Federal judge lauds Detroit contractor, orders probation

By Ed White

Associated Press Writer

DETROIT (AP) -- A judge sentenced a businessman to probation last Thursday for a tax crime, agreeing with his lawyer that he was a victim of a "widespread" pay-to-play culture in Detroit where money changed hands to ensure city contracts.

Karl Kado was in court for failing to report $270,000 in income for 2002 and 2003. But that crime really is secondary to his role as an FBI informant in the government's long-running investigation of corruption during the mayoral years of Kwame Kilpatrick.

In a court filing hours before the hearing, federal prosecutors said Kado has provided "extraordinary" help since 2005 by recording conversations with "corrupt subjects." They pledged that others would be charged.

Kado's company had maintenance and electrical contracts at the Cobo Center, the downtown convention center. He has acknowledged giving more than $100,000 to two Cobo Center directors but said he succumbed to their demands because his invoices otherwise wouldn't get paid.

Kado testified as part of a lawsuit last year that he also made payments to Kilpatrick and Kilpatrick's father and was a victim of extortion.

His lawyer, Christopher Andreoff, made a passionate plea for leniency last Thursday and said he hoped Kado's cooperation with the FBI will "ferret out this pay-to-play mindset."

"My client is one of those victims," he said.

U.S. District Judge Marianne Battani said she was impressed with dozens of letters written in support of Kado, a 69-year-old native of Iraq. His children -- six of the nine are doctors or in medical school -- wrote how he stressed education and how he held spelling contests after dinner.

An employee noted how Kado paid for his father's funeral. He once gave a couple an Oriental rug right off his floor.

"When I look at someone like you and what you've done with your life it counts for something," the judge said.

Prosecutors recommended no more than six months in jail. Battani ordered three years of probation and 20 hours of weekly volunteer work for a year at a Roman Catholic church in Detroit.

Pay-to-play was a "widespread operation in the city of Detroit," the judge told Kado. "In a sense, you, too, were a victim, but then you victimized by not paying your taxes."

Kilpatrick was mayor from 2002 until September 2008, when he pleaded guilty to obstruction of justice in an unrelated case in state court. He now lives in the Dallas area.

His lawyer, James Thomas, denies any extortion took place.

"This recent disclosure of direct payments to Kwame Kilpatrick was not Kado's first version and I don't believe it's going to be the last," Thomas said.

The government's biggest catch in the corruption probe has been Monica Conyers, the wife of U.S. Rep. John Conyers, D-Mich. She admitted taking bribes to support a sludge contract when she was on the Detroit City Council. She will be sentenced March 10.

The trial of her former chief of staff, Sam Riddle, recently ended in a mistrial. Two brothers who were top aides to Kilpatrick pleaded guilty to taking kickbacks in city land sales.

Published: Mon, Mar 8, 2010