Live Blog: Kwame Kilpatrick Trial Day 60 - Boston News, Weather, Sports | FOX 25 | MyFoxBoston

Live Blog: Kwame Kilpatrick Trial Day 60


Judge Edmunds says it's Friday, 5 minutes to one. Says there's likely to be additional coverage since the trial is winding down, commends the jury for their diligence in avoiding news coverage, reminds them they can't talk about it.

Elrick will have the latest on Kwame going back to jail this afternoon, and spending the weekend behind bars for violating his parole.

We'll also have the highlights of today's testimony on Fox 2 news plus M.L.'s unique takeaway on


Selz says for 2008 Kwame had 250,250,47 in unreported income. Total tax for all years was $195,403.61.

Bullotta shows Selz' summary of unreported income, showing the same figures.

Selz says he did a separate sheet for 2008 because the charge is tax fraud. Says the taxable income from the tax return is41,000 and he should have reported 291,000. He owes 72,000 for 2008.

Bullotta asks if he took into consideration birthday checks. No. Private jets. No. Got cash for suits. No. Selz says this is strictly cash that went into banks, or cash payments to credit cards.


Bullotta calls Carl Selz, he works for the IRS. He was a Detroit Cop, worked for the IRS, got trained as a fraud examiner, he's an expert.

Bullotta asks if he's qualified as a tax expert. Yes. Testified before, too.

Says he was brought into the case as an independent witness, listens to all the stuff taken into evidence, the Judge tells him to slow down....

basic he's an independent arm of the government, meets with the assistant district attorneys, he comes up with a summary of the evidence placed into evidence. Says he's not an automatic for the government, doesn't automatically accept everything that's put in front of him.

Selz says he makes adjustments to the computations, says after looking at all the items his opinion on the income stated is correct.

A juror asks a question. Bullotta asks if he formed an opinion on the Kilpatrick's returns.

Bullotta asks if after looking at all the evidence did he form an opinion. Yes.

Bullotta says he'll get to his opinion in a second but did you determine the information in this case is accurate. Yes.

Bullotta shows a summary of the criminal tax due. For 2002 through 2008

First row is Taxable income reported per return. For 2003 it's 152,806, this is right off the tax return.

Next column is the adjustments to income that he made. For 2003 the cash deposits to Chase bank is 36,100. 41,100 in cash payments to the credit card. 900 from the Civic Fund. Total is 78,100 for a total of 229,906 in corrected taxable income, and tax owing is 23,857.48.

Selz does this for all the years. Kilpatrick's owe 17,701 for 2004, 22,969 for 2005, 29,933 for 2006, 28,440 for 2007, and 72,501 for 2008.

Selz is talking about from 60,000 to 250,000 in unreported income per year. For a total of $195,403.61.


Bullotta shows chart, 604,777.57 net wages, expenditures 1,446,739.00, in excess of wages 840,962.33. Asks if Sauer saw that Kwame went into debt. No.

Thomas asks if the money that Bell, Kado, and Miller, didn't actually give money to Kwame. Sauer says if they didn't give him money it wouldn't be taxable. Thomas says it will be up to the jury to decide on the credibility of the witnesses.

Thomas asks about Carlita's account. Asks if she could have given cash to Kwame. Sauer says that's true.

Thomas asks about the United account. Sauer says he didn't include that. Thomas asks what the total of the two accounts would be. Sauer says 17 (17,000) Sauer says he did not deduct this from his survey. Thomas asks if his graph is not accurate because he didn't include these figures. Sauer says his graph is accurate.

Thomas asks if Kwame's credit union account was included. Yes.

Thomas asks if he's not an expert in 501c-4 corporations. Correct.

Bullotta asks if Carlita took every cent out of her account and gave it to Kwame would it close to 840,000.

Thomas back, asks if he included cash gifts. Sauer says there was no evidence of cash gifts in the 840,962.33. Sauer says the answer is no and no cash loans were found by his investigation.


Bullotta is back, showing Kwame's resignation letter from the Civic Fund. Puts up the check to the Sonnenalp resort from November 2002. Sauer says he also testified about text messages from the same time. Bullotta asks about a text between Beatty and Kwame...

Thomas pops out of his seat... Judge asks for a sidebar.

Bullotta asks again about the text messages, asks if Kwame asked Beatty to get a Civic Fund check out of his bag, that was after he resigned. Sauer says that's correct.

Bullotta now showing the documents Thomas showed him, the 4400 deposit. Sauer says the date is October 20 2008. Bullotta asks about the birthday checks, gifting. First check is date October 22 2008. next few checks are the same date. Bullotta asks if he could have taken these checks to a check cashing business and deposited them on Oct 22 of 2008. Sauer says no.

Bullotta asks if he totaled the checks from the June 26 time frame. Sauer says that he didn't include these checks in his summary. They total just shy of $4000. Bullotta asks him if he remembers that Thomas says he could have gotten cash. Yes.

Bullotta asks about time frame of party. Sauer says he looked at cash payments/deposits around that time. Sauer says they are now looking at cash credit card payments at the bank. Are this the only cash transactions you found. Yes.

Bullotta asks if there are cash payments after-wards. Sauer says that's correct. All the way through 2008. Correct.

Bullotta shows a ten dollar check. Sauer says he didn't cash it, he deposited it into his account. Bullotta shows the largest check, $1000, asks if the people who gave this check also gave to the civic fund. Sauer says yes and these checks were not included in his cash summary.

Carlita's account at Comerica. Sauer says it was closed in 2004. Bullotta asks if her Unite account and the Comerica account could have been a source of Kwame's cash. Sauer says he didn't see enough money withdraw to account for all the cash in Kwame's finances. Says Carlita had 26,000 in withdrawals from late 2002 though 2004.


Sidebar is over, Bullotta says now I want to show you a clip from the debate, after those meetings. On the tape Kwame says we didn't use one penny of the civic fund for this campaign because it's not allowed by law. Sauer says he heard Kwame say that.

And the jury asks for a break.


Bullotta on redirect, puts up the Subpoena to the civic fund on August 13, 2008. Sauer says the Civic Fund was notified of the investigation way before that cashier's check from Apr; 13 2009 was given to the fund. Sauer says this was only a drop in the bucket compared to what he calculated was income for Kwame from the Fund.

Bullotta asks if he remembers testimony that some of those trips were when the Kilpatrick's were shopping for homes. Yes.

Bullotta asks about the restated articles of incorporation, anywhere in here is it listed personal use by members. NO. does it say they'd pay for campaign expenses. No.

Bullotta asks him to read, not withstanding the corporation shall not carry on any activity no permitted... by the Internal Revenue Code.

Bullotta asks if the IRS ever got the restated articles. No.

Bullotta asks why the IRS was involved. Sauer says they applied for tax exempt status.

Sauer says this is a tax exempt corporation. Bullotta now puts up the records from the law firm. Asks him about the thing Tomas asked about. Do yo see august 2001. Yes.

Meeting with Berg, Kilpatrick. Yes. That Kwame was getting legal advice from his attorneys. Thomas objects. Judge tells him the government can ask the same types of questions he can ask, and over rules him.

Bullotta asks about the debate the members had after they talked to his lawyers. Yes.

Bullotta gets ready to play a tape and Thomas asks for a sidebar.


Thomas asks if he sees trips to Texas related to the Civic Fund. Sauer says he's not aware of any Civic Fund trips to Texas.

Thomas asks if it's true... Judge Edmunds says just because a lawyer puts facts into a question doesn't make those facts true.

Thomas asks if 'Sauer remembers that Comerica Bank moved out of Detroit. That they moved to Dallas. Sauer says Texas, doesn't know if it was Dallas.

Thomas asks if the city did banking with Comerica and that Kwame was critical of the over. Sauer recalls seeing news coverage.

Tomas asks if there were negotiations with banks in Dallas Texas. Is it true Kwame met with the banks to transfer the accounts in 2008 at it regarded the expense from the Civic Fund. Sauer says what he recalls is the Kwame said in the news he didn't want to do business with Comerica Bank any more.


Thomas asks about another Texas trip when Kwame met with Rev. T. D. Jake's. Sauer says he doesn't know about that meeting.

Thomas puts up a check from the Civic Fund to Potter house for $1000.

Thomas now says he's going to test your math. A Juror asks to see the Potter house check again.

Says we've seen certain checks, towards that end, for demonstrative purposes he's going to write this down. Hilton Dallas, Thomas writes 5180.00. Judge Edmunds asks if Sauer can trust that the numbers Thomas puts up are accurate. Thomas says it's a trust issue Judge, gets a laugh from the jury. Sauer jokes he has very little trust in Thomas' math ability. Thomas laughs...





more numbers....

Thomas says I'm going to ask you to add those up for me... because there are trust issues. Sauer pulls his cell phone out of his pocket and uses the calculator.

Sauer totals13,027.73. Thomas writes 13027.64. Sauer says no it's 73 cents. It's Friday and after 60 days of testimony things are pretty relaxed in the court room. Thomas is most amiable.

He asks if Sauer remembers the subpoena to Pepper-Hamilton and difficulty getting materials from Phillips firm. Sauer says he has a vague recollection.

Thomas says and you corrected me on my math, I'm going to show you and ask what you see here. Sauer says he sees a cashiers check to the civic fund for 13027.73 August 13 2009... no it's April. Thomas says it looks like the sum total of the trip expenses. Sauer says yes. Nothing further.


Thomas asks if he sees trips to Texas related to the Civic Fund. Sauer says he's not aware of any Civic Fund trips to Texas.

Thomas asks if it's true... Judge Edmunds says just because a lawyer puts facts into a question doesn't make those facts true.

Thomas asks if 'Sauer remembers that Comerica Bank moved out of Detroit. That they moved to Dallas. Sauer says Texas, doesn't know if it was Dallas.

Thomas asks if the city did banking with Comerica and that Kwame was critical of the over. Sauer recalls seeing news coverage.

Tomas asks if there were negotiations with banks in Dallas Texas. Is it true Kwame met with the banks to transfer the accounts in 2008 at it regarded the expense from the Civic Fund. Sauer says what he recalls is the Kwame said in the news he didn't want to do business with Comerica Bank any more.


Thomas asks about tip expenses. Sauer says he has no knowledge that this trip was related to Civic Fund work.

Hilton South Lake Hotel, was that included. Yes. Super camp. Yes. This was an educational camp. Sauer believes so. Sponsored by an Icy league college, would you agree it was an educational experience. Sauer says for the Kilpatrick twins yes. Thomas asks if the Civic Fund had educational purposes. Sauer says but not for the figure heads kids. Thomas says that's your opinion. Sauer says yes it is.

Thomas says these are what you looked at and added to Kwame's income. Sauer says yes. Thomas says rather that argue with you I'll continue to go forward. He points out some more expenses including the moving expenses.

Thomas asks if Sauer remembers the meeting Kwame called after he had resigned from office. Thomas says he was convicted in Wayne county. Sauer says he plead guilty. Thomas says this was at or about the time this meeting took place.

Thomas says he had no place to stay, the Tallahassee house was sold, he couldn't go there because he had to serve his sentence. He had no job, no place to stay, was travel restricted, when the meeting occurred. Sauer says he doesn't what all was in place when the meeting took place.

Thomas says do you remember the board decided to pay for his expenses. Judge Edmunds tells Thomas he can't ask a question about hearsay. Thomas says but I'm not offering for the truth, as we've heard in court so many times before. Judge says but you are offering it for the truth.

Thomas asks if Kwame ever contributed to the Civic Fund. Sauer says you'll have to refresh my memory he may have.

Thomas puts up a check from Kwame for 1500.

Sauer says it appears in May of 2005 he donated $1500 to the Civic Fund.


Court is back in session.  We're waiting for the members of the jury to take their seats.

Thomas returns to the lawyer billing statements. Runs through a long list, says they're looking at the Rutherford document and it's the same time frame.

Thomas is interrupted as Judge Edmunds blows her nose (right into her microphone), Thomas smiles, says bless you, long pause, Judge Edmunds says thank you, jury laughs.

Thomas returns, says a lawyer was retained to reply to the subpoena to the Civic Fund. Sauer says information was supplied. Thomas says this lawyer was different than Phillips and the records had been requested for a long time. Sauer says he can't remember exactly how long.

Thomas puts up Sauer's chart showing the Civic Fund expenditures. Asks about Spy-Ops. Says we heard a witness say there was a desk with Warren Evans name plate, and this was related to a service provided for DE-bugging. Sauer ways this check isn't related to that.

Thomas asks if

Evans had a desk there. Sauer says he remembers testimony to the contrary. Thomas asks if he remembers hearing that the equipment is at the police department. Sauer says he doesn't know where it is but did hear that.


And we're on break.


Judge Edmunds want to clarify for the jury that this witness doesn't have personal knowledge because he wasn't at the law firm. She says the defense has no obligation to call any witnesses but that doesn't over ride the governments right to object about this witness answering questions.

Judge Edmunds says with that we'll take our break.


Thomas asks about a reference to Don Barden. Sauer only knows he's a business man. Thomas goes on to more lawyer billing statements. August 2001 bill for a period covering July 2001. Asks to have the Rutherford "news splash" put up. (I don't know where the term "news splash" came from, we don't use that term.)

Thomas says he wants to frame the date august 29 2001. Says he want to talk about further billings. Now he's showing an October bill from a new firm. Sauer says he believes Pepper-Hamilton is a national firm and Phillips was a partner now.

Thomas asks if he sees references to the IRS code. Yes.

Further review for 1.75 hours. Sauer says he sees that.

Thomas says on August 24 something new comes up. Sauer sees it. Review of IRS code. Yes.

Thomas says they spend a significant amount of time. Sauer says it looks like it covers a conference with Phillips regarding non-profit tax issues, 502c-4 issue.

Thomas says it references all the areas they talked about. Sauer agrees.

Thomas says we've seen the Rutherford exhibit on the 29. Says there are several things that have occurred, that MR. Berg and Beatty met for a long time, 6 hours.

Bullotta objects that we can't tell from this record how much time was spent on each item. Judge Edmunds agrees. Thomas says there are several things at issue here.....

Side Bar!


Thomas asks about William Phillips being the attorney for the Civic Fund. Thomas tell the Judge he's withdrawing the Ayanna signed document and he's going to show a Miller, Canfield document concerning Phillips. Sauer says in some point in 2008 he stepped away.

Thomas says after Kwame had been convicted, are you aware of a meeting at the Manoogian. Sauer says yes.

Judge Edmunds asks Tomas to make the time line more clear.

He says Kwame went to jail in October of 2008. Just before he went in. Sauer says yes, sometime before he went to jail.

Thomas says the importance is whether Phillips was there. Bullotta objects. Judge Edmunds over rules. Sauer says he doesn't know if Phillips was there.

Thomas says Phillips was working at a large law firm. Yes.

Thomas says what you have before you is a billing for a period of time. Yes.

Thomas says if refers to a Rutherford news splash. Sauer doesn't recall the specific date of the article.

Thomas asks when Phillips started according to the document. Sauer says 04/28/1999.

Thomas points out more entries, says we also have a reference to Beatty at the civic Fund. Sauer agrees.

Thomas asks if Phillips was actively involved in reviewing IRS and State documents. Sauer says it appears so.

Thomas says the board was working on the file so Phillips was not operating in a vacuum. Sauer says it appears that way.


So Thomas grilled Sauer about not being able to find all the cash that MAY have been given to Kwame as gifts, but Sauer said it wouldn't effect the tax case anyway. Then he moved on to the Articles of Incorporation for the Civic Fund.

That's what he's back on now. He asks Sauer if he sees the restated articles were submitted to the State of Michigan. Sauer says yes.

Tomas points out the changes including that no funds will be used for a candidate's campaign.

Thomas says okay what was going on in July of 2001 pertaining to political activity. A jury asks a question, who signed it. Thomas shows Miller's signature and Sauer read July 24, 2001. Thomas asks if that's consistent with it being received on July 26. Yes.

Thomas puts up a new document, says it's date July 23rd 2004, signed by Ayanna, Beatty, and other officers of the corporation, Derrick Miller, Erik Rayford, and William Phillips.

Thomas says Williams is the lawyer and the Secretary. Sauer says yes.

Thomas says but Kilpatrick's signature is not on it because he's withdrawing. Sauer says yes he's taking his name off the corporation. Sauer says he now has no official capacity.

Sauer says he signed checks after that. Thomas says he may have pre-signed checks. Sauer says he doesn't think that's really important. Thomas asks if there was an audit, but it was stopped by the criminal investigation. The Civil work ceases at that point.


Thomas is now asking if Sauer knows that the Kilpatrick Civic Fund Articles of Incorporation were amended. Sauer says the amended articles were never submitted to the IRS. Thomas says are you testifying the articles were never amended. Sauer says they were never sent to the IRS. Thomas asks him again. Sauer says he can see on the document that they were changed but the changed were not sent to the IRS. Thomas says but it says submitted here? Sauer says it looks like the amended articles were sent to the State. But not the IRS.

Thomas is reading the articles now. Sauer says he can see them on the screen.

Thomas says now I want you to see what was originally submitted. Sauer says these were the only thing submitted. Thomas says but you can see they were submitted. Sauer says but not to the IRS.

Thomas reads the part where it says no part will go toward a candidate.... Sorry, he's standing in front of the projector and away from the microphone. And they go to a side bar.


Thomas asks if Sauer knew about a party where gifting was going on before Kwame went to jail, that his Mom gave him $4,000 for the Cadillac. Sauer says he wasn't aware of the party.

Thomas puts up the cashier's check from his Mom for the Cadillac he bought when he came out of jail.

Thomas asks if Sauer thought, since Kwame was getting gifts, that he should look further into gifting. Sauer says this isn't relevant to the tax charge anyway. Thomas says but does it effect your investigation. Sauer says this was to purchase the car.

Thomas now moves to October 2008 transactions and asks to move them into evidence. Bullotta objects. Thomas explains they had a side bar about this check, that he won't violate the ruling during the side bar. Judge Edmunds receives the UN-obejcted portion of the document objected to..

Thomas says these are from the time Kwame was about to go into the Wayne County Jail. Sauer says deposit slip they're looking at and this transaction was in his chart. Sauer says this looks like Kwame's handwriting. It's a deposit for $4400. Sauer agrees it was the week before he went into jail. Thomas puts up another for 1400. Now a check for 100 on Oct 22. Another check with no date but in memo line it says, "love you."

Thomas asks if it's a gift. Sauer says he can't say that. Thomas says you can't or you won't?

Thomas puts up more 100 dollar checks with love you in the memo line.

Now a check for 250 from the time Kwame came out. Thomas asks if this indicates that gifting to him was going on. Sauer says check are not captured in the cash analysis. Thomas asks if that peaked his interest that cash may have been there from gifting.

Sauer says it did, and those people were placed in the grand jury. Thomas says certainly since you didn't know about party, How would you know unless you ruled out that there was no cash given to him at that party.

Sauer says the evidence does not support your theory.

How could you takes steps to investigate if you didn't know. Tells Sauer he didn't know that there was gifting by employees of the city of Detroit. Sauer says you're claiming gifting by employees is a gift. Thomas says I'm trying to determine the sum total of your knowledge.

Sauer says that gifting tag is your tag not your tag. Thomas says you didn't know about these gifts and you didn't include it into you chart. If you didn't know about it you couldn't account for it. Sauer says if he used the cash or deposited the cash they'd know about it.

Thomas says I'll leave your logic to be determined by the jury.


Thomas continues, says if there was a party, if people gave cash, you wouldn't have that record. Sauer says that's possible.

Thomas asks if he looked at all the check cashing stores in the area, did you issue any subpoenas? Sauer, I did not.

Thomas asks about Western Union. Sauer says he'd have to check the record.

Thomas says that would be an indication that additional cash was available to Mr. Kilpatrick. Sauer says he saw no evidence except the bank accounts, that the evidence doesn't support what you're portraying.

Thomas says you can't know how much cash was available to his client without investigating the check cashing stores. Sauer says he did not look at the check cashing stores but the evidence doesn't suggest that Kilpatrick used any.


Judge Nancy Edmunds takes the bench and court is officially in session. She reminds Special Agent Sauer he's still under oath. Jim Thomas steps to the podium and asks about the cash transactions into Kwame Kilpatrick's account.

Says he's trying to figure out if this is the entire world of banking for the Kilpatrick family. Asks if Carlita's United Bank account is in the summary. Sauer says no. Adds that they also subpoenaed a credit union account for the Mayor's wife but did not get anything back.

Thomas asks why there is no information for 2001. Sauer says there were no cash deposits or expenditures.

Thomas reminds Sauer that they talked about the party at the hotel and that gifting was going on. Thomas refers to his math mistake yesterday, teases Sauer about not catching it. Sauer says he'd rather not be dragged into it. Judge Edmunds says we all let it go. Thomas asks if Sauer has his calculator in his pocket. Sauer says it's in his pocket. Thomas is referring to saying yesterday that 200 people at $50 equals $10,000. Sauer adds he doesn't do math on the stand. Thomas says oh it's all my fault? Sauer says I don't know why my face is red. The audience and jury are laughing


The Picture is up in the overflow room here on the first floor. The defendants and their attorneys are seated  at the defense table.  Kwame Kilpatrick is looking relaxed as he thumbs through documents.


Kilpatrick's attorney Jim Thomas said on his way into court this morning that his client's incarceration this weekend will not delay the defense team's case.  You can see that brief interview on Fox 2 News this morning.


Good morning from the City of Detroit and the Theodore J. Levin Federal Court House, where, right after court today Mr. Kwame Kilpatrick will be heading back to prison for violating his parole.

Ken Martinek is Senior Producer-Investigations for Fox 2 News. You can contact him at

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