Detroit — Federal prosecutors unveiled a criminal complaint on Wednesday against William Smith, the former chief financial officer of the Detroit Riverfront Conservancy, accusing him of embezzling nearly $40 million over several years. The funds were allegedly spent on airline tickets, luxury cars, jewelry, and more.
The charges against the 51-year-old Novi resident suggest that Smith began this scheme as early as November 2012, stealing funds from the nonprofit organization responsible for revitalizing Detroit’s riverfront. He faces serious charges of bank and wire fraud, each carrying a potential 20-year sentence.
The complaint details extravagant expenditures, including eight-figure credit card bills and unauthorized payments to a company controlled by Smith, called the Joseph Group. It also outlines a complex cover-up involving altered documents and a clandestine exchange of financial records in a Honey Baked Ham parking lot.
According to prosecutors, Smith misappropriated funds to cover personal charges made on an American Express account, diverting money without the Conservancy’s approval.
During a brief court hearing on Wednesday, Federal Magistrate Judge R. Steven Whalen released Smith on a $10,000 unsecured bond. Smith appeared in court in a white hooded tracksuit, black surgical mask, and shackles. He was seated next to another defendant, Jibreel Pratt, accused of terrorism linked to ISIS.
Assistant U.S. Attorney Robert A. Moran argued that Smith’s alleged long-term embezzlement raised concerns about him being a flight risk. Federal prosecutors sought to impose a strict curfew and require Smith to wear a GPS tracker. However, the magistrate deemed additional restrictions unnecessary due to Smith’s lack of prior criminal history.
Whalen set conditions for Smith’s release, including prohibiting him from entering any new financial transactions and requiring him to surrender his U.S. passport and firearms. During the hearing, Smith showed little emotion and was noted as unemployed, owning a restaurant and a rental property. A preliminary examination is scheduled for June 26.
Earlier that morning, the FBI conducted a raid at Smith’s home, with reports of loud bangs heard around 6 a.m. Witnesses noted a large moving truck and FBI agents removing boxes from the property.