Former Michigan House Aide Accused of Embezzling Over $820,000 in State Grant Money for Clare Health Park

Prosecutors Say Former Legislative Aide Used State Grant to Pay Personal Vehicle Loans, Buy Precious Metals

LANSING — A former Michigan House aide accused of embezzling over $820,000 from a state grant intended for a health park in Clare is facing a critical legal crossroads as a judge decides whether there is enough evidence to send the case to trial.

David Coker Jr., a Clare businessman who had served as an aide to Republican former House Speaker Jason Wentworth, is charged with misusing grant money to pay off personal vehicle loans, purchase precious metals, and buy land, according to court testimony in Lansing.

"He enriched himself in the process," Assistant Attorney General Kelli Megyesi said Wednesday during a hearing to determine if Coker should be tried on multiple felony counts.

Coker has pleaded not guilty to the charges. His attorney contends the nonprofit approved payments to a consulting firm that Coker owned.

The $25 Million Earmark and $9.9 Million Grant

The charged counts stem from a $25 million state budget earmark for a health park project in Clare, sponsored by Wentworth in the fiscal year 2023 state budget.

Two days after Bridge Michigan first asked about the grant in May 2023, the state said it had paused all spending amid "red flags."

On January 9, 2023, the state wired nearly $10 million to the Complete Health Park nonprofit. In the following week, Coker allegedly transferred over $71,000 of the grant money to pay off three vehicle loans and spent another $77,000 at a car dealership through a consulting firm he owned, according to court testimony.

Prosecutors also allege Coker spent nearly $200,000 on land along M-10 in Farwell using grant funds.

Prosecution Says Coker Controlled Hundreds of Thousands in Grant Money

Assistant Attorney General Megyesi testified that Coker controlled more than $820,000 of the roughly $9.9 million the state sent to Complete Health Park on January 9, 2023.

"He ran all the meetings of the nonprofit that received the grant and approved his consulting fees," Megyesi said, alleging he had purposely appointed board members with limited knowledge of financial matters and pushed an agenda that benefited him.

A state forensic accountant testified that Coker spent some of the roughly $820,000 in consulting fees his business secured on car payments, gold and rare coins, as well as land in Farwell in rural Clare County.

Alex Ungren, a forensic accountant for the state attorney general's office, said Coker's purchases were made after roughly $300,000 was withdrawn from a bank account for IW Consulting, Coker's limited liability company, and deposited into a personal bank account belonging to Coker and his wife.

Ungren testified that Coker spent more than $10,000 at a bullion store and about $15,000 at a rare coin store from his personal bank account.

After Coker was initially charged last May, Nessel's office said it seized several silver bars from Coker's home that ranged in weight from 10 ounces to 100 ounces, platinum bars, silver bullets, and American Eagle buffalo and gold proof coins.

Defense Argues Contract Was Transparent and Approved

Defense attorney Josh Blanchard argued that Coker's spending was immaterial because the health park's nonprofit board had approved a contract with Coker's consulting firm, IW Consulting, that paid him 7% of the project's cost.

"I don't see how it can be embezzlement when the principal knew of the transfer and signed a contract saying we will make that payment," Blanchard told the judge.

Blanchard said Coker acknowledged his involvement with IW Consulting when asked about it by the Michigan Department of Health and Human Services and the board was well aware of Coker's involvement with the consulting firm when they approved a contract between Complete Health Park and IW Consulting.

"There never was an attempt by Mr. Coker to hide his role with IW Consulting. The health park board knew about it," Blanchard said.

When Harden ultimately did ask for the contract between IW Consulting and the nonprofit, Coker gave it to him, according to Blanchard.

"There are no secrets about it. He was never asked about it by HHS," Blanchard said.

Grant Administrator Admits He Never Asked About Consulting Arrangement

Darrell Harden, a state Department of Health and Human Services grant administrator assigned to shepherd the Complete Health Park grant, testified that Coker told him that he "was not making any money on the project."

However, prosecutors noted the grant agreement with the state says it was the duty of Complete Health Park to "immediately notify" the state of any conflicts of interest.

Megyesi said the conflict was clear — that Coker, who drafted and signed invoices for IW Consulting on behalf of the Complete Health Park, wore too many hats.

"He ran all the meetings of the nonprofit that received the grant and approved his consulting fees," Megyesi said, alleging he had purposely appointed board members with limited knowledge of financial matters and pushed an agenda that benefited him.

Salary Cap Allegedly Violated

Ungren also noted that the contract contained provisions barring Coker, as an employee of Complete Health Park, from earning more than the state's executive level II pay — about $212,000.

The $300,000 transfer alone would have eclipsed that, the attorney general's office noted.

But Blanchard argued Coker wasn't an employee of Complete Health Park; instead, he was a contractor to the organization not subject to the salary cap.

Accounting Report Signed By Acquaintance

Shannon Taylor, a local Clare accountant who signed off on Complete Health Park's initial financial status report to the state in December 2022, told the judge that she "was far too trusting and didn't ask a lot of questions."

Taylor said she had been approached by Coker, who was an acquaintance in Clare, to help with accounting for the health park project.

She said she ultimately declined in January 2023 because she felt she didn't have the experience needed, working more with payroll and bookkeeping than with financial statements and larger business operations.

Still, she said, she signed off on a financial status report in December 2022 as a "placeholder" until the company found an official, permanent accountant.

"I just trusted that this was how these things worked in order to move forward; for the project to even be real or possible, then figures had to be turned in saying what they were going to be," Taylor said.

She said she hadn't actually reviewed the report but understood it to be a projection of how the project dollars may be spent.

"I didn't ask a lot of questions because I didn't know the questions to ask because this is way out of my league," Taylor said.

Upcoming Decision on Whether Case Goes to Trial

Lansing 54-A District Court Judge Kristen D. Simmons said she'll make her decision on whether Coker should go on trial on May 7.

Coker was charged by Attorney General Dana Nessel's office last May with seven counts in relation to the $25 million earmark grant.

The charged counts include criminal enterprise, three counts of false pretense of $100,000 or more, two counts of embezzlement of $100,000 or more, and a violation of the state's safekeeping of public moneys law, which prohibits public officers or their employees from commingling public funds with their own money.

If convicted, Coker faces up to 20 years in prison.

"His non-disclosure was an attempt to defraud and cheat," Megyesi told Judge Simmons at the close of a two-day preliminary exam to establish probable cause for embezzlement charges against Coker.

Sources: Bridge Michigan, The Detroit News, Lansing Today