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Feds: Fake hospice laundered cash in FCA-UAW scandal

Robert Snell
The Detroit News

Detroit — Federal prosecutors have seized $292,000 from a fake hospice that funneled cash to Monica Morgan-Holiefield, a central figure of the Fiat Chrysler-UAW corruption scandal, court records allege.

A federal court filing Tuesday seeking forfeiture of the money deepens a $4.5 million scandal involving two pillars of the auto industry and illustrates how federal agents are following money raided from a training fund for blue-collar workers.

The filing emerged eight weeks after a federal grand jury indicted former Fiat Chrysler executive Alphons Iacobelli and Morgan-Holiefield, widow of former UAW Vice President General Holiefield. The auto executive and the widow are accused of conspiring in a scheme that drained more than $4.5 million from the training center over several years.

In the filing, federal prosecutors chart the winding path of money from Fiat Chrysler’s bank account to Morgan-Holiefield’s pocket — after being transferred through her husband’s nonprofit and an acquaintance’s sham hospice in Detroit.

Morgan-Holiefield’s lawyer declined comment Tuesday.

The money laundering described by federal prosecutors dates to 2009.

Between July 2009 and June 2013, Fiat Chrysler transferred $386,400 to the UAW-Chrysler National Training Center, a tax-exempt corporation established to train and educate workers.

The training center transferred the money to the nonprofit Leave the Light on Foundation, a tax-exempt group controlled by General Holiefield, prosecutors allege.

Holiefield had solicited donations “to help children who are struggling with hardships,” according to the filing.

The foundation’s treasurer was Jerome Durden, 61, of Rochester Hills, who struck a plea deal last month and is expected to cooperate with federal prosecutors.

Prosecutors say most of the foundation’s operating funds were paid to Morgan-Holiefield.

Months after the Leave the Light on Foundation received the $386,400, a little-known hospice in Detroit had a nearly barren bank account.

On May 11, 2014, Hospice of Metropolitan Detroit had $425 in the bank.

The next day, the hospice’s fortunes changed.

On May 12, 2014, a $325,000 check from the Leave the Light on Foundation was deposited into the hospice’s bank account, prosecutors said.

Prosecutors say the hospice was controlled by Morgan-Holiefield’s acquaintance, Mary Elon-Eloni Wilks, 84, a former assistant superintendent of Detroit Public Schools, according to her LinkedIn page.

In 2014, the same year the hospice received $325,000 from Holiefield’s foundation, he was diagnosed with pancreatic cancer. Holiefield would soon need hospice treatment.

The hospice had a second bank account at Liberty Bank and Trust. That account received a $6,000 donation from the UAW training center in June 2012, prosecutors said.

In October 2014, five months after the hospice received $325,000 from General Holiefield’s nonprofit, Wilks registered a second foundation with the state.

The foundation is not identified in the federal court filing. But state business records indicate that in October 2014, Wilks registered the Thomas Andrew and Kathryn Mosely Dorsey Foundation. The foundation’s address is the same as the hospice and lists “Monica Morgan” as an incorporator.

The foundation was established to educate the public about gospel and other types of music, according to the state filing.

Wilks could not be reached for comment Tuesday.

By October 2014, Wilks had asked to open a new account at Liberty Bank and Trust. The new account was linked to Hospice of Metropolitan Detroit and called the “Leave the Light on Fund,” prosecutors said.

In early March 2015, Holiefield’s cancer worsened and he entered hospice care.

He wasn’t sent to Hospice of Metropolitan Detroit.

That’s because the hospice wasn’t real, prosecutors allege.

Investigators questioned hospice board member Tesfaye Kebede. He resigned in 2016 and said the group never provided any hospice-related services, according to prosecutors.

“Kebede stated that he attended infrequent board meetings and that his involvement was limited because (Hospice of Metropolitan Detroit) was not performing any work,” Assistant U.S. Attorney Adriana Dydell wrote in the court filing Tuesday.

Holiefield died March 9, 2015. Five months later, money started leaving the hospice’s bank accounts.

On Aug. 26, 2015, Wilks received $62,000, prosecutors allege.

The check purportedly bore signatures of hospice board members, including Kebede, prosecutors said.

Kebede told investigators he was unaware that the hospice had received $325,000 from Holiefield’s nonprofit Leave the Light on Foundation, prosecutors said. He also was unaware that the hospice had issued a $62,000 check to Wilks.

Kebede also said he did not sign the $62,000 check “and never gave permission for anyone to sign on his behalf,” prosecutors wrote.

Prosecutors seized $62,000 from Wilks’ bank account in February, along with $230,000 from a hospice bank account.

Wilks wasn’t the only one to receive money after the Leave the Light on Foundation gave $325,000 to the hospice.

“Wilks further acknowledged making transfers of up to $1,500 to Monica Morgan in the months after (Hospice of Metropolitan Detroit) received $325,000 ...” the prosecutor wrote Tuesday.

In the criminal case, prosecutors allege money raided from the training center was spent on luxury items, including a $350,000 Ferrari, a swimming pool at Iacobelli’s house, $37,500 gold pens, $1,000 Christian Louboutin shoes and a $2,180 shotgun for UAW Vice President Norwood Jewell.

Fiat Chrysler CEO Sergio Marchionne said the scandal had “nothing whatsoever to do with the collective bargaining process” during UAW negotiations. UAW President Dennis Williams also previously released a letter to union members denying the allegations involving FCA officials and union negotiators had any impact on bargaining.

The criminal case, however, alleges several people conspired to violate a federal labor law designed to combat corruption of the collective bargaining process.

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