(WWJ) – A Howell man is facing charges of conducting a criminal enterprise and false pretenses for allegedly billing the city of Detroit more than $1 million for backfill dirt used for demolition projects.
David MacDonald, 50, is accused of getting the dirt for free and from contaminated sources, then charging the city through a contract with the company Den-Man.
In 2017 MacDonald was employed by Den-Man to lead the company’s demolition program. He was responsible for finding backfill for all the demolition sites in the company’s contract with Detroit, according to Attorney General Dana Nessel’s office.
The contract made Den-Man responsible for backfilling the sites of demolished properties with dirt from approved sources, and the company was “entitled to bill the city for the acquisition price of that dirt.”
MacDonald repeatedly claimed to have paid for dirt used at these sites, but the AG’s office says he had obtained it at no cost, lied about the source of the dirt, and billed the Detroit Land Bank Authority for “fictitious sums.”
Den-Man received over $1.1 million for reimbursement for backfill material without actually incurring those costs, Nessel’s office said.
While the alleged unapproved source of backfill material is considered environmentally contaminated, officials did not identify where it was from.
Those sites now must be tested for their environmental quality, officials said.
“These crimes, a scam against the people of Detroit and abuse of public funds, amount to public harm for private greed,” Nessel said, per a press release. “We have a responsibility to protect public funds from abuse, and to protect already vulnerable neighborhoods from environmental attacks.”
The investigation was completed by the Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP), which is a federal agency tasked with preventing and detecting fraud, waste, and abuse in the federal funds appropriated by Congress through the Emergency Economic Stabilization Act and the Consolidated Appropriations Act of 2016.
MacDonald is charged with one count of conducting a criminal enterprise and 11 counts of false pretenses.
DLBA has agreed to repay $1 million due to monitoring issues in the program.
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