The Detroit Riverfront Conservancy on Wednesday filed a civil lawsuit against its ex-Chief Financial Officer Will Smith, his relatives and associated companies in an attempt to recoup $40 million the nonprofit claims was stolen in an “elaborate scheme and cover-up.”
The suit, filed in Wayne County Circuit Court, names Smith’s wife, mother and sister as co-conspirators who benefited from his alleged theft. The filing also contends Smith’s close friend, local businessman Darrell Greer, attempted to hide assets from authorities once the conspiracy was uncovered.
The suit comes after Smith was charged last month with bank and wire fraud in a federal criminal complaint, alleging he embezzled the funds for his own use over a dozen years. The U.S. Attorney’s Office has placed liens on Smith’s real estate and his holding companies.
The filing is among the efforts being undertaken by the conservancy to investigate the theft and “hold any wrongdoers fully accountable,” restructure executive leadership, strengthen financial controls and sustain its work to beautify the Detroit Riverfront, a news release notes.
Former U.S. Attorney Matthew Schnieder, now an attorney for the Honigman Law Firm, is representing the conservancy in the civil suit and laid out during a Wednesday media briefing Smith’s alleged scheme to spend the conservancy’s money “on personal whims.”
Schneider noted 469 wire transfers that amounted to nearly $39.3 million.
“So, with that in mind, that’s why we’re bringing this suit,” he said, noting the conservancy is trying to recoup all of the damages it is entitled to under law.
Smith’s attorney and Greer could not be immediately reached Wednesday for comment.
Separately, Schneider is leading two investigations for the conservancy: an analysis of the alleged theft by Honigman as well as a financial analysis by the auditing firm PwC; both remain ongoing, he said.
“We don’t know the extent of everything that Will Smith did,” he said during the briefing. “We don’t know the full extent of what he did with the finances. We believe Smith may have stolen money from the conservancy in other ways and we are still investigating those allegations.”
Schneider added he couldn’t yet go into further detail but said “we will file another complaint, or amendment if necessary when the appropriate time comes. In terms of other conservancy employees playing a role, Schneider said the focus right now rests with Smith and the alleged co-conspirators named in the civil complaint.
Just before Smith was charged by federal authorities last month, the conservancy announced his firing as well as the resignation of longtime Chief Executive Officer Mark Wallace, who will aid the conservancy as a consultant.
Conservancy Board Chair Matt Cullen said in a Wednesday statement that on behalf of the RiverWalk supporters the organization is “seeking and seizing every stolen dollar possible” from Smith and his alleged co-conspirators.
“From the moment this scheme was discovered, we promised to investigate what happened, fix it, and make sure it can never happen again,” Cullen said.
The suit claims Smith confessed his misdeeds to Greer, a long-time friend and confidant before the theft was made public and allegedly asked Greer to accept the transfer of a Detroit home.
Charlotte Smith, Kimberly Smith and Jennifer Smith – William Smith’s mother, wife and sister, respectively – are accused of spending lavishly using conservancy money on high-end interior design goods, beauty supplies, shoes, restaurant meals and assorted other luxuries, the suit argues.
Also named are two companies owned by Smith, William Smith & Associates LLC, and the Joseph Group, as well as one owned by Greer, You Services LLC. You Services provided construction management services to the conservancy, the complaint notes.
The civil filing claims Smith transferred funds from the conservancy’s primary operating account at Citizens Bank into a lesser-used conservancy account at Comerica Bank. He then withdrew funds from the Comerica account by paying his personal American Express card and by wiring payments to his private business, the Joseph Group.
Smith, it adds, took steps to prevent others at the conservancy from accessing the Citizens Bank and Comerica Bank account records, creating forged account statements and false line items in the Comerica statements to explain his transfers. The conservancy argues that Smith “painstakingly created hundreds of pages of fraudulent financial reports and budgets” to create two sets of books and never allowed the board to have an accurate view of the conservancy’s true finances.
He’s also accused of securing a $5 million line of credit from Citizens Bank to replenish some of the money he had stolen from the Citizens account and provided a forged statement purporting he had the authority to seek out the line of credit, it says.
Funding, the conservancy contends, was used by Smith and his family members “to live a lavish lifestyle.” Smith himself, the nonprofit said in its news release, spent the money on NFL tickets, limousines, hotel, airfare, jewelry, clothing and high-end goods from the likes of Gucci, Louis Vuitton and Diamonds Direct.
“This suit is just one piece of our framework for accountability,” Ryan Sullivan, the Conservancy’s new CEO, added in a Wednesday statement. “We will be relentless in pursuing our claims and seizing the money stolen by Smith and his co-conspirators.”