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untanglingwebs
El Supremo
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Former Career Alliance head spared prison time in embezzlement case
Gary Ridley | gridley@mlive.com By Gary Ridley | gridley@mlive.com
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on December 03, 2013 at 5:05 PM, updated December 03, 2013 at 5:06 PM
FLINT, MI -- A federal judge spared prison time for the former head of Career Alliance after she pleaded guilty to embezzling federal funds from the career service agency.
Pamela Loving was ordered Tuesday, Dec. 3, to pay more than $586,000 in restitution and serve five years of probation -- including one year of house arrest -- by Flint U.S. District Judge Mark A. Goldsmith.
Loving, 70, pleaded guilty in June to embezzling federal funds from the career services agency. Loving, the former president and chief executive officer of Career Alliance, now known as Genesee/Shiawassee Michigan Works, admitted to taking roughly $77,000 from the organization for her personal benefit and to pay for training sessions for people who did not work for Career Alliance.
However, federal authorities claimed that Loving inappropriately distributed funding to programs not authorized by the Department of Labor, forcing Career Alliance to repay more than $500,000 to the state.
Loving's attorney, Richard Morgan, said that his client is currently going through a bankruptcy and is unemployed. He declined to elaborate on how Loving planned to pay back the restitution.
"She's going to pay what the court ordered her to pay," Morgan said.
Morgan argued during the hearing that Loving should be spared prison time because only roughly $13,000 was used for Loving's personal benefit. However, Goldsmith said Loving also benefited by using her position with Career Alliance to advance socially in the Flint community.
"There was a significant amount of funding that ended up benefiting (Loving) either in a monetary way or a non-monetary way," Goldsmith said.
Goldsmith declined to sentence Loving to prison, despite sentencing guidelines that called for 10-16 incarceration. However, Goldsmith said his sentence sends a strong signal that this type of crime would not be tolerated by the court.
"The offense was a serious one and the law that she violated does need to be respected and vindicated," Goldsmith said.
The federal statute Loving pleaded guilty to violating allowed for a maximum of two years in prison.
Goldsmith also declined to force Loving to pay restitution for a judgment she received after suing the agency despite a letter from current Genesee/Shiawassee Michigan Works CEO Craig Coney asking for the funds.
Flint Journal records show Loving was placed on unpaid administrative leave from her position at Career Alliance in 2007 and never returned. She won a $154,000 judgment in 2008 against Career Alliance because she claimed her contract had been effectively terminated.
Goldsmith said he would not allow the restitution because he did not believe the judgment was attributed to her criminal conduct.
Morgan argued that attorney's for Career Alliance had the chance to challenge the payment to his client and that it would be inappropriate now for the judge to order Loving to pay back the judgment.
"Hindsight is always 20/20," Morgan said of the lawsuit, adding that his client has already spent all of the money.
County, state and federal investigators reported chronic mismanagement and improper spending at Career Alliance after a series of Flint Journal stories in 2007 detailed problems at the organization.
Career Alliance serves as a job-training agency for Genesee and Shiawassee counties as well as the city of Flint and is responsible for millions of dollars for employment programs.
Last month, former Flint school board member, Helen Williams was sentenced to two years probation after she pleaded guilty to embezzling funds from Career Alliance.
Williams served as executive director of Flint Family Road, an organization started with the goal of reducing infant deaths by better preparing parents to be mothers and fathers, according to Flint Journal files.
She admitted in court to falsifying invoices to get money from Career Alliance contractors for services she never provided. Williams admitted in court to embezzling more than $88,000.
Williams served on the Flint school board for seven years, before resigning in 2001.
In a 2008 letter questioning spending at Career Alliance, the Michigan Department of Labor and Economic Growth said it had been informed Helen Williams was a cousin of Loving and that Family Road was given rent-free space in Career Alliance's Ruether Center.
Williams was sentenced Oct. 17 by Flint U.S. District Judge Mark A. Goldsmith to also pay more than $240,000 in restitution.
QB Pittman, Career Alliance's former chief Financial officer, was sentenced Oct. 24 in U.S. District Court to one year probation ordered to pay $91,321.46 in restitution after Pittman pleaded guilty to misapplication of Workforce Investment Act funding.
Pittman said in court that he did not directly benefit from the money taken, but also admitted he did nothing to stop it. |
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Tue Dec 03, 2013 9:59 pm |
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untanglingwebs
El Supremo
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Career Alliance saga ends with no jail time for those who misused $500,000 in taxpayer money
Gary Ridley | gridley@mlive.com By Gary Ridley | gridley@mlive.com
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on December 08, 2013 at 6:00 AM, updated December 08, 2013 at 9:53 AM
FLINT, MI -- A scandal that took down the head of a public agency, a Flint police chief and his father, as well as a former Flint School Board member has come to end with more than $500,000 in taxpayer money misused and not a single day of jail for anyone involved.
Pamela Loving, the former head of Career Alliance who a federal judge called the leader of the "criminal episode," was ordered to pay back more than a half-million dollars after she admitted to embezzling tax-payer money and funding a program led by a relative without approval of the federal government.
U.S. District Judge Mark A. Goldsmith, however, spared Loving from more than a year in prison and instead placed her on five years' probation with a year of house arrest.
Loving, who is unemployed and has filed for bankruptcy, was also ordered to pay $586,000 in restitution.
The fact that Loving and the other three people convicted in the Career Alliance case were not given any jail time upset Genesee County Commission Chairman Jamie Curtis.
"What kind of message do you send to the county for committing crimes like that?" Curtis said. "If you can put them in jail then they should be in jail."
Josh Hauxhurst, head of the Federal Bureau of Investigation's Flint office, said while he is happy that there were convictions in the case he would have liked to see stiffer sentences handed down.
Goldsmith declined to comment on the Career Alliance case.
Loving's sentence closes the book on the FBI's investigation into the misuse of federal government workforce development funds and the agency.
County, state and federal investigators reported chronic mismanagement and improper spending at Career Alliance -- now known as Genesee/Shiawassee Michigan Works -- after a series of Flint Journal stories in 2007 detailed problems at the organization.
Career Alliance serves as a job-training agency for Genesee and Shiawassee counties as well as the city of Flint and is responsible for millions of dollars for employment programs.
Loving admitted to taking roughly $77,000 from the organization for her personal benefit and to pay for training sessions for people who did not work for Career Alliance.
However, federal authorities claimed that Loving inappropriately distributed funding to programs not authorized by the Department of Labor, forcing Career Alliance to repay more than $500,000 to the state.
Loving's attorney, Richard Morgan, said only $13,000 of the misappropriated funds went directly to Loving and that jail time wasn't appropriate, particularly in light of her decades of service to residents of Flint.
"The sentence was absolutely just," Morgan said. "The lady spent 20 years working in that community."
Goldsmith also declined to force Loving to pay restitution for a judgment she received after suing the agency despite a letter from current Genesee/Shiawassee Michigan Works CEO Craig Coney asking for the funds.
Flint Journal records show Loving was placed on unpaid administrative leave from her position at Career Alliance in 2007 and never returned. She won a $154,000 judgment in 2008 against Career Alliance because she claimed her contract had been effectively terminated.
Goldsmith said he would not allow the restitution because he did not believe the judgment was attributed to her criminal conduct.
Helen Williams, a former Flint school board member and Loving's cousin, was sentenced to pay more than $240,000 in restitution and placed on two years of probation, while QB Pittman, Career Alliance's former chief financial officer, was sentenced Oct. 24 to one year probation and ordered to pay more than $91,000 in restitution after Williams and Pittman pleaded guilty in the case.
Williams served as executive director of Flint Family Road, an organization started with the goal of reducing infant deaths by better preparing parents to be mothers and fathers, according to Flint Journal files.
She admitted in court to falsifying invoices to get money from Career Alliance contractors for services she never provided. Williams admitted in court to embezzling more than $88,000.
Pittman admitted to knowingly authorizing the fraudulent expenses. He was convicted of a misdemeanor and was sentenced by a magistrate judge.
His attorney, Trachelle Young, said she felt his sentence was fair and noted that he was convicted of a misdemeanor and not a felony. She added that he did not benefit financially from the embezzlement.
Williams' attorney, Kenneth Scott, could not be reached for comment.
The U.S. Attorney's office, which prosecuted the cases, agreed not to object to probationary sentences being handed down to Williams and Loving despite federal sentencing guidelines calling for 10-16 months in prison. Officials with the U.S. Attorney's office could not be reached for comment.
The convictions of Loving, Williams and Pittman came more than three years after Flint police Chief David Dicks was sentenced to six months of home confinement after he was accused to taking nearly $47,000 from a security company while he was serving as a police officer or was taking classes at Mott Community College. Dicks' plea agreement included a sentencing guideline of 6-12 months.
Dicks' father, Richard Dicks, ran the security company that contracted its services to Career Alliance. Federal charges against Richard Dicks were dismissed after he entered a federal diversion program where he agreed to stay out of trouble for 18 months.
Charles Palmer, a professor at Lansing-based Cooley Law School and former criminal defense attorney, said he wasn't surprised to see that prison time wasn't handed down in any of the cases.
Palmer said that the people charged in the case were non-violent and had no prior felony criminal histories.
During Loving's sentencing hearing, Goldsmith said that the crime Loving committed was serious and that the law she broke needed to be "respected and vindicated."
Palmer said he feels the judge's sentence accomplished that goal.
"What's happened to these people is quite a deterrent," Palmer said. "Don't minimize what happened to these people."
Palmer said these types of sentences have a big impact when defendants have professional careers. He said the convictions will prevent them from holding many jobs, particularly those that involve public trust or handling money.
Flint attorney Frank J. Manley, who represented David Dicks, said the conviction has changed his client's life. Manley said Dicks moved out of state and went back to college in order to start a new career.
"Certainly it had an impact on David's career," Manley said. "He's a prisoner of his actions for the rest of his life."
The investigation could also bring changes to how the county manages the Michigan Works agency.
Curtis, who is the chief elected official on the multi-jurisdictional board overseeing the agency, said he wants the county to explore implementing its own career services programs rather than relying on Michigan Works.
Currently, Curtis said Genesee County taxpayers could be on the hook to pay restitution to the state or federal authorities if there is misspending since the county serves as the fiduciary for the agency.
However, the state agency that oversees the Michigan Works program said the state has precautions in place to catch and prevent fraud.
Mike Wurmlinger, director of the state Office of Audit and Financial Compliance for the Workforce Development Agency, said the state has 25 local workforce development boards that are reviewed annually. There is also on-site monitoring at the Michigan Works offices.
Any possible illegal expenditure is reported to the federal Office of the Inspector General, according to Wurmlinger.
"It was the processes utilized by the Workforce Development Agency that uncovered the situation at Career Alliance," said Christine Quinn, Michigan Workforce Development Agency director. "WDA notified the appropriate federal authorities, who then initiated an investigation and subsequent prosecution of the responsible parties. WDA continues to conduct reviews at all Michigan Works agencies across the state to ensure funding is spent and programs are administered in accordance with state and federal regulations."
Representatives of state Senator Jim Ananich, D-Flint, said state lawmakers should remain diligent in preventing this type of fraud in the future.
"Senator Ananich is committed to protecting every dime of taxpayers' hard earned dollars from fraud, waste, or abuse," said Ananich's spokesperson Tom Lenard. "If there are ways for more oversight and accountability on the front end of the process to make sure these funds are going where they are supposed to, the Legislature should find bipartisan measures and enact them. Job creation is so critical to addressing the many challenges we face that we can't afford to lose any tools to help people get the skills they need to secure good-paying jobs."
Craig Coney, the current president and CEO of Genesee/Shiawassee Michigan Works, and attorney Peter Goodstein, who represents the local Michigan Works office, could not be reached for comment. |
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Sun Dec 08, 2013 12:53 pm |
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untanglingwebs
El Supremo
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"Currently, Curtis said Genesee County taxpayers could be on the hook to pay restitution to the state or federal authorities if there is misspending since the county serves as the fiduciary for the agency.
However, the state agency that oversees the Michigan Works program said the state has precautions in place to catch and prevent fraud.
Mike Wurmlinger, director of the state Office of Audit and Financial Compliance for the Workforce Development Agency, said the state has 25 local workforce development boards that are reviewed annually. There is also on-site monitoring at the Michigan Works offices.
Any possible illegal expenditure is reported to the federal Office of the Inspector General, according to Wurmlinger.
"It was the processes utilized by the Workforce Development Agency that uncovered the situation at Career Alliance," said Christine Quinn, Michigan Workforce Development Agency director. "WDA notified the appropriate federal authorities, who then initiated an investigation and subsequent prosecution of the responsible parties. WDA continues to conduct reviews at all Michigan Works agencies across the state to ensure funding is spent and programs are administered in accordance with state and federal regulations."
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The state and federal authorities can make all the claims they want, but this fraud went on for years. Don't forget there were earlier claims of conflict-of-interest and other issues with Career Alliance. And before Career Alliance was Jobs Central with the problems associated with Greg Eason.
If local police agencies, like the Sheriff Department seizing the records, had not put forth an effort would the other agencies have even caught on. I have seen first hand how the state and federal government cover up and misrepresent fraud to protect themselves. Since the state had oversight, why aren't they on the hook to pay back the losses of federal money instead of the county?
Good Job Gary Ridley! Very though article. |
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Sun Dec 08, 2013 1:03 pm |
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untanglingwebs
El Supremo
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Editorial: Sentence in federal Career Alliance embezzlement case sends wrong message
MLive/Flint Journal opinion By MLive/Flint Journal opinion
on December 08, 2013 at 9:00 AM, updated December 08, 2013 at 9:09 AM
Two women have pleaded guilty to federal charges for embezzling money from Career Alliance.
The following is an opinion of The Flint Journal Editorial Board.
GENESEE COUNTY -- Being chief executive officer of a public agency comes with an enormous amount of responsibility, and taxpayers expect their public servants will be held to a high standard of accountability.
So when the public’s trust is violated, as is the case with Pamela Loving, the former CEO of Career Alliance who was convicted of embezzling from the career service organization, the public expects a suitable punishment.
We can’t help but feel like the legal system missed the mark on this one.
Loving was spared a prison sentence Tuesday though sentencing guidelines called for 10 to 16 months. Instead, a judge ordered her to pay more than $586,000 in restitution and serve five years of probation, including one year of house arrest.
Loving doesn't even have to do community service, which at least would have been a way to start to pay her debt to society. Her attorney says she will pay the money back – even though she has filed for bankruptcy – and we hope she does. Of course she should pay back the money that was misappropriated.
U.S. District Judge Mark A. Goldsmith said his sentence sends a strong signal that this type of crime will not be tolerated by the court.
We respectfully disagree.
Loving was at the center of an investigation that revealed chronic mismanagement and improper spending at Career Alliance, which is now known as Genesee/Shiawassee Michigan Works. She admitted to taking about $78,000 for her personal benefit and to pay to train others not at Career Alliance, and is alleged to have misappropriated $700,000 in funds during her 11-year tenure. The judge said “there was a significant amount of funding that ended up benefiting (Loving) either in a monetary way or a non-monetary way.”
What is the justification for dismissing the sentencing guidelines with this case?
Her light sentence gives the appearance that she’s getting preferential treatment, especially in light of her attorney’s argument earlier this month that she should be spared prison time because she’s an iconic figure in the Flint community.
The attorney’s argument is backwards.
Loving was the head of an agency responsible for millions of dollars for employment programs in the Flint area.
This sentence perpetuates the belief that people in high social circles who commit crimes can get off with little to no punishment, and sends the wrong message to the taxpayers and public to which Loving was accountable. |
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Sun Dec 08, 2013 1:27 pm |
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untanglingwebs
El Supremo
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I and many readers agree with this editorial.
Readers pointed out that in most cases restitution is never made. Flint is still paying off the 108 loans to OK Industries (Giacalone and Robin) as well as the Manhattan Place. To the best of my knowledge, no restitution has been made and Leighton dropped the criminal charges in the OK Industries case.With bankruptcy for Loving already in place, how will restitution take place?
Commenter Mauserbowser admitted he was taking the race card when he pointed out how he believed blacks were held to a more lenient sentencing for similar crimes than whites. He pointed out that Ale Dandy and Burton administrator Charles "Skeeter' Abbey both served prison times. However, his later arguments appeared to be more class related than race related as he noted unknown blacks and whites get prison while people of positions among the powerful and wealthy "get a free ride"
Jack Minore made a good observation when he noted "Most of these people are old enough that a "career interruption is not a punishment". He too acknowledged "the sentencing does demonstrate the unfairness and inequity of the justice system".
St.Mike's66 stated he was "very upset at the travesty of justice" and he believed the outcomes were wrong for these individuals that "used taxpayers for their own personal, greedy gains"
Blunt as always, activist Barrington Robinson denounced loving and Williams for "stealing while they were supposedly representing the people". He too believed Loving and Williams deserved jail time. |
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Sun Dec 08, 2013 1:45 pm |
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