DETROIT (WWJ) – A former top Wayne County official accused of using kickback money to buy things like designer clothes and pricey hair plugs has been sentenced to prison time.
Michael Grundy, 40, of Detroit, will spend seven-and-a-half years in federal prison as part of a plea deal with prosecutors.
Grundy was executive director of HealthChoice, a county health program for the needy and an assistant county executive until fall 2011.
He pleaded guilty to a conspiracy charge last month; and charges of extortion and money laundering were dropped in exchange.
Federal prosecutors said Grundy set up a kickback scheme in 2008 that allowed him to collect almost $700,000. According to a 25-count federal indictment, he spent the money on several items including electronics, airline tickets, Louis Vuitton clothes, $10,000 hair plugs and a time share in the Caribbean. The indictment also charged that Grundy used “deception and fear” to extort a company that had contracts with HealthChoice.
In addition to the prison time, Grundy was also sentenced to three years probation, ordered to pay $500, 000 in restitution, and to forfeit a Detroit property, a Jeep and $7,755 — all of which prosecutors say can be traced back to the fraud.
“The citizens of Wayne County deserve honest services from their public officials,” said U.S. Attorney Barbara McQuade in a media release. “It is particularly offensive when corruption comes from officials entrusted to promote health and welfare. We will continue to prosecute public officials who enrich themselves instead of serve the people.”
The case was investigated by agents of the FBI and IRS.
Said IRS-CI Special Agent in Charge Jarod J. Koopman, “IRS-CI is committed to investigating those public officials that choose to steal funds earmarked for public programs in order to enrich themselves.”
Co-conspirator Keith Griffin previously pleaded guilty to wire fraud, admitting he provided the kickbacks.