As part of its ongoing investigation into former Detroit Mayor Kwame Kilpatrick, the FBI recently subpoenaed a Southfield TV station for a video clip in which Kilpatrick denied he had misused the Kilpatrick Civic Fund. Kilpatrick had started the fund in 1997 with some friends with the aim of increasing the number of young voters aged between 18 and 35 and to improve Detroit’s neighborhood and image.
The video tape in question was that of a mayoral debate between Kilpatrick and Gil Hill that took place on September 25, 2001 moderated by Chuck Stokes editor director of WXYX-TV (Channel 7). The footage clearly shows Kilpatrick saying that the fund had never been abused by being used for his mayoral campaign. He said that he had “followed every rule, every regulation of the IRS, who regulates us” and that “not one penny” was used for his mayoral campaign. Experts say that the FBI may want the video as proof to show that Kilpatrick was not ignorant of the IRS regulations.
Even with the evidence of the video tape, it is unclear to what extent Kilpatrick may be involved in corruption in the city. Thus far, the FBI’s extensive investigation already has produced bribery convictions in the $1.2-billion Synagro Technologies sludge-disposal deal, Cobo Hall contracting and in the sale of city real estate.
Wayne State University law professor Peter Henning said that in similar cases, it is common for suspects in these white collar crimes to deny knowledge of the law as a form of their defense. But the video footage is clear. In it, Kilpatrick said, “I would not mess with the IRS, but just to be safe we sent the information to the attorney general and secretary of state, who’ve both given us a clean bill of health and said we followed all the rules and regulations. We haven’t used one penny, one penny, of civic fund in this campaign because it’s not allowed by law.”
The FBI has been investigating the possible misuse of the civic fund for several years but the subpoena gives the clearest indication that Kilpatrick may be in jeopardy for any wrong committed.
The abuse of the fund could have taken various forms. It might have been used for Kilpatrick’s personal expenses. In 2007, Detroit city officials admitted the fund was used to pay $8,605 for Kilpatrick’s family accommodation in a posh California resort. But it defended the expense saying that Kilpatrick was on a trip to raise more money for the fund. Another form of abuse would be not declaring any financial gain from the fund in Kilpatrick’s income tax returns.
Kilpatrick could be fined or face criminal prosecution if it was proven that he had misused the civic fund.
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Law Offices of Darrin T. Mish, P.A.: Tax Attorney