Kilpatrick's frat brother took gifts
Kwame Kilpatrick's fraternity brother provided a peek inside a jet-setting lifestyle bankrolled by Detroit pension fund businessmen Wednesday, but insisted he did not betray the trust of police widows, firefighters and other retirees who relied on him for retirement benefits.
The fraternity brother, former Detroit Treasurer Jeffrey Beasley, testified in his own defense in federal court during the highest-profile public corruption trial since Kilpatrick was convicted and sentenced to 28 years in prison last year.
The nearly four hours of testimony, including a tense government cross-examination, provided Beasley's first public comments since he was indicted almost three years ago.
From 2006-08, he is accused of pocketing bribes and kickbacks in return for approving more than $200 million in pension fund investments. The city's two pension funds lost more than $84 million on the deals, prosecutors allege.
Beasley told jurors Wednesday he ate, drank, golfed, gambled, vacationed, rode in private jets and Las Vegas limousines — all paid for by people who had business pending in front of Detroit's two pension funds. Beasley sat on the boards of both pension funds and helped decide how to invest the retirement system's $6 billion in assets.
At one point, Beasley testified about coming home and finding a Christmas gift from Chauncey Mayfield, a businessman who oversaw $200 million worth of pension fund investments.
"Was it from Tiffany?" Beasley's lawyer, Walter Piszczatowski, asked.
"It was a blue box," said Beasley, 45. "I guess."
"Did that somehow cause you to give him favorable treatment?" his lawyer asked.
"Chauncey was a classy guy. First class," Beasley said. "This didn't have anything to do with a vote. He was very professional and had a lot of class. I took it as that. Some people gave nice bottles of champagne — Moet. We got steaks sent to our house. This was his way of sending Christmas gifts."
The gifts kept coming.
From Mayfield, who gave Beasley's girlfriend a $45,000 job. From Greektown mogul Jim Papas, who gave Beasley gambling money, free drinks and meals. From a Georgia businessman who spent $8,000 on a 3,000-square-foot, four-bedroom villa in the Caribbean for Beasley, his wife and five kids.
"It was bigger than your house in Detroit," Assistant U.S. Attorney David Gardey told Beasley.
Beasley will continue testifying Thursday morning in federal court.
Beasley started receiving gifts not long after Kilpatrick recruited his fraternity brother from Florida A&M University in 2005.
One year into his term as treasurer, in January 2007, Beasley ran into one of Kilpatrick's security guards. The guard was headed to the Atheneum Suite Hotel in Greektown and asked Beasley to join him.
The two went up to a private suite and opened the door.
"Surprise!" about 60 people yelled.
Most of the people were entrepreneurs, lawyers, money managers and others who had business deals in front of the pension funds.
"Wow," Beasley said he thought. "It was a good feeling."
Before the party ended, Detroit pension fund lawyer Ronald Zajac handed him a birthday card and an envelope filled with $100 bills.
"Tell us how much was inside," Piszczatowski said.
"Nine thousand dollars," Beasley said. "That's what I used to take my family on vacation."
Beasley testified he did not know who contributed toward the birthday gift nor made any assumptions despite being given the money at a party filled with pension fund businessmen.
Prosecutors allege Zajac organized the party and solicited the cash. Months later, Beasley and the pension boards gave Zajac a 33 percent pay raise — boosting his pay to more than $400,000 a year.
Zajac is standing trial alongside Beasley and former pension trustee Paul Stewart. If convicted, the men face up to 20 years in federal prison.
In April 2007, three months after the birthday party, prosecutors allege Mayfield flew Beasley, Kilpatrick and three others on a private jet to Las Vegas for a golf trip.
The flight cost Mayfield $43,000. The businessman also spent about $23,000 for the group to stay at the Venetian luxury hotel casino, eat and go to Prince and Toni Braxton concerts.
"And Mr. Mayfield paid for golf and you rode in a stretch Hummer," Gardey told Beasley.
"It was a stretch limo," Beasley corrected.
"You accepted all these things?" the prosecutor asked.
"Yes," Beasley said.
"Did you ever sell your vote as the result of getting your hotel paid for?" Beasley's lawyer asked.
"Never," Beasley said.
"Did you give Mr. Mayfield favorable treatment?" Piszczatowski asked.
"Never," Beasley said.
There was one thing Mayfield didn't pay for: a plane ticket for Beasley's girlfriend to join him in Las Vegas.
"She brought herself," Beasley said.
In August 2007, four months after Las Vegas, Beasley was back on an airplane for a family vacation at a luxury hotel in the Turks and Caicos.
Another Detroit pension fund businessman, Roy Dixon, was there, coincidentally. Dixon took Beasley golfing, gave him gambling money and showed him around the islands.
Beasley testified that he felt Dixon was trying to pitch a real estate proposal and the amount of time the men spent together caused friction with Beasley's family.
"What happened when you went to pay for your room?" Beasley's lawyer asked.
Dixon picked up the bill, Beasley testified.
"I offered to pay," Beasley said.
Dixon insisted on picking up the tab since he intruded on Beasley's family vacation, Beasley said.
Prosecutors said the hotel and other perks were bribes and kickbacks in exchange for Beasley supporting deals Dixon was pursuing with the pension funds.
One of Dixon's deals tanked and cost the pension funds $20 million. Prosecutors say Dixon embezzled more than $3 million and spent some of the cash on an $8.5 million mansion in Atlanta.
Dixon pleaded guilty last month, testified during the trial and could get more than eight years in federal prison. Mayfield also pleaded guilty and could be sentenced to more than four years in prison.
Beasley told jurors Wednesday he didn't keep all the gifts he received during his time in office.
A different pension fund businessman gave him an $1,800 Cartier watch in December 2007.
"I returned it," Beasley said.