testimony,” Felker said.

Noting that Harris spent 33.5 years in prison, Felker said the $4 million payment amounts to “just under $120,000 per year of incarceration.”