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SEC sues ex-Detroit mayor for influence peddling
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WASHINGTON — Former Detroit Mayor Kwame Kilpatrick is facing federal civil charges of taking part in an influence-peddling scheme involving the city’s public-employee pension funds.
The Securities and Exchange Commission says Kilpatrick and ex-city treasurer Jeffrey Beasley received $125,000 in private jet travel and other perks from an investment firm. The SEC says that was in exchange for getting the city’s pension fund to make an investment favoring the firm.
Kilpatrick says he’s innocent of these charges and separate criminal charges brought previous by the Justice Department.
“I truly believe that all of the entities involved in these ‘so-called’ investigations know that I have done absolutely nothing wrong,” Kilpatrick said in a Facebook message to the Associated Press.
MayfieldGentry Realty Advisors, the investment firm, asked the pension funds’ trustees to invest $117 million in a real estate investment trust controlled by the firm, the SEC said.
The SEC also accused the investment firm and its CEO, Chauncey Mayfield, of taking part in the influence-peddling scheme in violation of federal securities laws. It said the firm received millions of dollars in management fees from the pension funds’ decision to invest.
Kilpatrick and his father are accused of taking kickbacks and bribes to steer city business to certain contractors. Their corruption trial is set for September in federal court in Detroit.
Beasley was indicted in January on federal criminal charges of extortion, attempted extortion and conspiracy related to investments by the city employee pension funds.
The agency said Kilpatrick and Beasley “secretly solicited and received lavish gifts” from Mayfield and his firm, including a trip by private jet to Las Vegas with luxury hotel accommodations, concerts and rounds of golf.
The SEC is seeking unspecified fines and restitution from the four defendants, and an injunction barring Kilpatrick and Beasley from participating in any decisions involving investments by public pensions
• Associated Press writers Ed White and Corey Williams in Detroit contributed to this report.
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