Allen Park, Mich. and Two Former City Leaders Charged with Fraud in Muni-Bond Offering for Movie Studio Project

Defendants were the City of Allen Park, Michigan, and its former mayor and city administrator. An SEC investigation found that offering documents provided to investors during the Detroit suburb’s sale of $31 million in general obligation bonds contained false and misleading statements about the scope and viability of the movie studio project as well as Allen Park’s overall financial condition and its ability to service the bond debt. The charges were settled by injunctions and bars against the individual defendants along with a $10,000 penalty assessed to mayor Burtka, and by the City’s agreement to cease-and-desist from future violations.