Did Bobby Ferguson use state grant money to flip a Detroit home?

DETROIT (WXYZ) - Not long after he got a check for a quarter million dollars in grant money, Bobby Ferguson used it to buy a small duplex on Meyers street.  Living in the unit next door was a Detroit husband and wife.

Today 7 Action News spoke with the wife, who asked that her voice be altered in our interview and her name be withheld.

The couple became a part of the feds case this week, and yesterday the husband testified in court about what he saw living next to Ferguson.  The feds say he committed fraud with your tax dollars.  In court, Ferguson’s lawyers say he bought this home to turn it into senior citizen housing.  But his old neighbor is telling us a different story.

"Did you ever see any sign that they were going to turn that into senior citizen housing," asked 7 Action News reporter Ross Jones.

"No, I I never seen a sign, there was no sign," she said.

Ferguson’s lawyers say he never got around to turning it into a senior home because the state pulled the rest of Ferguson’s grant money over concerns he was misspending it.

Still, his neighbors say Ferguson didn’t even maintain the home.

"We have a little child, and it seemed dangerous to live next door to a house that’s not well-maintained, the grass was up high and everything," she said.

So, she said, they decided they’d buy it and clean it up.  When they pulled the deed, she said it came back to Ferguson Enterprises. Bobby Ferguson’s lawyers have said in court that the home wasn’t bought for their client or his company , but for his non-profit group, Detroit 3D.

"Did the name Detroit 3D, does that mean anything to you, did you ever hear that when you were trying to buy this house," asked Jones.

"Never in my whole life, never," she said.

Ultimately, Ferguson sold the home for $50,000.  He had purchased it, with state tax dollars, for $25,000.