How 2 Wayne County workers pulled off $1.7 million inside job

For decades, Kevin Gunn and John Gibson worked to help maintain the structural integrity of Wayne County's bridges.

What they ended up doing, however, was ruining their own integrity.

They are both now convicted criminals, admitting they used their county jobs to rob taxpayers of $1.7 million in a phony invoice scheme that involved billing the county for generators and other power equipment, which the men then sold on Facebook Marketplace and pocketed the money.

Gunn cut a deal first, then Gibson.

In U.S. District Court this week, Gibson, 54, of Detroit, pleaded guilty to conspiracy to commit federal program theft, admitting he and his supervisor embezzled nearly $2 million from a pot of money that was supposed to help repair bridges and roads. Under the terms of his plea agreement, he faces 18-24 months in prison.

Kevin Gunn, 60, of the Wayne County Department of Public Services, officially radios to open the Grosse Ile Parkway Free bridge.
Kevin Gunn, 60, of the Wayne County Department of Public Services, officially radios to open the Grosse Ile Parkway Free bridge.

His supervisor is Gunn, 64, of West Bloomfield, who pleaded guilty to the same charges in January and is awaiting sentencing.

“The alleged actions of these individuals are nothing short of disgraceful,” Wayne County Sheriff RaphaelWashington said Wednesday following Gibson's plea. “To brazenly steal from hardworking taxpayers and fraudulently line their own pockets while holding positions of public trust make these crimes all the more deplorable."

596 generators in two years

Attorneys for Gibson and Gunn were not available for comment.

Gunn and Gibson were arrested and charged two years after a Free Press investigation documented fraud and looked into Wayne County's struggles to inspect bridges, and detailed how the accuracy of dozens of inspection reports was called into question after a state review found bridge conditions did not always match inspection reports.

In the Gunn and Gibson investigation, it was excessive invoices for generators that raised red flags: The county was billed for 596 generators in less than two years, but never got or used them.

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Authorities said the pair relied on vendors to submit fraudulent invoices for the generators and other power equipment, including lawnmowers, chain saws and a backpack blower, and then sold the items online for profit.

According to court documents, here's how they pulled off their scam — for at least a few years.

On March 2, 2021, the Wayne County Sheriff’s Office received a tip regarding an unusual increase in the purchase of generators by a vendor who did business with the Bridge Unit of the Wayne County Roads Division.

How the scheme worked

Gunn, who worked for the county for 34 years, managed the Bridge Unit. Gibson, a 20-year county employee, was a foreman.

After getting the tip, the sheriff's office summoned the FBI for help — though it was the Wayne County Prosecutor’s Office that would crack the case after securing a search warrant that revealed the embezzlement scheme, which ran like this:

Gunn would approve vendors to buy generators and other power equipment from local retailers on behalf of Wayne County. The vendors would then submit invoices for these items to the county. This is where the fraud occurred.

Gunn had instructed the vendors to falsify the invoices they submitted to the Roads Division, and list the items that they were authorized to sell to the county, rather than the generators and power equipment they were actually buying at Gunn’s request. The county Roads Division would then approve and pay each vendor’s invoice.

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After the purchases were verified and approved, Gibson and Gunn sold the equipment online — though the FBI was watching, and would eventually find some of the buyers who purchased the goods.

Going undercover for the FBI

The FBI used surveillance to track the movements of those who were delivering the generators, including a former county employee who ended up cooperating with the government, and disclosed the following: He told investigators that at Gunn’s behest, he would pick up generators that were paid for by county vendors, and then resell them on Facebook Marketplace, and share the profits with Gunn.

That same employee would eventually go undercover for the FBI, which watched the man pay Gunn $4,500 in cash in marked government money.

More surveillance followed, with the FBI witnessing Gibson load generators into a Roads Division truck, drive them to a private home and unload them in a large metal shipping container in the backyard.

The FBI would eventually interview the person who bought generators from Gibson. He told agents that he had “met with Gibson on multiple occasions to buy generators, and that Gibson charged significantly less than retail value for the generators he sold.”

Surveillance would later capture Gibson selling the stolen generators to online buyers, including a Wisconsin man who told the FBI that he “had driven to Michigan on six separate occasions to meet with Gibson and purchase Honda generators and other power equipment … (and) that Gibson charged significantly less than retail value for the generators and other equipment he sold.”

During the investigation, law enforcement also got confessions from the vendors themselves, who admitted they were submitting false invoices at Gunn's behest, and added a 50% markup — all while taxpayers picked up the tab.

To date, the vendors have not been identified or charged.

Contact Tresa Baldas:

This article originally appeared on Detroit Free Press: 2nd ex-Wayne County employee pleads guilty to embezzling $1.7 million