Up To $40 Million Allegedly Embezzled From Detroit Riverfront Nonprofit

Detroit has endured its fair share of scandals over the years, and a new entry may soon be added to that list.

What Happened: An embezzling scheme reportedly hit the Detroit Riverfront Conservancy, a nationally known nonprofit credited with the revitalization of the land along the Detroit River.

The conservancy placed CFO William A. Smith on leave in May; the ongoing investigation was reportedly delegated to the Federal Bureau of Investigation.

“The investigation includes allegations of falsifying bank records, securing loans and pocketing the proceeds and investing in private, for-profit limited partnerships — for more than a decade,” the report said.

According to the Detroit News, citing anonymous sources, $40 million is an upper-end estimate of the embezzled amount. The total exposure will be announced pending the end of the FBI’s investigation.

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Why it Matters: The Conservancy helped raise funds for Detroit’s Riverwalk project. The Riverwalk, which extends from the Ambassador Bridge connecting the U.S. and Canada to the MacArthur Bridge and Belle Isle, is a centerpiece of the city’s attempted recovery.

The scandal comes amid greater uncertainty regarding the future of Detroit’s downtown. While investors poured billions into development efforts, commercial real estate has struggled.

Ford Motor Co has spent millions renovating the previously abandoned Michigan Central Station as an operations center. The century-plus-old building, located in Corktown, is located less than a mile from downtown Detroit.

Developer Dan Gilbert‘s ongoing construction of a skyscraper at the former location of Hudson’s will become the second-tallest in the city. The tallest, the Renaissance Center, will lose its main tenant General Motors Co. GM will move to the Hudson’s location.

The Riverwalk, a half-mile walk from Benzinga’s headquarters in downtown Detroit, was named the best in the U.S. by a 2023 USA Today poll.

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