Michigan men accused of stealing from federal demolition program
DETROIT (FOX 2) - Two Michigan men are facing charges after authorities say they used schemes to steal funds that were allocated for demolition work in Detroit and Flint.
David Jeremy Gillespie, 39, of Detroit, and David Holman, 48, of Metamora, are accused of separate schemes to defraud the federal Troubled Asset Relief Program (TARP). This program provides funds to contractiors demolishing buildings in areas hard hit by financial crisis, the Michigan Attorney General's office said.
Gillespie's company, Detroit Environmental Solutions, LLC, allegedly fraudulently purported to be a distinct entity from another business, BBEK Environmental (BBEK), to satisfy requirements of TARP funded demolition contracts procured by BBEK.
These contracts required air quality monitoring to be conducted by an independent third-party business, a critical requirement when dealing with asbestos and other harmful particles. It is alleged that this business was funded by and operated by principals of BBEK, and the intent was to keep air testing expenses within the scope of revenue for BBEK.
He is charged with one count of conducting a criminal enterprise, one count of lying to a peace officer, and three counts of false pretenses.
Holman is accused of operating a scheme that fraudulently billed TARP and the City of Detroit more than $1,000,000 for dirt used to fill demolition sites that his company, Den-Man Contracting, obtained for free from prohibited or unknown sources.
Man accused of filling Detroit demo sites with contaminated dirt, billing city for $1+ million
A Howell man who worked for a company contracted by the city is accused of billing the City of Detroit for backfill dirt while he used dirt from contaminated sites at demolished properties.
Authorities allege that Holman knew this was in violation of city contracts, yet failed to ensure the backfill was not contaminated.
The City of Detroit has paid more than $3,500,000 to test the sites where Den-Man Contracting’s prohibited-source dirt was used. Eighty-seven of those properties have failed testing standards for contaminants. Fifty-one residential properties remain untested.
Holman is charged with one count of conducting a criminal enterprise and 11 counts of false pretenses.
"Criminal enterprises target public funding programs, where hundreds of thousands, or even millions, of dollars are awarded in contracts to fulfill public work," Attorney General Dana Nessel said. "We must vigilantly defend public funds from abuse and criminal greed, especially when those crimes impact public health and safety. I am grateful for the investigative work of the Detroit Office of Inspector General, the Special Inspector General for the Troubled Asset Relief Program, and the investigators in my office for their work to defend public funds and public health."