Schuette Wins $138,000 Judgment Against Nneka Cheeks for Diverting Funds from Manoogian Mansion CharityContact: John Sellek or Joy Yearout 517-373-8060
May 12, 2011
DETROIT - Attorney General Bill Schuette today announced that Ingham County Circuit Court Judge Joyce Dragunchuk has entered a formal default judgment against a former City of Detroit mayoral employee accused of diverting thousands in charitable funds for her own personal use. The formal default judgment entered late yesterday, finds that Nneka Kafi Cheeks, 40, of Livonia, "wrongfully converted no less than $34,524.27" in charitable funds from the Manoogian Mansion Restoration Society for her own expenses. The judgment orders Cheeks to return the money, with interest, and to pay damages in the amount of triple the sum she wrongfully diverted, for a total liability of $138,866.33.
"Charitable organizations are not to be used as a piggy bank for personal expenses," said Schuette. "This should send a clear message: If you break the law, there will be consequences."
Cheeks must now pay restitution and damages to the Society, now known as the Mayoral Residence Society. The charity was established in 1994 to assist the City of Detroit in restoring, furnishing, and preserving the Manoogian Mansion. The judgment entitles the Society, the victim of Cheeks' actions, to pursue Cheeks for payment.
The Attorney General's Charitable Trust Section filed the civil complaint against Cheeks in August 2010. The complaint asked the court to order Cheeks to account for the funds she handled, to return the money, and to pay damages in the amount of triple the sum she wrongfully diverted as provided under Michigan law (MCL 600.2919a). Although Cheeks acknowledged receiving notice of the Attorney General's complaint, she failed to appear individually or through her attorneys to defend the lawsuit.
In addition to today's civil judgment, Cheeks currently faces criminal charges filed on April 28, 2011 by Schuette's Public Integrity Unit. The charges allege that an investigation by the Attorney General's Charitable Trust Section and Criminal Division revealed that Cheeks, while employed with the City of Detroit Mayor's office, had access to the Manoogian Mansion Restoration Society's bank account and embezzled more than $19,000 of the Society's charitable assets between 2007 and 2009. Schuette alleges that Cheeks wrongfully exploited the charity for her own private financial benefit.
Questionable expenses addressed in the criminal case include:
$1,140 to Brides Made Fit for in-home personal fitness training;
$450 to Dr. Mok's Allure Medical Spa for cosmetic injection treatment;
$3,590 in payments to The Roostertail restaurant for Cheeks' wedding reception;
$2,619.08 to Jewelry Factory in Livonia for diamond jewelry;
$3,943.40 to Pioneer Credit Recovery to pay off a relative's debt;
$3,091.95 to Art Van Furniture for living room and dining room furniture;
$1,300 to Michigan Veterinary Specialists for the care of Cheeks' dog, Trouble, and;
$4,025 in cash withdrawals.
Cheeks is charged with:
One count of Conducting Criminal Enterprises (Racketeering), a 20-year felony;
Seven counts of Embezzlement from a Charitable Organization - $1,000 - $20,000, a ten-year felony, and;
One count of Embezzlement from a Charitable Organization - $200 - $1,000, a five-year felony.
Cheeks was arraigned on the criminal charges and released on a $25,000 personal bond on April 29, 2011. She will next appear in 36th District Court for a preliminary examination on a date to be scheduled by the Court.
Upon taking office, Schuette announced the creation of the Public Integrity Unit (PIU). Since then, 52 criminal charges have been filed against individuals holding positions of public trust, including state and local government officials.
A criminal charge is merely an accusation and the defendants are presumed innocent unless proven guilty.