Case Developments in Bay City
The defense attorney for former nonprofit executive Mike Bacigalupo is requesting a reduced sentence as the case approaches its final stage in federal court.
A sentencing memorandum filed on April 16 asks the court to impose supervised release instead of prison time, along with restitution and forfeiture exceeding $196,000.
Defense vs. Prosecution Recommendations
Bacigalupo, 65, is scheduled to be sentenced soon by David M. Lawson at the U.S. District Court for the Eastern District of Michigan.
While the defense is seeking a non-custodial sentence, federal prosecutors have recommended a significantly harsher penalty—54 months in prison followed by three years of supervised release.
Defense attorney Jeffrey Rupp argued that the government’s portrayal of Bacigalupo is exaggerated and fails to reflect the full context of his actions.
Fraud Involving Local Nonprofits
Bacigalupo previously pleaded guilty to one count of wire fraud tied to his leadership roles at the State Theatre and the Bay City Historical Society between 2020 and 2023.
During this time, he also served as director of the Bay City Downtown Development Authority.
Court records indicate he redirected more than $750,000 in nonprofit funds away from operational needs and instead used the money for renovations to a public bandshell.
Impact on Organizations
The misuse of funds had serious consequences:
- The State Theatre entered bankruptcy after defaulting on a loan tied to its building
- The Historical Society lost critical funding intended for renovation and preservation
Authorities also say Bacigalupo attempted to obtain a $900,000 federal grant using false information, though no funds were ultimately issued.
Fabricated Records and Cover-Up
Investigators found that Bacigalupo created false documentation to conceal the fraud, including:
- Fabricated board meeting minutes
- Fake invoices
- Manipulated financial records
These actions allowed the scheme to continue until it was uncovered.
Defense Argues Lack of Personal Gain
Rupp acknowledged the wrongdoing but emphasized that Bacigalupo did not personally profit from the scheme.
The defense maintains that his actions were misguided attempts to improve community infrastructure rather than intentional fraud for personal enrichment.
Sentencing Decision Pending
The court will now decide between the prosecution’s request for prison time and the defense’s appeal for leniency.
The ruling could set an important precedent regarding accountability and sentencing in nonprofit fraud cases.