Kwame Kilpatrick's former fraternity brother testified Friday that he paid Bernard Kilpatrick kickbacks from a pension fund deal because he felt he had to take care of the former Detroit mayor's father in order to obtain more consulting work in the city.
Marc Andre Cunningham testified this morning that he met Kilpatrick in the late eighties when both men were Alpha Phi Alpha fraternity brothers at Florida A & M University. Cunningham told the court that he spent several years working with Verizon in Chicago before moving to Detroit in 2004 at Kilpatrick's suggestion. The witness worked as an executive assistant to the former mayor between 2006 and 2008.
Read today's trail blog: Kilpatrick trial day 45.
Cunningham is a cooperating witness for the government. In November 2010, Cunningham pleaded guilty to one count of conspiracy to commit bribery after admitting he paid a Detroit public official's relative in order to get a $30 million pension fund deal. Under the terms of the plea agreement, he faces 30 to 37 months in prison. That sentence could be reduced for his testimony in this trial.
Cunningham testified that in early 2006, he became involved with Syncom, a venture capital firm based in Silver Spring, Maryland. A close family friend, Terry Jones, was a partner in the company. Jones, who the witness viewed as an uncle, hired Cunningham to act as a consultant for Syncom.
In order to raise funds for the firm, Cunningham introduced Jones to his childhood friend Jeff Beasley, onetime Detroit Treasurer who also sat on city pension fund boards. Syncom was able to raise $30 million from 2 separate funds: $15 million from Detroit's General Retirement System and another $15 million from the Police and Fire Retirement System.
For his efforts, Cunningham signed a 3 year contract for $300,000 to be paid in quarterly installments of $25,000.
Cunningham described to the court a meeting that took place at Mosaic restaurant in Detroit in the summer of 2006, around the same time the witness started his job as Kilpatrick's executive assistant. According to the witness, Kilpatrick, Beasley and Detroit businessman Chris Jackson were all at the restaurant. At that meeting it was suggested to him that he cut "BK"- Bernard Kilpatrick- into the $30 million pension fund deal.
And that was for doing nothing to help secure the deal said the witness.
Cunningham testified that he would cash his quarterly checks of $25,000 and pay Bernard between $3,000 and $5,000 at a time. The witness said that they met 5 or 6 times at discreet locations, including the barber shop in the basement of the City-Council building, to make the money exchange. Cunningham said he paid Bernard at least $15,000.
"That's kind of the way it was," explained Cunningham about what he felt were the rules of the game of doing business in Detroit. The witness felt that he might gain favor with the mayor if he looked out for his father.
In September 2007, Cunningham was alerted by a reporter with the Philadelphia Inquirer that he had been stung by an undercover federal investigation. Agents posing as out-of-state insurance businessmen offered the witness $5,000 in cash to help them do business in Detroit. Cunningham took the money and spent it.
A distraught Cunningham met Kilpatrick at the airport to alert him he'd been stung.
"Classic set up. You should have known better," Cunningham testified Kilpatrick told him.
The witness said that initially Kilpatrick encouraged him to find $5,000 and put it in the Kilpatrick Civic Fund (KCF) so they could get a receipt for it. But later, Cunningham testified, Kilpatrick changed his mind and told him not to put the money in the fund.
Then deciding that Cunningham was "too hot", Kilpatrick demoted him and sent him from his office to the city Film department. He also told the witness to stop making payments to his father.
And the paranoia about being spied on by the feds was reaching new heights. Cunningham had testified that he met Kilpatrick at the airport to tell him about the sting operation because he was afraid the office phones were compromised. In 2008, Cunningham said he went to visit Kilpatrick at the Manoogian Mansion when he learned his phone had been intercepted by the government. According to the witness, Kilpatrick ushered him outside by the river were they talked in code and covered their mouths as they spoke.
John Shea, Bernard Kilpatrick's lawyer, made sure that the jury understood that Cunningham was a cooperating witness who stood to gain from his testimony in this trial. Shea pointed out that as a result of testifying, Cunningham could get a reduced sentence and wasn't being charged for both lying to federal agents and paying kickbacks to Jeff Beasley. Very strong incentive for making prosecutors happy.
Shea also argued that Bernard had earned payment by helping guide Cunningham on the pension fund deal.
Jim Thomas, the former mayor's lawyer, got the witness to admit under cross examination that he couldn't be certain that Kilpatrick was at the Mosaic restaurant meeting in 2006. And if he wasn't there, said Thomas, then it couldn't have been he who suggested payments to Bernard.
Cunningham also admitted to Thomas that he never saw Kilpatrick with large amounts of discretionary cash.
"10 or 20 thousand dollars?!? No," laughed the witness.