Man tells feds: I bribed Kilpatrick

Jennifer Dixon and M.L. Elrick

Oct. 29, 2009 (McClatchy-Tribune Regional News delivered by Newstex) -- A Chicago businessman has described to federal investigators what he alleged to be a wide-ranging scheme to corrupt then-Detroit Mayor Kwame Kilpatrick and other metro Detroit officials with cash and tickets to sporting events.

John Orecchio, the businessman, also told investigators that he and others contributed up to $40,000 to Sharon McPhail's 2005 mayoral campaign -- which McPhail denied -- and provided gifts worth more than $50,000 to two Wayne County pension trustees for their support of his business endeavors.

The allegations are contained in scores of pages of detailing interviews Orecchio had with FBI agents, federal prosecutors and investigators from the U.S. Labor Department from late 2006 to early 2008. Orecchio's attorney, William Ziegelmueller, declined Wednesday to discuss Orecchio or the documents, which the Free Press obtained.

In July, Orecchio was charged in U.S. District Court in Chicago with two counts of cheating union pension funds, primarily from metro Detroit, out of millions of dollars. That case is pending.

Kilpatrick, McPhail and Patrick Melton, one of the Wayne County Employees' Retirement Board trustees named by Orecchio, denied any wrongdoing. Kilpatrick denied through his lawyer.

Among the claims Orecchio made to investigators was that he paid $10,000 to the Kilpatrick Civic Fund to help win the mayor's support for a $20-million deal between his company, AA Capital Partners, and one of the city's pension funds.

Orecchio said that when he later made a presentation to the fund, it appeared the board was going to vote against AA Capital's deal, until Kilpatrick appeared personally in 2005 and urged board approval.

The board approved the investment that December, but the money was never invested.

Kilpatrick attorney Jim Thomas said Wednesday his client "flatly and unequivocally" denies any wrongdoing.

Orecchio also told investigators that he contributed tens of thousands of dollars -- much of it through surrogates -- to keep McPhail, who was then a Detroit city councilwoman, from opposing a deal involving a strip club he was buying and to win her support as a trustee on the city's police and fire pension board.

Orecchio gave investigators a list of people who he said he used to contribute $40,000 to McPhail's 2005 mayoral campaign. The Free Press could find only three of the people on the list on McPhail's campaign finance reports.

"Nobody raised $40,000 for us during that period," McPhail said Wednesday. "I wish that they had."

She said the newspaper's finding that only three of the people Orecchio listed had contributed $3,400 each to her campaign showed he lied.

"I had nothing to do with this," she said.

Rick Robinson, a former McPhail aide whom Orecchio said he paid to influence the councilwoman, also said Orecchio was lying.

Melton, the Wayne County pension trustee, also denied Orecchio's claims. Orecchio said he gave Melton tickets to the 2006 Super Bowl in Detroit and a Playboy party afterward.

In an e-mail to the Free Press, Melton said the pension board did not invest with Orecchio's company. As for the Super Bowl, he wrote: "I purchased my own tickets to the game and have cancelled checks verifying this fact."

Contact JENNIFER DIXON: 313-223-4410 or jbdixon@freepress.com

Newstex ID: KRTB-0048-39259783