Mobile mayor: Multiple investigations launched into $14.7 million scam loss

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Mobile mayor: Multiple investigations launched into $14.7 million scam loss



Mobile’s mayor says a nearly $15 million scam of city funds involved the on-going construction of the city’s new $300 million civic center.


“This is bad and there’s nothing I can say to make it good,” Mobile Mayor Spiro Cheriogotis said Wednesday, the day after his administration revealed that $14.7 million had been transferred to a “fraudulent entity.”

Speaking to reporters late Wednesday morning, Cheriogotis said there were many details of the situation that he couldn’t reveal because multiple investigations were in progress. He said that the money represented a single transaction in an ongoing series of major financial transfers involving an ongoing capital project, the construction of Mobile’s new arena.

“It is our city’s intention and commitment to be as transparent about this issue as we possibly can,” Cheriogotis said. “We have a fairly clear picture of how this happened internally. There are a lot of external factors and groups and individuals that are affected directly by this. Investigations continue.”


Cheriogotis said that in addition to conducting an internal investigation, the city had engaged “a nationally recognized law firm” that specialized in such cases; had hired a forensic firm that was going to conduct an audit of policies and procedures as well as a financial audit; had notified the carrier that provides the city’s cyber-insurance policy; and had notified the FBI and the Secret Service, which also were conducting investigations.

Miles Beckner, assistant special agent in charge for the national security division of the FBI’s Mobile office, said the agency does not comment on current investigations.

“But what I can tell you is, as always, we are working very closely with the city of Mobile, the Mobile Police department and the U.S. Attorney’s Office, [including] U.S. attorney Sean Costello,” said Beckner. “Because we, the Department of Justice and FBI, take fraud against our citizens, our cities, extremely seriously. And we will prosecute and investigate to the fullest extent possible any of these bad actors that are coming after our hard [-earned] taxpayer money.”

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