Ex-mayor indicted on fraud charges

June 24, 2010|Associated Press

DETROIT — Former Detroit mayor Kwame Kilpatrick, already in state prison for probation violations stemming from his conviction for lying about an affair with his chief of staff, was indicted yesterday on federal fraud and tax charges for allegedly using his charity as a slush fund.

Federal prosecutors said the alleged scheme is related to the Kilpatrick Civic Fund, a tax-exempt fund that was supposed to pay for voter education and other purposes. Instead, they said, the former mayor took cash payments from the fund for himself, friends, and relatives. He is charged with filing false tax returns for 2003 through 2007 and evading taxes in 2008, according to the indictment.

Prosecutors accused Kilpatrick, a Democrat, of failing to report at least $640,000 in taxable income between 2003 and 2008, which includes money, private jet flights, and personal expenses paid by the civic fund.

The government said he used the money to pay for yoga and golf lessons, camp for his children, personal travel, moving expenses, and “countersurveillance and antibugging equipment.’’

Kilpatrick spokesman Mike Paul said the Kilpatrick family was aware that the indictment could be coming. He said it shows that after three years investigating Kilpatrick, federal officials did not charge him with public corruption linked to his job as mayor, proving that those allegations were only rumors.