Lansing — Attorney General Dana Nessel’s office has charged Metro Detroit businesswoman Fay Beydoun with 16 offenses tied to how she spent and documented expenses related to a $20 million state taxpayer-funded grant meant to create a business accelerator, according to court records.
The attorney general’s office, in an affidavit dated Monday, is seeking charges that include larceny by conversion, uttering and publishing, and conducting a criminal enterprise against Beydoun, a Democratic former appointee and fundraiser for Gov. Gretchen Whitmer. Conducting a criminal enterprise, which is a 20-year felony, carries the highest penalty of the charges issued.
At a press conference Wednesday in Lansing, Nessel alleged Beydoun used her political connections in the Legislature and executive branch to secure a so-called “glass slipper grant” to enrich herself in a scheme that entangled the Michigan Economic Development Corporation, Whitmer’s office and unnamed “political operatives.”
“It appears per our investigation that Ms. Beydoun never intended to pursue the lawful purpose of the grant and only sought to use these funds for her own personal enrichment,” Nessel said Wednesday.
The Democratic attorney general, who is leaving office at year’s end, indicated the investigation continues but said, so far, there is no evidence those involved with appropriating the grant knew how Beydoun intended to spend it.
“While it’s clear to us that Fay Beydoun used her political connections to get this grant, we don’t have evidence that people knew that she planned to misappropriate the money or to spend the money illegally. We don’t have evidence of that.”
The affidavit filed in support of the charges alleged Beydoun used taxpayer money to spend more than $3,000 for catering for events at her home involving former Mayor Mike Duggan, that she appears to have fraudulently altered a legal invoice, that she listed a vacant address for a rental cost and that she used grant funding for two handmade rugs from Tunisia totaling $6,148.
“Instead of using those funds for the legally-intended purpose of establishing an international business accelerator, Beydoun used them to pay for personal expenses, and then lied when reporting on how she used the funds,” Special Agent Kyle Kolka wrote in the affidavit.
Beydoun declined to comment when approached Wednesday morning by a Detroit News reporter outside of the Farmington Hills home. The charges were filed in 47th District Court in Farmington Hills. Beydoun was arraigned on Wednesday, according to court records.
“For the last six months, our firm has attempted to demonstrate the illogical nature of the allegations against Ms. Beydoun to the Michigan Department of Attorney General,” said attorney Vincent Haisha, a partner at Flood Law, which is representing Beydoun. “Despite those efforts, it is evident that certain parties felt the need to further this very public spectacle in a way that is neither supported by the evidence that we have seen nor the investigative materials we possess. As always, we will save our best arguments for the courtroom and pursue every avenue available for our client.”
Beydoun’s charges include conducting a criminal enterprise, forgery, seven counts of uttering and publishing, six counts of larceny of $1,000 to $20,000 and larceny of more than $20,000. The latter charge is punishable by up to 10 years in prison.
The affidavit indicates the investigation into Beydoun’s expenses is ongoing, “and further charges are possible.”
“We will continue to interview witnesses and may identify other potential defendants,” Nessel said at the press conference. “… It is possible Ms. Beydoun may face further charges.”
Affidavit alleges forgery, fraudulent expenses using taxpayer cash
Of the $1.35 million spent and documented in reports to the MEDC, less than $20,000 could be attributed to business accelerator purposes spelled out in the statutory language awarding the grant, according to a review by a financial specialist in Nessel’s office.
The affidavit lists several expenses as allegedly fraudulent, including an $11,325 legal invoice that investigators said appeared to be forged. The attorney to whom the invoice is attributed told investigators it is “not legitimate.” He said he reviewed Beydoun’s employment contract and litigated an insurance dispute for Beydoun’s son, but did no work for Global Link International. The logo on the invoice appeared to be “photoshopped,” the attorney told investigators.
A second alleged fraudulent expense in the affidavit included a $40,800 check to Salhab Enterprises for “fully furnished 2 units.” The address connected to the expense led to a vacant lot, the affidavit said.
Fadi Salhab told investigators he recognized the wrong addresses had been used on the documents and was unsure whether Beydoun actually ever used his units. He said the only person he knew who stayed at the property was Beydoun’s son, according to the affidavit.
A third fraudulent expense listed in the affidavit involved a $6,148 expense submitted to the MEDC as an “investor dinner” during a trip to Tunisia. The invoice related to the expense, the affidavit said, does not refer to an event expense, but refers in French to “two handmade rugs” from an artisanal company that makes textiles.
“The MEDC never had this receipt (translated), but my investigators did. … It was in French,” Nessel said.
The expense, dated Aug. 18, 2023, was followed by an email the next day to Beydoun’s son that said, “Would you like an authentic rug from Tunis handmade Great quality,” according to the affidavit.
A fourth fraudulent expense outlined in the affidavit includes two checks in June and August 2023 for $1,870 and $1,535, respectively. Beydoun described the expenses in her report to the MEDC as catering expenses. Investigators found the checks corresponded to meetings Beydoun held at her home for former Detroit Mayor Mike Duggan, and the caterer listed in the checks said the only events he catered “were at Beydoun’s home for Mike Duggan.”
Duggan, a longtime Wayne County Democrat, is now running for governor as an independent. In a statement on Wednesday, the former three-term Detroit mayor’s gubernatorial campaign said Duggan attended two small dinners as a guest of Beydoun as part of more than 100 meetings at homes and community centers across Michigan in 2023.
“No money was raised and the mayor had no further events with her,” said Andrea Bitely, a spokeswoman for Duggan’s campaign. “The mayor had no knowledge MEDC funds were used for the dinners. He accepted a host’s invitation to small meet-and-greets. Nothing more.”
A fifth allegedly fraudulent expense listed in the file included $5,557 spent at Royce Lighting in Redford while Global Link was still “months away from having even a temporary office location.” None of the items purchased — a nesting table, “orchid plus frame,” end table, vases, artificial flowers — were “useful for creating or operating GLI,” the affidavit said.
A sixth expense flagged by investigators involved $1,483 spent at Great Lakes Ace Hardware in Farmington Hills. The receipt included no items relevant to Global Link, the affidavit said. Instead, the receipt included patio and gardening accessories, a bird feeder, a fire pit, glue, cleaning solutions, and bags and boxes, the document said.
During a June 18 raid of Beydoun’s Farmington Hills home, investigators found the fire pit bought with taxpayer funds in her backyard, according to Kolka’s affidavit.
The affidavit also alleged that progress reports submitted to the MEDC by Beydoun after The News reported on Global Link’s expenses were meant to mislead and delay the agency. The reports, the affidavit said, were “materially false” in claiming progress had been made at Global Link.
Lisa Katz, a former employee of Global Link and later a whistleblower, told law enforcement that statements submitted by Beydoun included incorrect information implying Global Link had a focus on any one region or that it had any relationships with international agencies, the affidavit said. The reported “progress” in the reports, Katz said, was “imaginary.”
“The evidence establishes Beydoun was lying to MEDC about progress to keep the grant money flowing — especially Beydoun’s $550,000 annual salary — and forestall any further action by MEDC,” the affidavit said.
Detroit News investigation sparked probe into Beydoun’s grant
The $20 million grant in question has been a subject of controversy for the past three years after The Detroit News reported the nonprofit receiving the grant was not officially registered with the state until after budget passage and that Beydoun had reported expenses to the state that included a $4,500 coffeemaker, an $11,000 first-class ticket to Budapest and other expenses.
Kolka’s affidavit said the Attorney General office’s probe of Beydoun and Global Link was sparked by The News’ investigation of how the money was being spent.
The then Republican-led Legislature and Whitmer in 2022 included the $20 million grant in a batch of about $1 billion in earmarks contained in the annual budget for fiscal year 2022-23.
The grant, which is listed as being sponsored by then-House Speaker Jason Wentworth, a Republican, was supposed to create a business accelerator named Global Link International. Global Link was not officially registered with the state as a nonprofit until after the passage of the budget.
Wentworth has denied sponsoring the grant, though he acknowledged he had been approached by Beydoun earlier in the year about funding the international business accelerator program.
At the time, Beydoun was working as the executive director of the American Arab Chamber of Commerce and was a Whitmer appointee on the governing board of the Michigan Economic Development Corporation, which was tasked by the Legislature with administering the Global Link grant.
“Beydoun was thus a decision-making MEDC board member at the same time as she was seeking a specific appropriation that the MEDC would administer if the Legislature passed the appropriation,” Kolka wrote in his affidavit.
The American Arab Chamber of Commerce has said it tasked Beydoun with seeking the grant for the chamber’s own business accelerator and that she used the chamber’s name, email address and staff to communicate with state officials about it. Instead of going to the chamber, the grant was awarded to a yet-to-be-formed nonprofit registered to Beydoun’s home address.
eleblanc@detroitnews.com
cmauger@detroitnews.com
Staff Writer Max Bryan contributed.
This article originally appeared on The Detroit News: Fay Beydoun hit with 16 criminal charges in $20M earmark scandal
Reporting by Beth LeBlanc and Craig Mauger, The Detroit News / The Detroit News
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