U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 22844 / October 15, 2013
United States v. Kilpatrick et al., Criminal Case No. 10-20403 (E.D. Mich.)
Securities and Exchange Commission v. Kilpatrick et al., Civil Action No. 12-12109 (E.D. Mich.)
Former Detroit Mayor Kwame Kilpatrick, Previously Sued by the SEC for Fraud, Sentenced to 28 Years in Prison
The Securities and Exchange Commission announced that on October 10, 2013, U.S. District Judge Nancy Edmunds sentenced former City of Detroit Mayor Kwame Kilpatrick to 28 years in prison. A jury had previously convicted Kilpatrick of racketeering, conspiracy, fraud, extortion, and tax crimes in March 2013. The U.S. Attorney's Office for the Eastern District of Michigan originally filed criminal charges against Kilpatrick on December 14, 2010.
Kilpatrick is a defendant in a pending civil injunctive action filed by the SEC on May 9, 2012 in the United States District Court for the Eastern District of Michigan. The charges leveled by the SEC stem from facts also alleged by the U.S. Attorney's Office. The SEC's complaint alleged that Kilpatrick and former Detroit Treasurer Jeffrey W. Beasley, who were trustees to the city's public pension funds, solicited and received $125,000 worth of private jet travel and other perks paid for by MayfieldGentry Realty Advisors LLC, an investment adviser whose CEO Chauncey Mayfield was recommending to the trustees that the pension funds invest approximately $117 million in a real estate investment trust (REIT) controlled by the firm. Despite their fiduciary duties, neither Kilpatrick and Beasley nor Mayfield and his firm informed the boards of trustees about these trips and the conflicts of interest they presented.
For further information, see Litigation Release No. 22362 (May 9, 2012).