Michigan CEO frauds $240,000, initiated to help poor children and families
According to a criminal complaint unsealed in court, a Michigan CEO spent $240,000 on his lavish lifestyle, which was originally intended to help the poor. His lavish lifestyle included resort trips to Florida, a new roof over his $700,000 house, a shopping spree, and Lululemon athletic wear.
John R. Lynch,56-year old, who is a CFO and CEO at Holy Cross Organization, a non-profit organization that receives government funding, and helps provide financial support to the disadvantaged children and families across Michigan, has allegedly abused his position in order to help his family, friends and himself.
The state alleges that Lynch used his job to upgrade his lifestyle, and he pulled off his plot by paying businesses which were shown as his relative’s but in reality it was all owned by him.
In 2017, Lynch came into the federal government’s radar when an employee at Holy Cross noticed him using his Holy Cross American Express corporate card, to pay off his personal expenses. Later, an investigation followed and auditors discovered that Lynch had used $36,500 off his corporate card for his personal expenses.
The FBI affidavit says that Lynch had written various checks to business entities, none of which involved the Holy Cross organization.
Lynch has diverted the money to his secret-operated consultancy firm and a security services business, as per court. Holy Cross had hired this security service firm, unknown of Lynch secretly controlled the firm, to work at Samaritan Centre on Detroit’s east side without any bidding process.
He is charged with money and mail fraud- carrying 20-year maximum imprisonment – stealing from an organization that receives federal funding – a 10-year felony. He appeared before the court on Thursday and was released on a $10,000 unsecured bond.