BAY CITY, Mich. – A Michigan man who defrauded two non-profits out of more than $750,000 while serving in top leadership roles, driving a historic theatre into bankruptcy, has been sentenced.
Michael Bacigalupo, 64, of Essexville, was sentenced to 24 months in federal prison by U.S. District Judge David M. Lawson, according to a release from the U.S. Attorney’s Office for the Eastern District of Michigan.
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He was also ordered to pay $196,641.17 in restitution to the Bay County Historical Society and $151,000 to the Bay City State Theatre or its successor. After his release, he must also serve two years of supervised release.
From June 2020 to November 2023, Bacigalupo simultaneously served in the following positions:
- Director of the Bay City Downtown Development Authority
- Chief Operating Officer of the Bay City State Theatre
- Executive Director of the Bay City Historical Society
Without board approval from either organization, Bacigalupo used the funds to renovate the Wenona Park Bandshell.
“In the first phase of the scheme, Bacigalupo approached the Bay County Growth Alliance (BCGA), a local non-profit lender, and obtained an $800,000 loan using the BCST building as collateral. He falsely represented to BCGA that the BCST Board had approved the transaction and provided fabricated board minutes to substantiate that lie,” according to the release.
Once he retrieved the loan money, he put it toward the bandshell project.
Bacigalupo made partial repayments of $277,000, but then stopped making payments, leaving a balance of at least $523,000.
Due to being unable to service a debt it never gave approval for, the theatre ultimately declared bankruptcy, according to the release.
Then, from November 2020 to January 2022, Bacigalupo used $231,541 of the Bay County Historical Society’s funding for the same project, altering accounting records and creating fake contractor invoices to do so.
Due to this, the society couldn’t complete renovations to its museum and had to lay off staff members.
In addition, Bacigalupo also received approval for a $900,000 grant from the Michigan Economic Development Corporation. Officials said he misrepresented the purpose of the funds and the identity of the applicant to get the approval.
When the agency requested documentation to release an initial $450,000, he submitted falsified invoices and accounting records. The documentation was deemed insufficient, and the grant was withheld.
The organization found that the documentation was insufficient and withheld the grant.
“Fraud in the garb of civic leadership is still fraud. And this man’s fraud hurt cherished Bay City organizations,” United States Attorney Gorgon said.