Former Nonprofit Chief Financial Officer Charged With Embezzling Tens of Millions of Dollars

William A. Smith, 51, the former Chief Financial Officer for the Detroit Riverfront Conservancy, was charged with Bank Fraud and Wire Fraud in a criminal complaint unsealed in federal court, United States Attorney Dawn N. Ison announced.  The charges arose out of what is alleged to be a years-long scheme by Smith to embezzle Conservancy funds for his own use.

Ison was joined in the announcement by Cheyvoryea Gibson, Special Agent in Charge of the FBI’s Detroit Field Office.

According to court documents, The Detroit Riverfront Conservancy (DRFC, or the Conservancy) is a 501(c)(3) organization formed with the mission of developing access to the Detroit International Riverfront from the Ambassador Bridge to Belle Isle.  The DRFC is funded by a combination of public and private funds.  Smith was the CFO of the DRFC from 2011 until he was fired late last month.

According to the Complaint, beginning as early as November 2012, Smith orchestrated a scheme to embezzle millions of dollars in funds belonging to the DRFC.  The Complaint alleges that Smith carried out his embezzlement scheme in two distinct ways. First, Smith is alleged to have used Conservancy funds to pay for charges that he and his family accrued on an American Express account.  Second, Smith is alleged to have diverted Conservancy funds to a company he controlled called “The Joseph Group.” Neither of these sets of expenditures were authorized or approved by the Board of the DRFC; “The Joseph Group,” was not an approved vendor and provided no services to the DRFC, and Smith had no authority to use Conservancy funds to pay his own personal credit card bills. The complaint alleges that, between November 2012 and March 2024, Smith stole nearly $40 million from the DRFC through these two embezzlement streams.

To cover up his embezzlement, the Complaint alleges that Smith doctored bank statements provided to the Conservancy’s accountant for entry into the DRFC’s accounting software. These false bank statements led to erroneous financial information being entered into the DRFC’s books, thereby concealing the fraud. In 2023, Smith is alleged to have obtained a $5 million line of credit with Citizens Bank on the Conservancy’s behalf – a line of credit he was not in any way authorized to take out. The Bank asked Smith for documentation confirming that Smith, as CFO, had the sole authority to obtain such a line of credit on behalf of the Conservancy. Smith is alleged to have provided the bank with a document purporting to establish that Smith was indeed empowered by the DRFC Board of Directors to obtain such credit lines.  That document, according to the complaint, was false, and bore the forged signature of the Conservancy’s Corporation Secretary. Smith is alleged to have used funds he obtained from this line of credit to further his embezzlement scheme.

“The Detroit Riverfront Conservancy’s mission is to transform one of our city’s greatest assets, the riverfront, into a vibrant and safe space for all to gather and enjoy.  This defendant is alleged to have abused the trust the Conservancy placed in him and to have carried out a fraud that is simply astonishing in scale. Today’s allegations are extremely serious ones, and my office is committed to pursuing anyone, regardless of their title, who fleeces taxpayers and charitable donors for their own private gain.  We value our partnerships, and these charges are the result of the close cooperation and collaboration that we appreciate from our state and local law enforcement partners who brought this matter to our attention,” U.S. Attorney Ison said.

“This case was initially brought to us on May 14th, and we were able to quickly deduce that an enormous amount of money was allegedly embezzled, and that there would be mountains of documents to examine. It was something that we would be unable to handle properly at this time. We discovered an alleged Federal nexus and due to our various existing collaborations, my next call was to U.S. Attorney Dawn Ison. Fortunately for us, and the citizens of Wayne County and beyond, she agreed immediately to take this case,” said Wayne County Prosecutor Kym Worthy.

A criminal complaint is only a formal charging document and is not evidence of guilt.  A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.

The case is being prosecuted by Assistant U.S. Attorneys John K. Neal and Robert A. Moran.  The case is being investigated by the FBI.

Source: United States Attorney's Office Eastern District of Michigan

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