Feds want demolition subpoena to remain secret

Christine Ferretti
The Detroit News

Detroit — A federal inspector conducting a criminal investigation of the city’s demolition program is asking a court to keep secret the contents of a subpoena sent to the Detroit Land Bank Authority, saying its release will compromise the probe.

In a Wayne County Circuit Court declaration filed Wednesday, Christy Goldsmith Romero, with the Office of the Special Inspector General for the Troubled Asset Relief Program, or SIGTARP, confirmed the agency issued an administrative subpoena to the Detroit Land Bank Authority on May 9 “in the furtherance of a criminal investigation.”

Romero said disclosure “would interfere with the SIGTARP investigation” and “further identifies those individuals and entities who would be providing information to the federal government in a criminal investigation.”

A government watchdog group filed a Freedom of Information Act request in June to obtain copies of subpoenas received by the land bank authority, its attorneys, contractors and others from the FBI, SIGTARP or other federal departments “regarding any demolition contract or program.”

Wayne Circuit Judge David Allen is expected to hear a motion Friday from the plaintiff, A Felon’s Crusade for Equality, Honesty and Truth. The nonprofit was established in June and is headed by activist and convicted felon Robert Davis, who is seeking to compel disclosure of the subpoena.

The land bank denied Davis’ information request, citing law enforcement and personal privacy exemptions in the state’s FOIA rules. Releasing the documents, attorneys for the land bank said in court records, would interfere with the SIGTARP investigation and “constitute an unwarranted invasion of privacy for the third party individuals who are identified in the subpoena.”

Andrew Paterson, Davis’ attorney in the matter, said Thursday that a subpoena is a public document.

“I’d like the public to be able to see,” he told The Detroit News. “They are entitled to it.”

Craig Fahle, a spokesman for the land bank, said Thursday the authority won’t comment on an ongoing investigation.

The United States is not a party to the court case, but wrote it has a direct interest in preventing interference with its ongoing investigation.

Romero cautioned in the court filing that releasing the subpoena would interfere with the SIGTARP investigation by “revealing the focus, including the evidence sought and/or transactions being investigated and scope of the investigation.”

“Disclosing the scope and focus of the investigation would jeopardize ongoing law enforcement efforts by alerting current and potential persons and entities, including those named in the subpoena and potential subjects not listed in the subpoena who would be notified upon publication of the investigation’s scope and focus, that they are or could become the subject of the federal investigation and for what specific conduct,” she wrote.

“Such knowledge would allow the targets of the investigation to destroy evidence, fail to maintain potential future records of the type requested in the subpoena, threaten potential witnesses, or take other actions to avoid detection and circumvent SIGTARP’s investigation.”

If the subpoena request is granted, Romero said, it could harm SIGTARP investigators named in the subpoena as well as the agency’s ability to conduct similar reviews in other states that maintain Hardest Hit Fund programs.

Paterson said Thursday the names of the investigators can be redacted, “but everything else ought to be public.”

The dispute over the subpoena is set to go before a judge weeks after the resignation of Detroit Building Authority’s deputy director, Jim Wright, who oversaw the city’s massive blight-removal program.

Detroit’s auditor general confirmed in April that his office had received a subpoena from SIGTARP after it released preliminary findings from a months-long audit into the city’s demolition activities. The report flagged potential conflicts of interest between the city and executive leadership of the city’s building authority.

Tyrone Clifton took over in May as head of the building authority. His appointment came shortly after the April report that criticized David Manardo, then-director of the Detroit Building Authority, who also holds office as Detroit’s group executive for operations.

Last month, one of the city’s largest demolition contractors, Detroit-based Adamo Group, confirmed it received and fully complied with a subpoena seeking documents related to its contract with the Land Bank Authority for the federal Hardest Hit Blight Elimination Program.

The Duggan administration’s demolition program came under scrutiny last fall amid concerns over soaring costs and bidding practices. In May, the FBI’s Detroit office acknowledged it is investigating the program. The city’s Office of Inspector General is also conducting a review of an aspect of the program.

Detroit officials have defended the demolition program that’s brought down more than 10,000 blighted homes since 2014 and said they are cooperating fully with all investigations.