John R. Lynch, 56, of Grosse Pointe Park, was arrested Thursday (April 8) in connection with the case.
Officials said Lynch became the CFO of the Holy Cross organization in March 2012, and later became its CEO in 2015.
Holy Cross was established in 1948 when Boysville of Michigan was incorporated under the auspices of the Roman Catholic Archdiocese of Detroit. Boysville of Michigan later became Holy Cross Children’s Services, federal officials said.
The organization provides welfare services to disadvantaged children and adolescents and behavioral health services to adolescents and adults. It also supports the homeless.
While he was CEO of Holy Cross, Lynch used the organization’s funds to pay for repairs to his own cars, install a new roof on his house, pay down his personal mortgage balance and make payments on a personal American Express account, according to authorities.
He used Holy Cross funds to pay his own consulting company and hire another company to provide security services at Holy Cross’s Samaritan Center, feds said. That security company was controlled by Lynch, according to officials.
The complaint accuses Lynch of using his corporate Holy Cross American Express card to buy goods and services for personal use.
Lynch tried to justify some of the payments with fake invoices, authorities said.
Officials said Holy Cross receives federal funds under the National School Lunch Program and the School Breakfast Program. It also receives federal funds under Title IV-E of the Social Security Act, which pays for foster care and provides adoption assistance and guardianship assistance, they said.
Lynch is charged with wire fraud, mail fraud, and embezzling and stealing funds under the care, custody, and control of an organization receiving federal funds.
He pleaded not guilty Thursday and was released on a $10,000 unsecured bond.
Officials said a determination on whether to seek a felony indictment will be made when the investigation is complete. FBI officials are conducting the investigation.