SEC Sues Kilpatrick For ‘Influence Peddling’
DETROIT (WWJ/AP) - Former Detroit Mayor Kwame Kilpatrick is facing federal civil charges of taking part in an influence-peddling scheme involving the city’s public-employee pension funds.
The Securities and Exchange Commission says Kilpatrick and ex-city treasurer Jeffrey Beasley received $125,000 in private jet travel and other perks from an investment firm. The SEC says that was in exchange for getting the city’s pension fund to make an investment favoring the firm.
Kilpatrick and Beasley violated federal securities laws, the SEC alleged in a civil lawsuit filed Wednesday in federal court in Detroit.
Lawyers for Kilpatrick, Beasley and Mayfield didn’t immediately return phone calls seeking comment
MayfieldGentry Realty Advisors, the investment firm, asked the pension funds’ trustees to invest $117 million in a real estate investment trust controlled by the firm, the SEC said.
Kilpatrick and Beasley were among the trustees. The SEC says the two should have told the other trustees that they received perks from the investment firm.
The SEC also accused the investment firm and its CEO, Chauncey Mayfield, of taking part in the influence-peddling scheme in violation of federal securities laws.
“The penalty for this, it’s not jail this time — it’s money,” said WWJ Legal Analyst and Talkradio 1270 host Charlie Langton Kilpatrick. “And besides the $125,000 that’s mentioned in the complaint, the fines could be far more.”
“Also, I think that this is just the tip of the iceberg,” he added. “There’s a lot of money in the pension fund and for many, many years Kwame Kilpatrick had appointees and had some control. This could even get bigger.”
Kilpatrick and his father are accused of taking kickbacks and bribes to steer city business to certain contractors. Their corruption trial is set for September in federal court in Detroit.
Nonetheless, Kilpatrick seemed update, posting oh his Facebook page, “Today, be patient with yourself. You are changing little by little. Be Encouraged. No Condemnation! And to hell with what ‘They Say!’ Much Love!”
Kilpatrick still owes Detroit more than $850,000 in restitution from a 2008 plea in a separate criminal case.
He currently lives with his family in the Dallas suburb of Grand Prairie, Texas.
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