Investigator makes case for criminal charges against Ypsi mayor in 'Chinatown' scandal

Apr 11, 2018 at 2:45 pm
click to enlarge Rendering of International Village. - Courtesy photo
Courtesy photo
Rendering of International Village.

An independent attorney hired by the Ypsilanti City Council to investigate a scandal around a proposed Chinese development is recommending the case be turned over to the prosecutor's office for further investigation and possible criminal charges.

A report released to Ypsilanti city officials and obtained by Metro Times on Wednesday afternoon suggests council turn over investigations into Ypsilanti Mayor Amanda Edmonds, former city economic development director Beth Ernat, and Troy-based real estate agent Amy Xue Foster.
The attorney, Plato Law's Ed Plato, says Edmonds and Ernat could be in violation of the state's misconduct in office law, as well as city charter articles related to ethics. He recommends possible censure for Edmonds and determines that Ernat should be fired (her contract wasn't renewed last week). Plato also recommends the city pursue felony bribery and resisting or obstructing officer in discharge of duty charges against Foster under MCL 750.117 and MCL 750.479, respectively.

But Plato's recommendation is just that — a recommendation. City council will have to decide whether to turn information over to the Washtenaw County Prosecuting Attorney Brian Mackie would have to pursue charges.

The scandal surfaced after Foster proposed in May a $300 million project she initially billed as a "Chinatown" but later rebranded as "International Village." The mixed-use development would have been built on 28 acres of vacant city-owned land called Water Street that's adjacent to downtown Ypsilanti, and it would have largely catered to wealthy Chinese students.

As part of the proposal, Foster suggested on May 23 flying city officials to Beijing later in the year to learn about Chinese culture and see the type of architecture that would be replicated in Ypsilanti. On May 24, Ypsilanti City Attorney John Barr told city officials that it would be "illegal and unethical" for them to take a trip funded by Foster, emails obtained by Metro Times show.
On Sept. 11, Ernat told city council and the public that the Wayne State University Chinese Scholar and Student Association was paying for four city officials to travel to China. That included Ernat, mayor Edmonds, police chief Tony DeGiusti, and Mayor Pro Tem Nicole Brown.

They left for the 12-day trip on Sept. 21 with other city officials and the public believing that the WSU student association paid for the trip.

A Metro Times investigation into the funding source published on Sept. 27 found that it did not. That led to an investigation into the funding source by the Ypsilanti City Council, which hired Plato's office to conduct its own independent investigation.

On Friday, Plato released his findings to city council, which Metro Times obtained through a Freedom of Information Act request. A detailed 26-page timeline of events Plato produced illuminates the lengths to which the scandal’s players — specifically, the developer and Ernat — went in order to cover up the funding source. Between airfare and other expenses, the cost is estimated at around $40,000.

It also shows how Ernat repeatedly lied under oath and misled the public in the months leading up the trip, as well as during the investigation. Though Plato doesn’t provide definitive proof that mayor Edmonds lied about her knowledge of the funding source, he casts serious doubt on her claim that she was unaware that Foster paid for the trip. He also noted that Edmonds didn't appear concerned with whether she acted appropriately.
Here are Plato's findings and recommendations for Edmonds, Ernat, and Foster, as presented in Wednesday's recommendation report.

Mayor Amanda Edmonds

In the recommendation, Plato casts doubt on Edmonds' claim that she didn't know who funded the trip, and details multiple instances that likely alerted her to the true funding source.
  • He notes that on Sept. 10 Edmonds used LinkedIn to message former WSU Chinese student association member Peifing Li to inquire about the funding source. Documents show that Li responded on Sept. 12 and informed Edmonds that one of Foster's companies paid for the trip. Edmonds claims that she didn't see the response until after she returned from the trip.

    Plato writes that that's unlikely because Edmonds was anticipating a response and receives emails on her phone. He also notes that a Sept. 13 FOIA request for emails related to the China trip obligated her to look at all her email accounts. She provided emails relating to the trip to the city's FOIA director, but claims she never checked her LinkedIn account during her search of relevant emails.

  • Plato also notes that Edmonds received a "scholarship letter" on Sept. 7 that allegedly came from the student association that announced its intent to fund her trip. But the email shows that the letter originated with Foster and didn't include any signatures from student association members. In short, it was obvious that the letters were not what Foster claimed they were.

  • Edmonds further claims that Foster told her the Chinese Consulate paid for the trip, but Foster denies that the consulate ever said it would fund the trip.

  • Finally, Plato notes that Edmonds never questioned who paid for her visa, even though she knows visas are not free.
Plato suggests council pursue several options:

Based upon our review and analysis, it is our recommendation that the city council review our investigation and findings for its own determination of whether it believes there has been a prima facie case presented for a violation of the ethical standards set forth in the Ypsilanti ordinances. However, regardless of whether or not the council believes there has been a technical violation of any ordinance, if the city council finds the mayor’s conduct to be in violation of her fiduciary duties as mayor, the council can vote to publicly censure (officially reprimand) the mayor or the council can elect to take no action at all. A public censure could include reminding the mayor of her mission for public service and an explanation of why her conduct was unacceptable and in breach of her responsibility to the public.

It is further our opinion that probable cause has been shown for a potential violation of the common law charge of “misconduct in office,” as described above, and we recommend that the City Council refer this matter to the Washtenaw County prosecutor for further review, investigation, and possible charges.

Economic development director Beth Ernat
  • Plato notes that Ernat accepted a jade bracelet from Foster in May and did not return it to her as she was instructed by city manager Darwin McClary. She claims she doesn't remember receiving those instructions from McClary.

  • Emails, texts, and documents obtained during the investigations show that Ernat drafted four "scholarship letters" that the WSU Chinese student association allegedly wrote. She never mentioned that she drafted letters while providing testimony under oath on separate occasions to city council and Plato.

  • Ernat claims that on Sept. 7 she received a copy of a check for $16,800 via text message from a student association. When Plato asked to see the check in a December interview, Ernat claimed that her phone automatically deleted text messages after 120 days. However, the interview took place less than 120 days from Sept. 7.

  • Plato points out that video evidence and bank records show that a check for the trip wasn't cut until Sept. 8. Plato adds, "There is no indication the cashier’s check was ever in the possession of the [student association]."

  • Ernat forwarded emails regarding funding to McClary. She deleted text in the forwarded emails that would indicate that Foster was funding the trip.

    Plato outlines multiple other inconsistencies in Ernat's stories:

Based on our review and investigation, it is our opinion that Economic Development Director, Beth Ernat, knew more than she revealed to the City Council and to our firm of the involvement of Amy Foster and the International Village in the funding of the China trip. Furthermore, she failed to disclose important matters such as the fact that she drafted the scholarship letter and sent it to Amy Foster for use. There are also several inconsistencies in her testimony leading to her lack of credibility. It is our opinion that Ms. Ernat either knew of the intimate involvement of Amy Foster in financing this trip to China or she turned a blind eye toward what was occurring. At best, she was negligent in carrying out her duties and, at worst, she was directly involved in assisting Amy Foster
in her actions.

It is further our opinion that probable cause has been shown for a potential violation of the common law charge of “misconduct in office”, as described above, and we recommend that the City Council refer this matter to the Washtenaw County Prosecutor for further review, investigation and possible charges.

Amy Foster and Jingmin Liang
  • Foster was repeatedly told that it would be illegal and unethical for her to fund the trip. She still funded it.

  • She and Liang developed and executed an elaborate scheme to make it appear that the WSU student group funded the trip when Foster really paid for it. We detailed that scheme and how they were caught here.

  • Liang and Foster repeatedly lied to avoid testifying and urged current and former Chinese students not to speak with Plato:
Based on our review and investigation, it is our opinion that Amy Foster deliberately ignored the warning for her or her companies to not pay for the trip to China while knowing it was unethical for her to offer or give gifts to city officials. Furthermore, she took great steps to try and prevent anyone from the City from discovering that the funding for the China trip came from the International Village account.

Then, during our investigation, Amy Foster and Jingming Liang repeatedly attempted to infringe upon and prevent our investigation from going forward.

Amy Foster’s conduct does not appear to fall within the authority
of the Board of Ethics. However, based on our investigation, the City of Ypsilanti may decide to refer this matter to the Washtenaw County Prosecutor for further review and investigation.

Potential Michigan criminal statutes that may be involved would be MCL 750.117 which provides in pertinent part:
“Any person who shall corruptly give, offer or promise to ant public officer, agent, servant or employee…..any gift, gratuity, money, property or other valuable thing, the intent or purpose of which is to influence the act, vote, opinion, decision or judgment of such public officer, agent, servant or employee ….shall be guilty of a felony.”

Furthermore, because of the interference by Ms. Foster and Jingming Liang in the ongoing investigation, MCL 750.479 may be implicated which provides:
“A person shall not knowingly and willfully do any of the following: (a)…obstruct, a ….city attorney….court officer, or other officer or duly authorized person serving or attempting to serve or execute any process, rule, or order made or issued by lawful authority or otherwise acting in the performance of his or her duties.”

Other officials

Plato is not recommending any further action against the scandal's other players:

After a thorough review of this matter, including the sworn testimony of eight individuals involved, it is our opinion that there was no evidence of any unethical conduct or breach of any fiduciary duty by City Manager, Darwin McClary, Police Chief DeGiusti, or Mayor Pro Tem, Nicole Brown. In fact, City Manager McClary was the one who initially questioned Amy Foster’s offer of a trip to China because he knew it to be inappropriate, and it was the City Manager who requested the City Attorney to issue an opinion which he immediately forwarded to Ms. Ernat, Chief DeGiusti, and the City Clerk for distribution to all members of the City Council and the Mayor.

We're seeking comment on what's next from city officials and other community members .

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