The Securities and Exchange Commission charged an investment manager Monday with theft for allegedly stealing $3.1 million from the $3.4 billion Detroit Police and Fire Retirement System.
According to the complaint, filed in U.S. District Court in Detroit, Chauncey C. Mayfield, the founder, president and CEO of MayfieldGentry Realty Advisors, took $3.1 million of pension assets without authorization to purchase two strip malls in California. The complaint also charges four other MayfieldGentry executives with helping to cover up the theft.
Pending court approval, Mr. Mayfield and his firm agreed to settle the charges by paying back the $3.1 million, without admitting or denying guilt.
MayfieldGentry Realty Advisors advised the fund since 2002 but was dropped in May 2012 after the SEC complained of kickbacks to city officials related to a $117 million real estate investment trust controlled by the firm.
According to the latest SEC complaint, Mr. Mayfield took the money from a pension fund trust account in 2008, but misled pension fund officials until 2012, as the SEC prepared to file its complaint against the firm's participation in a “pay-to-play” scheme involving the city's former mayor and former treasurer. SEC officials claim the $3.1 million was used to buy the shopping centers in the name of a MayfieldGentry affiliate.
Mr. Mayfield still faces sentencing in a criminal case involving pay-to-play, for which he pleaded guilty.
Calls to the firm and its attorney, Terence Healy at Reed Smith in Washington, were not returned at press time.