Investment Advisor to the Detroit Pension Funds Pleads Guilty to Conspiring with Former City Treasurer Jeffrey Beasley to Pay Him Bribes
|U.S. Attorney’s Office February 07, 2013|
Chauncey Mayfield, a former investment advisor to the two city of Detroit pension funds, pleaded guilty today to conspiring with former Detroit Treasurer Jeffrey Beasley to pay him bribes in exchange for new business from the pension funds, United States Attorney Barbara L. McQuade announced today. McQuade was joined in the announcement by Special Agent in Charge Robert Foley of the Federal Bureau of Investigation (FBI).
During a hearing this afternoon before United States District Judge Nancy Edmunds, Mayfield, 56, of Ft. Lauderdale, Florida, admitted that between 2006 and 2008, he had an agreement with the then city treasurer Beasley to pay bribes to Beasley and others to influence Beasley’s decisions as a trustee of Detroit’s Police and Fire Retirement System and General Retirement System.
Mayfield was the principal owner and chief executive officer of MayfieldGentry Realty Advisors L.L.C. (“MayfieldGentry”). MayfieldGentry was an investment advisor and fiduciary to the two Detroit pension funds overseeing a real estate investment portfolio worth more than $200 million of pension fund assets. According to Mayfield, Beasley agreed to maintain business for Mayfield’s company and to give Mayfield new pension fund business in exchange for cash others things of value. In particular, Mayfield gave $50,000 to the Kilpatrick Civic Fund. In addition, Mayfield paid for Beasley and others to take a trip to Las Vegas costing $60,000; paid for another private plane trip to Tallahassee, Florida, costing $24,000; paid for a private jet flight to Bermuda; and hired Beasley’s paramour to work at MayfieldGentry at Beasley’s request. Because of the pension fund business directed to MayfieldGentry by Beasley, Mayfield earned significant investment advisory fees from Detroit’s two pension funds.
United States Attorney McQuade said, “Detroit’s pension fund officials are entrusted to care for the retirement savings of the city’s employees, including police officers and firefighters. Officials who abuse their positions of trust for personal gain will be brought to justice.”
Robert Foley, Special Agent in Charge, Federal Bureau of Investigation said, “Those individuals who engage in pay to play schemes rob citizens of their right to honest government. The FBI-led Detroit Area Public Corruption Task Force is committed to stopping these illegal acts.”
Based on his guilty plea and felony conviction for conspiring to pay bribes, Mayfield is facing a maximum of five years in prison and a fine of up to $250,000.
A criminal indictment is pending against Beasley and against Roy Dixon, a former investment advisor to the two pension funds who paid bribes to Beasley and other officials and who embezzled millions from the funds.
In addition, a number of other defendants have been convicted in relation to the pension fund investigation, including (1) Monica Conyers, a former trustee of the General Retirement System and former member of the Detroit city council, for conspiracy to take bribes, including bribes relating to a proposed multi-million-dollar pension fund investment in Wireless Resources and a $10,000 extortion payment relating to the Police and Fire Retirement System’s investment in the Romulus Deep Injection Waste Well; (2) Samuel L. Riddle, Conyers’ chief of staff, for conspiracy to commit bribery and extortion relating to the Wireless Resources and Romulus Deep Injection Well investments; (3) DeDan Milton, a former trustee of Detroit’s two pension funds; (4) Andrew Park, an owner of Asian Village, who paid a bribe to obtain a $2.75 million loan from Detroit’s General Retirement System; and (5) Derrick Miller, former chief information officer of Detroit, who accepted the bribe from Park and who took a kickback of more than $500,000 on a $44 million investment by Detroit’s two pension funds.
The case was investigated by agents of the Federal Bureau of Investigation, the Internal Revenue Service, and the Department of Labor. It is being prosecuted by Assistant United States Attorneys Robert Cares and David A. Gardey.