Michigan Attorney General Bill Schuette, Wayne County Prosecutor Kym Worthy, Michigan State Police Director Colonel Kriste Kibbey Etue and Detroit Police Department Chief James E. Craig announced they have expanded the Wayne County Sexual Assault Kit Task Force responsible for investigating and prosecuting leads resulting from the DNA testing of thousands of abandoned sexual assault kits discovered in a Detroit Police Department property storage facility in 2009.
“Our duty is to get rapists off our streets and deliver the justice victims are owed,” said Schuette. “The organizations working together on this task force have made this effort a priority and I am proud to be a part of it.”
- Schuette Charges Former U.P. Prison Employee with Felony
May 20, 2015
LANSING – Michigan Attorney General Bill Schuette today announced that his Criminal Division has filed a felony charge against a former Aramark supervisor employed at Kinross Correctional Facility for allegedly soliciting an inmate to help orchestrate the assault of another inmate. Schuette charged Michael R. Young, 27, of Kincheloe, with one count of Solicitation to Commit Assault with Intent to Cause Great Bodily Harm, a felony punishable by up to five years in prison. The case was jointly referred to the Department of Attorney General by the Chippewa County Prosecutor’s office and the Michigan State Police (MSP).
“If you try to take the law into your own hands to exact revenge, there will be consequences,” said Schuette. “Criminal charges in this case are the result of a thorough and exhaustive investigation. I want to thank the Michigan Department of Corrections, Michigan State Police and the Chippewa County Prosecutor’s office for their help and hard work on this case.”
Background on the Case
Young was employed by Aramark at Kinross Correctional Facility in Chippewa County. In 2014, a Kinross inmate allegedly reported to the Michigan Department of Corrections that he was solicited by Young to find an inmate to assault another inmate incarcerated at a different correctional facility. Young allegedly told the inmate that the target inmate was serving a sentence for the murder of one of Young’s relatives and provided the inmate with details like the name and prisoner number of the target inmate. It is alleged that Young offered tobacco products to the inmate in return for recruiting an inmate at the other facility to carry out the proposed assault. At the joint request of the Chippewa County Prosecutor’s office and MSP, Schuette’s Criminal Division conducted an extensive investigation into the allegations with collaboration from MSP and the Michigan Department of Corrections.
On May 19, 2015, Schuette’s Criminal Division filed the following criminal charge against Michael R. Young in Chippewa County’s 91st District Court in Sault Ste. Marie:
- One count of Solicitation to Commit Assault with Intent to Cause Great Bodily Harm, a felony punishable by up to five years in prison.
Young was apprehended by authorities in Kincheloe on May 19, 2015 and will be arraigned in Chippewa County’s 91st District Court in Sault Ste. Marie at 11 a.m. Young was assigned a $50,000 cash bond and is currently being held in the Chippewa County jail.
A criminal charge is merely an accusation and all defendants in this case are presumed innocent unless proven guilty.
- Schuette, Worthy, Etue, Craig Announce New Resources for Sexual Assault Evidence Kit Cases
May 19, 2015
LANSING – Michigan Attorney General Bill Schuette, Wayne County Prosecutor Kym Worthy, Michigan State Police Director Colonel Kriste Kibbey Etue and Detroit Police Department Chief James E. Craig today announced they have expanded the Wayne County Sexual Assault Kit Task Force responsible for investigating and prosecuting leads resulting from the DNA testing of thousands of abandoned sexual assault kits discovered in a Detroit Police Department property storage facility in 2009.
The Task Force, comprised of officials from the Department of Attorney General, Wayne County Prosecutor’s Office, Michigan State Police, Detroit Police Department, Michigan Domestic Violence Sexual Assault Prevention and Treatment Board, Wayne County SAFE, the YWCA and the Joyful Heart Foundation is funded by the participants and a one-time, $3 million state appropriation approved by the legislature last year. Following the development of a work and spending plan, the task force is expected to operate in this expanded capacity until September 30, 2017.
Today’s announcement is another step forward on the road to justice for victims whose sexual assault DNA evidence kits were never processed, allowing rapists to remain on the streets perpetrating more sexual assaults. Previously, in June 2013, Schuette and Worthy joined Governor Snyder to announce the use of $4 million in legal settlement funds obtained by the Department of Attorney General to fund the testing of thousands of evidence kits by the Michigan State Police. With today’s agreement, the task force will increase the rate at which leads produced by the testing will be investigated and prosecuted, prioritized by a focus on the worst offenders, the statute of limitations and the risk to public safety.
“Our duty is to get rapists off our streets and deliver the justice victims are owed,” said Schuette. “The organizations working together on this task force have made this effort a priority and I am proud to be a part of it.”
“It is nice to officially welcome the Department of the Attorney General to our longstanding collaborative,” said Worthy. “These additional resources will enable us to not only continue our work on the Detroit cases, but will enable us to follow through on DNA hits outside of Wayne County and the State of Michigan that we have not been able to focus on before. This, in conjunction with our Enough SAID Initiative is moving this project along.”
“The use of criminal analysts to support investigators in our Secure Cities detective bureaus has been a tremendous asset that has not only lessened the burden on investigators, but also increased the solvability of crimes,” said Etue. “We are pleased to be able to offer this valuable assistance to this long overdue effort to bring justice for these victims.”
“This is truly a collaborative effort and the Detroit Police Department is committed to working with the Attorney General, Wayne County Prosecutor and the Michigan State Police to bring closure to the victims of these heinous crimes,” said Craig. “I’m confident that, with all of these resources focused on solving these cases, we will be able to solve many of them and bring these criminals to justice.”
Each entity has assumed the following responsibilities and may seek to provide the following personnel for the task force, funded by the $3 million appropriation:
- Attorney General: Investigation and prosecution of cross-jurisdictional and out-of-state cold case sexual assaults, in conjunction with county prosecutors: Two full-time investigators and one Assistant Attorney General (prosecutor) on the task force.
- Wayne County Prosecutor: Prosecution of cases in Wayne County: Two prosecutors, one Crime Victim Advocate, one paralegal/statistician, one clerical assistant and one investigator on the task force.
- Michigan State Police: Analytics and data reports on sexual assault kits as they are tested, investigated and prosecuted, and assistance on investigations: Two Criminal Intelligence Analysts, one in Detroit and one in Lansing.
- Detroit Police: Six investigators, currently housed in the Wayne county Prosecutor’s Office, at no cost to the task force. The Detroit Police Department will investigate sexual assaults in the City of Detroit and cross-jurisdictional matters involving the City of Detroit.
Ongoing Efforts to Bring Justice for Victims, Strengthen Public Safety
In 2009, more than 11,000 untested sexual assault kits dating back more than 30 years were discovered in a Detroit Police Department property storage facility, each holding the potential to solve multiple crimes, including those committed by serial rapists. The MSP’s Forensic Science Division has been instrumental in the laboratory analysis of sexual assault kits by working with privately contracted laboratories, the Wayne County Prosecutor’s Office, and the Detroit Police Department, on efforts to test the remaining sexual assault kits. A majority of these kits have been tested and the remainder should be completed by this fall.
Michigan victims of sexual violence are encouraged to call the national sexual assault hotline toll-free, 1-800-656-HOPE. All calls are confidential, and will be answered by a local counseling center affiliated with the Rape, Abuse & Incest National Network (RAINN). Assistance is also available online at www.rainn.org.
- Schuette Joins Federal, Multi-State Crackdown on Four Cancer Charities Allegedly Bilking Over $187 Million from Consumers
May 19, 2015
LANSING – Michigan Attorney General Bill Schuette today joined state law enforcement partners in every state in the nation, the District of Columbia, and the Federal Trade Commission, to jointly file a federal lawsuit against four phony cancer charities and their operators, who allegedly scammed more than $187 million from consumers throughout the country.
The joint complaint alleges the defendants—including Cancer Fund of America, Children’s Cancer Fund of America, Cancer Support Services and The Breast Cancer Society—portrayed themselves to donors as legitimate charities with substantial nationwide programs.
“Federal and State law requires honesty of our charities and fundraisers. We will not tolerate those who employ unscrupulous fundraising tactics to deceive donors in Michigan and across the country,” said Schuette. “Our actions today mean that those charities aiming to deceive those who want to help children with cancer and breast cancer patients will be held accountable.”
“Cancer is a debilitating disease that impacts millions of Americans and their families every year. The defendants’ egregious scheme effectively deprived legitimate cancer charities and cancer patients of much-needed funds and support,” said Jessica Rich, Director of the FTC’s Bureau of Consumer Protection. “The defendants took in millions of dollars in donations meant to help cancer patients, but spent it on themselves and their fundraisers. I’m pleased that the FTC and our state partners are acting to end this appalling scheme.”
Background on Lawsuit
Cancer Fund of America, Children’s Cancer Fund of America, Cancer Support Services and The Breast Cancer Society primary purposes were to provide direct support to cancer patients, children with cancer, and breast cancer patients in the United States. In fact, consumers’ donations were wasted and misused, cancer victims were not helped, and the representations that defendants were legitimate charities were false. Among other things, defendants or their telemarketers often told donors their contributions would be used to provide pain medication to children suffering from cancer, transport cancer patients to chemotherapy appointments, and/or pay for hospice care for cancer patients. However, the defendants did not operate programs that provided these services.
The federal court complaint alleges that Cancer Fund of America, Cancer Support Services, Children’s Cancer Fund of America, and the Breast Cancer Society were sham charities, “operated as personal fiefdoms characterized by rampant nepotism, flagrant conflicts of interest, and excessive insider compensation, with none of the financial and governance controls that any bona fide charity would have adopted.” The sham charities spent more money on salaries than on the goods and services they provided to cancer patients.
In the eight-count complaint, the FTC and all the plaintiff states charged the defendants with misrepresenting the following:
- Contributions would be used for charitable purposes;
- Specific program benefits;
- Revenue and program expenses related to international gift-in-kind (GIK); and,
- The primary focus of their reported programs was to provide direct assistance to individuals in the United States.
Thirty-six states, including Michigan, also charged defendants with making false and misleading filings with state charities regulators. In addition, the FTC and 36 states charged Cancer Fund, Children’s Cancer Fund, and the Breast Cancer Society with providing their professional fundraisers with deceptive fundraising materials and thus the means and instrumentalities of deception.
Finally, the FTC and the plaintiff attorneys general charged defendants with violating the FTC’s Telemarketing Sales Rule. Cancer Fund, Children’s Cancer Fund, and the Breast Cancer Society were charged with assisting and facilitating in TSR violations and Cancer Support Services was charged with violating the TSR’s prohibitions on deceptive charitable solicitations.
Background on Concurrent Settlements
In settlements filed concurrently with the complaint, five defendants agreed to leave the charity business and to stop fundraising.
Children’s Cancer Fund of America and Executive Director Rose Perkins: Agreed to entry of a judgment for $30,079,821, the amount that consumers donated to Children’s Cancer Fund between 2008 and 2012. The judgment against Children’s Cancer Fund will be partially satisfied by payment of the proceeds of the liquidation of all its assets by a receiver. In addition, the receiver will dissolve the corporate existence of Children’s Cancer Fund and Rose Perkins will be banned from fundraising, from managing a charity, and from oversight of charitable assets.
Breast Cancer Society and Executive Director and former president, James Reynolds, II: Agreed to entry of a judgment for $65,564,360, the amount consumers donated to it between 2008 and 2012. Breast Cancer Society also agreed to the appointment of a liquidating receiver who will close its operations, liquidate its assets, and dissolve its corporate existence. In a separate order, Reynolds, II also agreed to a $65,564,360, judgment for the injury caused by the corporation he controlled and will be banned from fundraising, from managing a charity and from oversight of charitable assets.
Cancer Support Services president and chief financial officer of Cancer Fund, Kyle Effler: In a separate settlement, Effler agreed to entry of a $41,152,231 judgment, the amount that consumers donated to Cancer Support Services between 2008 and 2012. Effler, too, will be banned from fundraising, from managing a charity, and from oversight of charitable assets.
The action was filed in the U.S. District Court for the District of Arizona. The settlement agreements will not be final until approved by the Court. Litigation will proceed against Cancer Fund of America, Cancer Support Services, and James Reynolds, Sr.
Schuette’s 2014 Settlement with professional fundraiser Associated Community Services
On February 26, 2014, Schuette announced a $45,000 settlement with professional fundraiser Associated Community Services (ACS), of Southfield, to resolve complaints that it wrongly used the Attorney General Office's name to convince senior citizens to contribute credit card information via fundraising calls. ACS was a professional fundraiser for Children’s Cancer Fund, Cancer Fund and Breast Cancer Society.
Schuette requested a sample of ACS's call recordings during its investigation of the complaint. His Charitable Trust Section discovered several calls in which ACS appeared to be using the misleading credit card rebuttal. The transcripts and recordings of these calls were used in the FTC and multi-state lawsuit filed today against the charities.
Click here to download recordings of the calls: http://bit.ly/1EDpghs.
- Schuette, Flood Net $2.2 Million for Michigan Consumers in Western Sky and CashCall Settlement Involving High-Interest Loans
May 14, 2015
LANSING – Michigan Attorney General Bill Schuette’s Corporate Oversight Division and Michigan Department of Insurance and Financial Services (DIFS) Director Ann Flood today announced they have negotiated a $2.2 million settlement with South Dakota-based Western Sky Financial, LLC and California-based CashCall, Inc. The settlement resolves allegations of unlicensed loans made to approximately 17,500 Michigan consumers bearing illegally high interest rates. The settlement will automatically reduce the interest rate on all loans owned by Western Sky and CashCall to Michigan’s legal rate of 7%. Additional relief will be available for consumers who file a valid claim.
“We will not tolerate any businesses attempting to skirt the rules at the expense of Michigan consumers trying to make ends meet,” said Schuette. “This settlement is a victory for the thousands of Michigan consumers who took out Western Sky loans and serves as a warning to only do business with licensed entities. I am grateful for the joint efforts and hard work by the Department of Insurance and Financial Services and my staff that secured this settlement providing significant relief for Michigan consumers.”
“Western Sky's actions were illegal and unacceptable,” said DIFS Director Ann Flood. "The staff of the Department of Insurance and Financial Services, together with the Department of Attorney General, did an outstanding job on behalf of Michigan consumers.”
Western Sky assigned the loans it made to Michigan consumers to CashCall, Inc., which serviced and collected the loans directly or through its affiliates. Interest rates charged on Western Sky’s internet-based loans ranged from 89% to 169%, exceeding both the 7% interest rate legally permitted for unlicensed lenders and the 25% interest rate legally permitted for licensed lenders. Western Sky also charged processing fees of up to $500 on numerous loans, exceeding the $300 cap allowed for licensed lenders. As a result of these high fees and interest rates, a consumer who borrowed $1,000 from Western Sky would have to repay over $4,000 during the loan’s two-year term, representing an annual percentage rate (APR) of nearly 200%. Other Western Sky loans with a six-month repayment term carried an APR of over 350%.
In July 2013, DIFS commenced a cease and desist action under the Regulatory Loan Act against Western Sky to stop the company from making unlicensed and high-interest loans to Michigan consumers. That proceeding led to intensive negotiations resulting in this settlement. In September 2013, Western Sky discontinued any new lending in Michigan.
Under the settlement negotiated by DIFS and Schuette’s Corporate Oversight Division, Western Sky, CashCall, and their subsidiaries agree to the following:
- Cease and desist from making loans of any kind to Michigan residents unless the loans are fully compliant with Michigan law, including any applicable licensing requirements.
- Cease and desist from making any negative credit reports to credit bureaus, and within 14 days of the settlement request the removal of all pre-existing credit reports made by Western Sky, CashCall, or their subsidiaries, with respect to any Western Sky loans made to Michigan residents.
- Within 45 days of the settlement, permanently reduce the interest rate on all Western Sky loans still owned by Western Sky or CashCall to 7% annually on the loan’s then-outstanding balance of principal. This relief is automatic and does not require Michigan consumers to file a claim. However, these loans may still be collected at their current monthly payment amount until the outstanding loan balance (including unpaid principal, accrued but unpaid interest, and future interest on principal at 7%) is paid in full.
- Establish a $2.2 million settlement fund to be distributed pro rata to all Michigan consumers with Western Sky loans who file a valid claim and have repaid to Western Sky or CashCall more than their loan proceeds plus 7% interest annually. In addition, consumers who meet these criteria will have their loan recorded as paid-in-full, if the loan is still owned by Western Sky or CashCall.
- For Michigan consumers who file a valid claim and have repaid less on their Western Sky loan than the loan proceeds plus 7% interest annually, Western Sky and CashCall will: (a) adjust the loan balance to the difference between the loan proceeds minus all payments made; and (b) permanently reduce the interest rate on this adjusted balance going forward to 7% annually, if the loan is still owned by Western Sky or CashCall.
- Permanently cease and desist from selling or assigning Western Sky loans made to Michigan residents to any unaffiliated third-party, and provide information to DIFS and the Attorney General about any companies to which these loans have already been assigned.
How to Submit a Claim
Dahl Administration, LLC is the Claim Fund Administrator that will conduct the claim process and administer Michigan’s $2.2 million settlement fund. By July 20, 2015, anyone who took out a Western Sky loan while a Michigan resident should receive a notice in the mail from the Claim Fund Administrator explaining the process for filing a claim. Consumers not receiving notice through the U.S. Postal Service should contact the Fund Administrator at 1-866-336-5756 or visit www.MIWesternSkySettlement.com.
The deadline to file a claim is September 18, 2015. Schuette and Flood urge all Michigan residents who took out Western Sky loans to check their mail for this notice, and to carefully consider filing a claim in order to take advantage of the additional relief that may be available.
Where to Go for Additional Information
Residents who took out Western Sky loans are encouraged to call the Fund Administrator at the following toll-free number and to visit the following website if they have questions about the settlement: 1-866-336-5756 and www.MIWesternSkySettlement.com.
For further information, please visit the DIFS website at www.michigan.gov/difs
- Schuette, Wyant Announce $75 Million Settlement for Enbridge's Kalamazoo River Oil Spill
May 13, 2015
LANSING – Michigan Attorney General Bill Schuette and Michigan Department of Environmental Quality Director Dan Wyant today announced a $75 million settlement with Enbridge Energy, Limited Partnership and other Enbridge affiliates over the July 2010 Line 6B spill that sent more than 800,000 gallons of oil into Talmadge Creek and the Kalamazoo River from a pipeline owned and operated by Enbridge The agreement will finalize cleanup and restoration requirements for areas affected by the spill.
“This is a huge win for Michigan’s environment,” said DEQ Director Dan Wyant. “We are pleased to announce this settlement, because the key provisions are projects to improve and restore the river corridor. This settlement will mean improved water quality, improved fish and wildlife habitat, and an improved experience for river users in the years to come.”
“Michigan is the Great Lakes state and we must protect our precious natural resources now and for future generations,” said Schuette. “This settlement will help to restore affected waterways and wetlands, as well as provide improved access for families to enjoy the beauty of the Kalamazoo River. I am grateful for the work of my Environment and Natural Resources Division and the Department of Environmental Quality under Director Wyant.”
The Enbridge spill impacted more than 38 miles of river and 4,435 acres of adjacent shoreline habitat.
Under the settlement, Enbridge will pay:
- $30 million as estimated costs for Enbridge to restore or construct 300 acres of wetlands in the watershed for permanent protection.
- $18 million spent by Enbridge to remove Ceresco Dam in Ceresco, Michigan and construct other improvements to the river in the previously impounded area. These changes will help restore the run of the river closer to its natural historical condition.
- $10 million spent to construct and improve recreational and boating access sites for the public at five locations and provide an endowment for perpetual maintenance of the recreational/access sites. These sites include Saylor’s Landing and Ceresco Green in Marshall Township as well as Angler’s Bend, Paddler’s Grove, and Historic Bridge Park in Emmet Township.
- $5 million to be paid to the State by Enbridge for additional enhancement and restoration of the Kalamazoo River, to be paid within 30 days of the entry of the agreement.
- $12 million paid in reimbursement of the State’s costs in conducting and overseeing cleanup work, restoration and mitigation, and attorney’s costs.
The restoration projects are in addition to completing the cleanup work. The Consent Judgment, filed with Judge Sarah Lincoln in the Calhoun County Circuit Court on May 12, 2015, further requires Enbridge to complete cleanup of oil and oil-related contaminants from the release as well as to restore areas impacted by both the release of oil and aggressive recovery efforts. Enbridge will complete the cleanup of any remaining oil within approximately five years and will continue to pay the State's costs in overseeing all aspects of cleanup and restoration of the river.
In order to meet state law requirements and assure that liability for the release is adequately resolved, in the impacted area, Enbridge must:
- Continue to monitor and collect any sheen and submerged oil from the release in the Kalamazoo River.
- Thoroughly evaluate and address any continued presence of Line 6B oil and oil-related contaminants in soil and groundwater.
- Continue monitoring of affected wetlands and undertake restoration and treatment for invasive species consistent with approved work plans.
- Investigate and address impacts to aquatic life within the River or adjacent wetlands.
- Evaluate restoration actions to date within the affected area of Talmadge Creek and conduct additional activity as deemed necessary to restore stream habitat diversity.
- Ensure recovery of aquatic vegetation and protection of riverbank areas susceptible to erosion through additional surveys and implementation of corrective actions as needed.
- Replace woody habitat removed from the River during oil recovery efforts.
- Provide funding for the state to conduct additional monitoring to assure that fish and macroinvertebrate communities are recovering and fish consumption advisories for oil-related contaminants remain in place as needed.