Feds continue to hammer on Civic Fund in Kilpatrick Corruption Case

DETROIT (WXYZ) - The government continued its assault on Kwame Kilpatrick's non-profit fund.

On Tuesday, a woman the former Detroit mayor turned to to help save his career took the stand against him.

The hit ABC TV show "Scandal" is based on her crisis management work but Judy Smith had to face a real life drama unfolding inside the federal courthouse in Detroit.

The Washington D.C.-based crisis manager took the witness stand in the Kilpatrick Corruption Case, to testify about how her company was paid for work she did for the former mayor.

Smith said in all, she was owed about $180,000 for her work with Kilpatrick, but never received all of it.

Smith was once the deputy press secretary for President George H. W. Bush – and she has handled high profile clients like Monica Lewinsky and Michael Vick.

Kilpatrick hired Smith in early 2008 – and she told the jury that she helped develop communications strategies for the former mayor's extensive legal team at the time.

That team included Jim Thomas – who had to cross examine Smith today.

Federal prosecutors showed the jury two different checks totaling more than $70,000 that were written to Smith's company from the Kilpatrick Civic Fund account. Kilpatrick is accused of using the non-profit illegally to pay for personal and political expenses.

Smith told the jury she didn't know what the Civic Fund was – and that she was working for the mayor, not the non-profit.

Meanwhile, representatives from 4 different financial investment firms took the stand to testify about $33,000 in various donations their companies gave to the Civic Fund.

None of the witnesses wanted to talk to reporters today – but they all told the jury, if they had known the money would be used for personal or political gain – they would never have made the donations.

When Thomas cross-examined each of the four witnesses, they admitted they didn't know for sure if their donations had been misspent. And Thomas kept asking if they understood that the Civic Fund wasn't a 501c3 Charity, but rather what he calls a 501c4 non-profit corporation.

"It is a corporation that can do certain things, and we've tried to bring that out in our cross examination. And certain things that are proper and authorized under the IRS code. Now, without getting into the facts of the case, that is the issue… What were the funds used for? Whether or not that was defendable to the people who were running the corporation, or whether it was defendable in the court of law, now in hindsight," Thomas told 7 Action News Investigator Heather Catallo.

Testimony about the Kilpatrick Civic Fund continues on Wednesday.
 

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