Demolition man gets year in prison in housing scandal
Detroit — A Metro Detroit businessman who received more than $372,000 in bribes while rigging bids to demolish homes in the city as part of a scandal-plagued federal program was sentenced to one year in federal prison Tuesday.
Anthony DaGuanno, 62, of New Baltimore, a former estimator for Adamo Group, is the first person sentenced in a long-running investigation of Detroit Mayor Mike Duggan's program to rehabilitate the post-bankrupt city.
DaGuanno is one of two former Adamo employees charged in federal court and accused of a pattern of corruption involving contractors and dozens of secret payoffs. The corruption undermined the integrity of an unprecedented plan to remove thousands of dangerous, blighted structures in a city decimated by the Great Recession, prosecutors said.
Prosecutors wanted U.S. District Judge Victoria Roberts to sentence DaGuanno to up to 30 months in prison, calling him a greedy liar.
"His actions were driven purely by greed, and he could have stopped accepting bribes at any point," prosecutors wrote. "Instead, it took a federal investigation to uncover his criminal behavior."
DaGuanno violated his employer's trust but should receive probation, his lawyer Richard Helfrick wrote in a separate filing.
"... no financial loss was suffered by the city of Detroit or his employer," Helfrick wrote. "Mr. Daguanno’s conduct resulted in savings to the City of Detroit. Mr. Daguanno’s conduct resulted in savings to his employer."
DaGuanno, who has agreed to repay more than $372,000, apologized for his actions.
"I want to say how very sorry I am. I am truly remorseful," he told the judge. "What I did was wrong and I understand that."
The judge lamented the string of public corruption convictions in Metro Detroit in recent years.
"This is another one in a long line of cases in this city involving contracts and public funds," Roberts said. "It is a serious offense."
The city has received more than $265 million in mostly federal funds in the past six years and removed 12,384 structures under the federal program but questions about whether the money was misspent have clouded Duggan's two terms in office.
DaGuanno and Aradondo Haskins, 48, of Detroit, a former Adamo Group estimator who later worked for the Detroit Building Authority until 2016, were charged in April and struck plea deals with the government. Haskins is scheduled to be sentenced Sept. 23.
Prosecutors described a conspiracy that started in January 2010 — before the start of the federal demolition program and Duggan's first term — and continued until January 2019.
DaGuanno received bribes from an unidentified contractor on 71 occasions starting in January 2010. The payments were made without the knowledge of Adamo or city officials, according to the court filing.
"It is also worth noting that the government gave DaGuanno an opportunity to admit his criminal acts, but he failed to do so," prosecutors wrote.
The accusation is misleading, DaGuanno's lawyer said.
DaGuanno was accompanied to the first government meeting by an Adamo lawyer and was reluctant to admit wrongdoing in front of the attorney, Helfrick told the judge.
Haskins identified the bribe payer as Rich Berg, an executive with the Detroit firm Environmental Specialty Services, who has not been charged with wrongdoing.
In 2015, the company was awarded $545,000 in federally funded work from the Detroit Land Bank for asbestos abatement involving 55 properties, according to the land bank.
That does not account for federal dollars the company may have received as a subcontractor under the program.
After DaGuanno and Haskins pleaded guilty April 9, prosecutors took the unusual step of announcing they did not expect to bring any more charges "as of today’s date" against public officials for wrongdoing in Detroit’s federally funded demolition program.
“Mr. DaGuanno was an employee of a private demo company who rigged bids to the detriment of his own company," Duggan spokesman John Roach said in an email. "This was all done without the knowledge of city officials and bears no reflection on the administration of the demolition program. We are glad that the individuals involved have been convicted and that the US Attorney issued a statement the he expects there to be no future charges against any public officials.”
The city's program, a centerpiece of the Duggan administration, came under scrutiny in fall 2015 amid concerns over bidding practices and spiraling costs. It's since been under the scrutiny of state and local probes as well as a federal grand jury.
The program was suspended by the U.S. Treasury Department in the summer of 2016 to address concerns involving paperwork, billing and misallocation of funds. It was reinstated two months later.
Duggan has defended the "vigorous" practices of the city's program after concerns also were raised over whether some of the dirt used to fill holes following demolitions might have been contaminated.