James Ortman of Maple Rapids Sentenced to Prison for Submitting False Claims to the Federal Government
|U.S. Attorney’s Office June 11, 2014|
GRAND RAPIDS, MI—U.S. Attorney Patrick A. Miles, Jr. announced today that James Francis Ortman, 58, of Maple Rapids, Michigan, was sentenced in U.S. District Court to 24 months’ imprisonment for submitting false claims to the U.S. Department of Housing and Urban Development (HUD). As part of his sentence, Ortman was also ordered to pay restitution to HUD in the amount of $235,412. When imposing his sentence, the Hon. Janet T. Neff commented that “these kinds of crimes really are corrosive to our trust and our faith in our government.”
“When used appropriately, HUD grants encourage development and new job opportunities in our local communities,” said U.S. Attorney Miles. “This office will vigorously pursue those who seek to line their own pockets by diverting from their intended purpose scarce grant monies that are funded by the hard-working taxpayers of this district.”
Ortman’s false claims related to grants that were administered by the City of St. Johns and the Michigan State Housing Development Authority (MSHDA) and ultimately funded by HUD. Ortman received the grants to improve the facades of various buildings that he owned in downtown St. Johns and to construct apartments for income-qualified individuals. In order to receive the full amount of the grants, Ortman submitted false invoices and other documents making it appear as if he spent more money on the projects than he actually did. This allowed him to divert grant monies to his various business interests, instead of spending the money on the intended purposes of the grants.
Mr. Barry McLaughlin, Special Agent in Charge, HUD-OIG, stated that his agency has “redoubled our efforts at combatting fraud within grant programs intended to justly benefit the people of Michigan. Mr. Ortman’s sentencing signals the start of our initiative to reduce this growing crime.”
“Theft of HUD grant funding amounts to stealing from hard-working taxpayers,” stated Paul M. Abbate, Special Agent in Charge of the FBI Detroit Field Office. “The FBI, in concert with our law enforcement partners, remains dedicated to pursuing those who selfishly misappropriate public funds intended for the public good.”
The Detroit office of the U.S. Department of Housing and Urban Development-Office of Inspector General, along with the Lansing Resident Agency of the FBI, investigated the case. The prosecution of the case is being handled by Assistant U.S. Attorney Ronald M. Stella.