Original subtitles

In this episode of American Greed, Kwame killed Patrick, the youngest mayor in

the history of Detroit.

I was elected mayor at age 31 years old because I dared mighty things for the

citizens of my city. There were many people who believed that he was the next

generation of leadership.

A leader who many hope will bring the swagger back to the Motor City.

He was a hip -hop man.

He was hanging out with the athletes.

But his outrageous temptations lead to unimaginable corruption.

From the day he walked in, this was about how can I make Kwame Kilpatrick,

family and my friends richer.

The mayor had $840 ,000 in unexplained cash in his personal

bank accounts.

Why did his administration fail?

One word, greedy.

Greedy, greedy, greedy.

September 4th, 2008, before a cheering crowd in Detroit City Hall, embattled

Mayor Kwame Kilpatrick gives an emotional televised speech.

Despite the upbeat atmosphere, the mayor has a serious message to deliver.

I've often said that you have to stand strong for the city of Detroit, but

sometimes standing strong.

mean stepping down.

After a turbulent six and a half years in office, the mayor is resigning and

heading to jail.

Earlier that day, he pleaded guilty to two felony counts of obstructing justice

after lying under oath during a police whistleblower trial.

Amazing. And it was a huge story, and it was amazing. It was historic.

Despite facing 120 days in jail and $1 million in restitution, Kilpatrick's

is anything but defeatist. We fall, but this city always

gets up.

I want to tell you, Detroit, that you done set me up for a comeback.

And so even right down to the end, even after being sentenced to jail, it was

hard not to believe him.

He continued to rebound from everything that was ever thrown at him.

But there will be no comeback this time.

The worst is yet to come.

Over the next few years, the mayor will be at the center of one of the largest

municipal corruption probes in U .S. history, in which the government accuses

him of running the city like a crime boss.

But this wasn't supposed to be the script for Kwame Kilpatrick.

He was supposed to be different.

The native son destined to turn around his faltering Rust Belt city. The hip

-hop mayor who would provide a new model of what a public official could be.

He was Barack Obama before Barack Obama knew who he was.

He knew how to talk to people.

He had it going on.

Adolph Mongo is a veteran political consultant and one -time aide to former

Detroit Mayor Coleman Young.

He's known the Kilpatrick family for decades.

Oh, they had a great name, you know.

Lots of years in the political circles had a lot of influence.

Kwame is the son of Carolyn Cheeks Kilpatrick, a former Michigan State

Representative and future seven -term U .S. Congresswoman.

His father is Bernard Kilpatrick, a former Wayne County Commissioner and

broker in the region's Democratic machine.

He was sheltered.

His mother and father took care of him. They were divorced.

He went to Florida A &M, played football.

In 1996, just four years after earning a degree in political science, Kwame

enters the family business.

He wins a seat in the Michigan State Legislature and quickly makes a name for

himself.

I had a leadership post in the Democratic Party. I had charisma.

So, yeah, he was a good state rep.

While the young legislator thrives in Lansing, his hometown is in Faring as

well. During the 1990s, nearly 80 ,000 residents leave Detroit.

By 2001, unemployment is at 10 % and rising.

Clinton had a successful eight years in office. These were some great times in

the city of Detroit.

did not benefit from it. And people was looking for somebody new. They was

looking for fresh, a fresh face, somebody young.

In the run -up to the 2001 mayor's election, a group of Detroit

African American Men's Organization, or AMO, is conducting a search for a

candidate to represent their interests.

The Kilpatrick men are members of that group.

Well, this is, if you look in the back, the innocent Kwame Kilpatrick.

Larry Mongo is the older brother of Adolph Mongo and a founding member of

Every Friday or Wednesday, twice a week, we all met.

And most of these men were self -made men or high political positions.

But then we said, why not get us a young John F. Kennedy?

Why not get us a young black guy, post -silver rights?

That's our person.

Larry says that during one of Ammo's weekly meetings, Kwame Kilpatrick tells

group that he recently received a sign.

During a prayer session, Kwame says he opened up his Bible and landed on the

story of David, who was anointed king of Israel at the age of 30.

He says, so I'll tell y 'all I would run.

And here's a young black guy talking about the Bible.

We think it's superstitious.

You go against a good kid like that.

So we did.

We said, okay, Kwame, you did.

Kilpatrick's youth makes him a long shot in the race.

But with his good name, his natural charm, and the financial support of

has a fighting chance.

We put up all this money.

We knew we controlled the streets.

We knew we controlled the right preachers.

Kevin Dietz is an investigative reporter with WDIV in Detroit.

At first, nobody thought Kilpatrick had a chance, but he just wowed the crowd

everywhere he went. He just had this charisma about him.

We want our citizens to go to the ballot box and decide whether they want to

move forward or they want to stay in the mud.

In an upset, Kwame wins the election, becoming the youngest mayor in the

history at just 31 years of age.

We were excited about this young new mayor who was going to come in and make

Detroit different.

But during that night's celebration, Larry Mongo says the new mayor makes a

curious statement.

When he got elected mayor, I swear to you, he approached me there, Mr. Mongo.

said, well, I don't want to go to jail.

And I laughed and I said, man, I said, the last thing you have to worry about

going to jail.

The men laugh off the exchange, but it would ultimately be prophetic.

Next on American Greed, the young mayor learns how to turn power into money.

I think Kilpatrick felt like he was loyal.

King Kwame.

And as the king of the city of Detroit, he was never going to spend a penny.

Detroit, 2002.

Shortly after taking office, new mayor Kwame Kilpatrick has residents of the

city feeling good once again.

How you doing?

Congratulations. Thank you so much. I know you're going to take care of him.

Thank you. The big man has big plans.

Demolishing abandoned buildings, revitalizing neighborhoods, and bringing

business back to the Motor City.

It's so likable. You just...

are certain that he's going to be able to get the attention of Washington and

get dollars brought into Detroit, get business to invest in the city.

So Patrick embodied the best and the brightest of what Detroit had produced.

Sheila Cockrell is a member of the Detroit City Council.

She is impressed by the new mayor's enthusiasm.

They had put together this strategic management center.

I mean, it was really good ideas, good, rock -solid public policy stuff.

Though he has good ideas, the new mayor relies on a questionable group to carry

out his vision.

Kilpatrick's administration is stacked with friends and family, including old

high school pals Christine Beattie as his chief of staff and Derek Miller as

chief administrative officer.

The friends and family plan.

was big.

He hired dozens of people, appointed them. They got the best jobs, and they

the most money to do them.

Bernard Kilpatrick, the mayor's father, also plays a role in the city's

operations.

Shortly before his son takes office, Bernard sets up a new consulting firm,

Maestro Associates.

What is a maestro?

You see?

In other words, he told everybody, I'm in charge.

You wanted something done, you had to go to...

Bernard, the consultant maestro.

Maestro pre -approve it, then you will meet with the son.

Despite the red flags, the Kilpatrick administration is off to a roaring

The mayor's big plans and even bigger personality make him a local celebrity.

How y 'all doing today? All right. How are you? How's everything?

I saw you sneaking a picture. You guys just said, hey.

He felt that he was just.

Bigger than life. He was believing his own press that he was just the greatest

thing ever.

It's not uncommon to see the mayor flaunt his newfound status around town.

He was going to these clubs, hung out with all the football players coming

You can see him at the games. You can see him everywhere.

When he went out to dinner, he'd get up and walk out of the restaurant without

paying the bill.

He'd say, well, why would I pay the bill? I'm the mayor.

He would take eight, ten bodyguards.

Everywhere he went. But it was about the show.

It was about being Kwame Kilpatrick. But the mayor's celebrity lifestyle would

soon catch up with him.

In September 2002, Detroit political circles are abuzz about a rumored wild

party at the Mnookian Mansion, the mayor's taxpayer -funded residence.

The rumor was that Kwame Kilpatrick's wife found out about this party and

over to it.

According to the stories, which have reached legendary status in Detroit, the

mayor's wife assaulted a stripper after catching her husband getting a lap

dance. Police were called, and EMS were called, and the party broke up.

And then everything just disappeared.

No paperwork, no witnesses, no people.

No one can prove the party or assault actually happened, but the story dogs

Kilpatrick for months.

The Mnookin Mansion is not a party house.

What are you guys doing? The rumors were persistent. They just kept coming and

coming and coming. The following spring, one of the mayor's bodyguards, Officer

Harold Neltrup, makes a report that eventually reaches the head of internal

affairs, Deputy Police Chief Gary Brown.

He made a report indicating there may have been a party. And Gary Brown was

looking into that report, which was his job. When Kilpatrick found out, he went

crazy. He got so angry.

In May 2003, Brown and Nelthorpe are removed from their jobs.

A month later, the officers sue the mayor and the city, saying their job

violated the Whistleblower Protection Act.

It was an utter abuse of power, and it therefore fed the notion that there was

cover -up.

Up next, trouble's brewing, but King Kwame finds creative new ways to rule

kingdom. He's using petty cash.

To buy gifts for his friends. This is the city petty cash fund.

Despite the rumors surrounding the raucous Manoogian mansion party, Kwame

Kilpatrick's national profile is on the rise.

In 2004, the dynamic young mayor speaks at the Democratic National Convention in

Boston. I stand before you tonight as an African -American man, a husband

and father of three beautiful children.

He wowed the crowd.

He had a spotlight.

We do stand for the values of this country. Strong families, healthy

communities, personal and civic responsibility.

and a commitment to volunteerism and service.

People were talking about Kwame Kilpatrick in the same breath as Barack

and who would rise nationally first.

But back in Detroit, Kwame's behavior is less than inspiring.

The mayor is using the city's credit cards and the petty cash fund to finance

his over -the -top lifestyle.

If he wanted tickets to the Rolling Stone concert, well, I don't want to pay

with my own money for that. I'll go to petty cash.

Go on a vacation?

Let's use the city credit card.

Concerns were starting to emerge inside City Hall on the use of the city's

credit card. You know, who was flying where?

You know, using the city credit card for what purposes?

But Kilpatrick's financial indiscretions run much deeper than dipping into petty

cash.

Over the past five years, the mayor has been abusing his nonprofit organization,

the Kilpatrick Civic Fund.

In 1999, as a state legislator, Kwame founded the fund to help underprivileged

youths and promote voter education.

But that's not where all the money goes.

So the Kilpatrick Civic Fund is a fund for kids of Detroit.

And kids of Detroit used it, Kwame's kids.

They went to summer camp with the Kilpatrick Fund money.

He used it on a...

traveled for his family to lavish resorts and spa vacations. He used it

new set of golf clubs. The list goes on and on. Robert Beckman is a special

agent with the FBI.

The Bureau begins investigating Kilpatrick when it's clear that his

crossed the line.

Inside the FBI by 2004, we had some concrete information that he was

committing crimes.

The FBI discovers the Civic Fund is being replenished in a troubling way.

The mayor and his fundraisers routinely hit up contractors and anyone else

wanting to do business in the city.

If you were a contractor, you'd get a letter in the mail saying...

This is the Kilpatrick Civic Fund. We'd like you to give us a donation.

In this letter obtained by American Greed, donations of up to $10 ,000 are

strongly suggested.

Emma Bell is one of the mayor's fundraisers. The FBI learns that she has

routine when it comes to the donations.

She would take it to her bank, cash their check, take out money in cash

in amounts of $10 ,000 or less.

then go meet the mayor in a special little room that he had in his suite of

offices. The mayor calls it his barbershop room.

He had a barber chair installed in this small office. They'd shut the door, she

would reach into her bra and pull out the cash and hand it to the mayor. The

mayor's birthday party also serves as a potent fundraiser.

The guy stood up at the front of the party and said, it's Kwame Kilpatrick's

birthday, we're passing the hat. I'm starting with $5 ,000.

What are you going to give?

And they'd pass this around the party with hundreds and hundreds of

there.

Contractors step up their game to stay in Kwame's good graces.

They take the mayor on shopping sprees, pay for his custom suits, and provide

him with courtside seats to the NBA finals.

One contractor, Anthony Suave, with Inland Waters Pollution Control, even

the mayor his private jet.

The mayor would send...

to Mr. Suave and say, well, the mayor needs a jet to go to the Bahamas or to

Florida.

And they traveled in style at Mr. Suave's expense.

Kilpatrick is raking in cash, but how much longer can he keep it up?

Next on American Greed, an incident from the past threatens to derail the

mayor's schemes when the police whistleblower trial goes to court.

Kilpatrick came on and said, we're going to fight this.

And then he found out that they had the text messages.

There was a thread all the way through the text messages about how they planned

it, how they executed it, and what they did to cover that.

It's 2005 in Detroit, Michigan, an election year.

Despite the mayor's likable personality,

Ethical questions surround the Kilpatrick administration.

His chances of re -election are slim.

Reality hadn't struck this guy until he looked at these polling numbers and

said, you're not going to be the mayor anymore.

So he was in a panic.

One day I get a call at late at night.

A few weeks before the election, the mayor reaches out to political

Adolph Mongo.

I think he's been drinking.

Because his voice was so weird. He was like, Goff, do what you do.

Mongo unleashes a barrage of negative ads.

The most infamous, the so -called lynching ad.

It stops you in your tracks.

It's a picture of a lyncher.

And it says that the media is lynching Kwame Kilpatrick by reporting stories

that aren't true.

A little over the top, but that's the only way you get people's attention.

You should have seen the first draft of the ad. It was worse than what it could

ever be. And it made everybody stop and pause.

And well, do we believe the media or do we believe the mayor?

The campaign works and the mayor is again victorious on election night.

And he wins at the end.

It was really unbelievable to people who watch politics in this area.

For his efforts, Mongo is paid hundreds of thousands of dollars, a chunk of

which comes from the Kilpatrick Civic Fund.

He's the mayor of Detroit.

Why don't he say where you get the money from?

The Civic Fund was for voter education.

Now I'm a political consultant, so I had no issue with getting paid out of the

Civic Fund.

With the mayor back in office for another term, the feds dig deeper into

workings of City Hall.

The findings are shocking.

Since the beginning of his administration, the FBI says the mayor

lucrative pay -for -play scam involving the city water department.

The Detroit Water and Sewerage Department is owned by the city of

it provides water and sewerage services to an area in all of southeast Michigan,

so the city itself can be broke and there can still be a surplus of money in

DWSD.

The Water Department has more than $1 billion available for contract work.

Conveniently, the mayor of Detroit is the special administrator over the DWSD,

giving him unchecked power to approve contracts.

The pieces were there. He had much more power with water contracts than he did

in other areas of city government.

Bobby Ferguson is a friend of the mayor and the owner of several construction

businesses.

The FBI says Kilpatrick and his cronies instruct larger firms to make Ferguson a

minority subcontractor on city projects.

Sometimes Bobby Ferguson would approach contractors on his own. He would show up

and say, I need a piece of that contract.

In other cases, other city officials were instructed that they needed to find

way to include Ferguson in whatever contracts they did.

Rather than lose millions of dollars in work, the contractors often comply.

In February 2003, the firm Walbridge Aldinger puts in a bid to construct a

water treatment facility.

The mayor's right -hand man, Derek Miller, informs Walbridge that they need

include Ferguson.

So at the last minute, Walbridge Aldinger entered into a handwritten...

addendum to their contract that they intend to give $10 million of the

to Bobby Ferguson. And the fact that that was a handwritten amendment to a

million contract is unheard of.

The story is the same for many other contractors who give Ferguson millions

dollars in city work. Some choose to pay him for doing nothing at all.

They said, let's just give you a million dollars because we don't want you on

the project.

We can do a better job without you here. So just take the money.

On top of the Ferguson business, many contractors pay consultant fees to

associates. If Bernard Kilpatrick came and knocked on your door and suggested

that you hired him, there was always the implied reality that if you didn't pay

him, somebody else would.

In August 2007, an episode from the mayor's past once again rears its head.

As the police whistleblower case finally goes to court, it's been four long

years since the mayor supposedly threw a wild party at the Manoogian Mansion.

These officers had said that they were demoted for investigating this Manoogian

Mansion party.

And by this time, the public had said there was no party.

This is ridiculous.

If there was a party, it would have been proven by now.

During the trial, Kilpatrick takes the stand.

The cop's attorney grills the mayor about his extramarital behavior.

He asks him if he's ever had any affairs, particularly with his chief of

He gets on the stand, and they start asking him questions about having a

relationship, a sexual relationship with Christine Beatty.

He's like, no, absolutely not.

You're under oath, Mr. Mayor.

Absolutely not.

We have nothing to hide.

We have been totally up front.

Christine Beattie gets the same line of questioning.

The pair also deny involvement in Gary

Brown's firing.

He was not fired. As a matter of fact, as mayor, I can't fire a civil servant.

But the jury doesn't agree.

After three weeks of testimony, the court sides with the cops.

The city of Detroit ultimately agrees to pay the officers $8 million as part of

the settlement.

That's money the city of Detroit needed.

The city of Detroit did not have an extra penny.

But just when the city thinks the incident is behind them, the Detroit

Press drops a bombshell.

In January 2008, the newspaper publishes text messages from the mayor's city

-issued pager.

The texts tell a much different story than the one Kilpatrick and Beattie told

in court.

Absolutely crazy.

Just crazy.

He said he did not have an affair with Christine Beattie under oath.

And these text messages show that he didn't.

He lied under oath. The texts also show that the pair did indeed conspire

against the deputy police chief.

Beatty texts the mayor, I'm sorry that we are going through this mess because

a decision that we made to fire Gary Brown.

By this time, it was clear to me that this was a group of people that

didn't believe the law applied to them. They were above the rules.

Christine Beatty resigns as the mayor's chief of staff.

She's given a $150 ,000 parachute, the bulk of it from the Kilpatrick Civic

Fund.

On January 30th, the mayor, with his wife by his side, makes a televised

appearance from inside his church.

I want to start tonight by saying to the citizens of this great city, I'm sorry

for the embarrassment and the disappointment the events of the past

have caused you.

The mayor apologizes but refuses to resign.

Let me be clear tonight.

I would never quit on you.

Ever. But there's just some things you can't talk your way out of.

Kim Worthy, the Wayne County prosecutor, announces that she will investigate

perjury charges against the mayor.

Everything kind of just blew wide open. This was something that we could not

ignore.

Up next, the mayor takes a fall.

He goes to jail for perjury. He should have been on the dumbest criminal show.

That's dumb.

Damn.

After the highly publicized events of the sex and text scandal, Detroit Mayor

Kwame Kilpatrick is on the ropes.

In March 2008, the city council takes a non -binding vote urging the mayor to

resign.

Seven yeas, one nay.

Councilwoman Sheila Cockrell says the mayor's antics are a disruptive

distraction. By this time now, just massive financial collapse

that was really happening, that the government should have been consumed

the crisis. You couldn't get all this other garbage over here that was still

being dealt with.

At the Wayne County prosecutor's office, Kim Worthy and her staff poured over

thousands of text messages.

They quickly discovered how deep the rot runs in City Hall.

It was an insight into how they did business in that administration, how

most of the things that they did were not for the good of the city. It was for

the good of themselves first.

On March 24th, Worthy announces a 12 -count criminal indictment against

Kilpatrick and Beattie.

The mayor is charged with eight felonies, including perjury and

justice. It is perjury if there is lying, and perjury is a crime.

I felt that he should no longer be the mayor of Detroit, that he had to step

down. That was a non -negotiable condition.

We certainly take no joy or pleasure in announcing these charges.

But it would be much sadder still if true justice were ignored.

But the mayor won't budge. He refuses to resign and vows to fight the charges.

Mayor, do you think you'll go to jail for covering up the perjury?

I think Kilpatrick thought maybe the public would say, why are you charging

guy for this lie? Everybody lies about affairs.

But Kim Worthy wasn't backing down.

She was sticking with it. No matter how unpopular an opinion, and this was very

unpopular at the time, we had to do what we thought was right.

On September 4, 2008, after months of increased scrutiny, Kilpatrick pleads

guilty to two felony charges.

Christine Beattie eventually does the same.

As part of his plea deal, the mayor must resign from office, serve 120 days in

the county jail, and pay a restitution of $1 million.

Yeah, it was shocking, but, yeah, it's sad.

You don't want to see people go to jail, but, you know, it is what it is. The

mayor steps in front of the cameras to make the announcement public.

responsibility for my own action.

I wish with all my heart that we could turn back the hands of time and tell

young man to make better choices.

While the mayor is down, he vows he's not out.

I want to tell you Detroit that you done set me up for a comeback.

And this is literally where you begin to take the view, is there a personality

disorder at play here? I mean, how can you actually really believe that you're

setting yourself up for this comeback?

With Kilpatrick's criminal enterprise crumbling, the FBI says Bobby Ferguson

attends to some last minute financial matters.

The day before the mayor leaves office.

The feds say Ferguson goes to the bank and cashes out a $1 .1 million

certificate of deposit.

Towards the end of his administration, they were scrambling, and Ferguson was

cashing money, and there was a concerted effort to make money at the last

minute. For the next three months, Kwame Kilpatrick trades his office in City

Hall for a cramped cell in the Wayne County Jail.

On February 3rd, 2009, after serving just 99 days, he's released for good

behavior. He immediately boards a private plane and flies to Texas, where

allowed to complete his probation.

People were like, let's close the terrible chapter and let's move forward.

can finally stop talking about Kwame Kilpatrick.

While in Texas, the former mayor takes a sales job with a subsidiary of the

Detroit -based company CompuWare.

As an account executive, the former mayor makes a base salary of $120 ,000,

the potential for much more.

People who do that job and do it well, we're making $300 ,000, $400 ,000 a

But after just a few weeks on the job, Kilpatrick claims he's unable to make

monthly $6 ,000 restitution payment.

Kilpatrick wrote the judge a letter that said, after I pay all my bills, I only

have $6 a month to pay towards restitution.

And the judge is like, what are you talking about?

If you would have wrote this script and took it to Hollywood, they would have

threw it away at you.

No one is that dumb. It can't happen.

The judge denies the request.

WDIV reporter Kevin Dietz grabs a camera crew and heads down to Texas to

investigate Kilpatrick's claims of hardship.

He's amazed at what he finds.

He is living in a mansion much bigger than the Manuga mansion.

He is living in a beautiful home in a gated community in South Lake, Texas.

And he's rolling in an Escalade.

And we follow him around with hidden cameras, and he's eating at nice

restaurants. He's living large down in Texas.

Kim Worthy is not amused. Her office immediately looks into Kilpatrick's

newfound luxury lifestyle.

When we dug further, we even found out there was much more money that was

around and changing hands and changing accounts and et cetera. So it was even a

lot worse than we had anticipated.

Kilpatrick must return to Detroit for a series of restitution hearings.

And now the judge is asking questions.

How are you paying for this stuff?

I don't know.

How much is your rent? I don't know.

My wife pays all the bills.

Where are you getting this money? I don't know.

After intense questioning, Kilpatrick eventually reveals where some of his

is coming from.

And Kilpatrick then tells the courtroom and the judge that he was given a huge

amount of money.

by several businessmen in Detroit to resign and leave town.

The four businessmen are heavy hitters. Peter Carmonos of CompuAir, Dan Gilbert

of Quicken Loans, Jim Nicholson of PVS Chemicals, and auto racing mogul Roger

Penske. He snitched on some of the top leaders who tried to help him. This was

in the street. Kwame wouldn't even be here today.

The businessmen say they loaned Kilpatrick $240 ,000 to persuade him to

Detroit. What they said was that Kilpatrick would not resign.

And the city was crippled.

The city couldn't do any business.

And so they said, we need you to resign.

We need you to move on. I think the businessmen were doing what they thought

in the best interest of the city. My position was never that they broke the

in any way.

For lying about his finances, the judge puts the former mayor back behind bars.

The judge had had it.

And he sent him away for 18 months.

18 months is a lot different than 99 days.

Next on American Greed.

Just when it seems Kwame's legal troubles can't get any worse, the feds

hammer. Southeast Michigan got...

A ringside seat, and they could see exactly the depth of the corruption, how

many people were affected, and how sinister the plots were here.

For more than eight years, residents of Detroit have heard countless tales about

the misdeeds of Kwame Kilpatrick.

But by the summer of 2010, the city would learn just how bad things really

On June 23rd, after a six -year investigation, a federal grand jury

Kilpatrick on 19 counts of fraud relating to the Civic Fund.

We had more than enough evidence. That was a mail fraud and wire fraud in a tax

fraud conspiracy.

It was very gratifying to be able to reveal that to the world.

Between 2003 and 2008, the government says the mayor received more than $640

,000 in unreported taxable income.

Anytime he needed money, he'd go to the civic fund.

It was a bank account that he had access to, and he would direct an underling

that worked for him to simply write him checks. In December 2010, a second

indictment drops.

charging Kilpatrick, his father Bernard, Bobby Ferguson, and Derek Miller with

racketeering. The indictment says the men turned the mayor's office into a

criminal enterprise to enrich themselves, their families, and their

They have many different schemes where they're making money off of and

off of.

That is the essence of a RICO conspiracy.

In September 2012, the federal case finally goes to trial.

It was crazy.

You know, everywhere Kilpatrick went, you know, cameras followed him. You

you'd think it was the biggest celebrity in the country.

Over the next five months, prosecutors called 80 witnesses.

In a surprise turn of events, the mayor's former chief administrator and

school friend Derek Miller flips as part of a plea deal.

Miller is a wealth of information regarding the inner workings at City

It doesn't get any better than that, to have an actual member of the conspiracy

who can testify, I was there, and this is the way it happened, and we were

directing contracts to Bobby Ferguson.

Miller tells the court how he used to personally deliver bribes to the mayor

how the group would rig the contract bidding process.

They actually had meetings where they were talking together about making

for Bernard Kilpatrick and for Bobby Ferguson.

FBI agents testify that Kwame Kilpatrick had $840 ,000 of unexplained cash

deposits in his personal bank account.

He's a W -2 wage earner. There's no reason to have piles of unexplained cash

your bank account that way. They also found massive stacks of cash in safes

lockboxes at Bobby Ferguson's home and businesses.

The feds say one was packed with $275 ,000 in cash and another $500 ,000 in

cashier's checks.

When you start finding a million dollars in this place, hundreds of thousands of

dollars in cashier's checks in another place, yeah, you got some problems.

The government alleges that cash often flows freely from Ferguson to

Once again, text messages are the former mayor's undoing.

There's one particular text message where Ferguson sends a text message to

mayor and tells him, go in my safe and get $7 ,500 out of it.

Contractors testify to being extorted by the mayor and his pals.

Some cooperate in return for reduced charges for their own misdeeds.

There were some witnesses who paid bribes. There were people who were...

Pure extortion victims who came in and testified they were threatened, and

that's why they paid.

There were other people who were both.

Michael Ratai is Bobby Ferguson's defense attorney.

According to him, many of the contractors got off too easy.

You've got contractors out there that were complicit in this entire, I mean,

you want to call it a criminal enterprise, they were absolutely

made hundreds of millions of dollars, and they got a free pass.

The government calculates that Ferguson received $73 million in extorted city

contracts. It's unknown how much of that cash made its way to the mayor.

There's absolutely no way to say exactly how much money was paid.

But as far as contracts that got extorted and that shouldn't have gone to

Ferguson but for criminal activity, the answer is $73 million.

After six long months, the jury reaches a verdict. On March 11, 2013, Kwame

Kilpatrick is found guilty.

Convicted on 24 of the 30 counts against him, including racketeering, extortion,

mail, and tax fraud, he's sentenced to 28 years in prison.

This guy who was so charismatic, who could have been the mayor of Detroit

forever, is now going to go.

Sit in a prison for 28 years. What a waste. What a shame.

Bobby Ferguson is found guilty on nine counts of racketeering, extortion, and

bribery. He gets 21 years.

I think the judge felt that Bobby Ferguson was instrumental in this, that

Bobby had the ideas and got Kwame to go along.

Outrageous. Nobody in the United States has ever received... a sentence of that

magnitude, not having been a public official.

And then there's the maestro, 72 -year -old Bernard Kilpatrick.

He's found guilty of filing a false tax return and gets 15 months in prison.

I went to his sentencing and was just disappointed.

I think he should be doing the time his son is doing.

In total, the investigation snags convictions on 34 individuals, including

Bell, who receives two years probation for tax evasion.

I think the important thing in this case is, out of all the people that we've

charged, 100 % of them have been convicted.

There were no acquittals of anybody.

But it's no victory for Detroit.

On July 18, 2013, the city files for Chapter 9 bankruptcy.

With debts of nearly $20 billion, it's the largest municipal bankruptcy filing

in U .S. history.

While the corrupt regime of Kwame Kilpatrick didn't cause the city's

many say that he failed to do anything to stop it.

He did not cause the bankruptcy, but by not paying attention.

I mean, you can't be running a criminal enterprise and dealing with the city's

financial collapse simultaneously.

Even if you're talking $10, $20, $50 million in stolen money, it's nothing in

the bankruptcy.

But it's the perception that Detroit is dirty.

So who's going to come and invest in Detroit?

The man who many residents thought was going to be the key to revving Detroit's

revival instead helped drive it over the financial cliff.

And I'm not saying he would have been Barack Obama, but who knows?

He could have taken a city that was hopeless and brought it back.

He used his powers to figure out how to steal and how to collect as much money

for him and his friends and his family as he could. He just crushed.

The city that he says he loves.

And he ruined his life in the process.

Kingpins, smugglers, murderers, and money men go inside the blood -drenched

business of drug trafficking.

Cocaine Cowboys, next on CNBC.