DETROIT Kenneth Graham, former CEO of steel supplier Thyssen-Krupp NA, will appeal his conviction on charges of conspiracy, money laundering and tax fraud, his lawyer says.
A federal jury last week convicted Graham and Kyle Dresbach, a former executive vice president of ThyssenKrupp.
Prosecutors argued that the executives ran a $6.5 million kickback scheme as they were expanding the companys steel plant in Detroit.
Both retired before they were indicted.
Grahams lawyer, Robert Harrison, says jurors single day of deliberations before they returned their verdict shows they were swayed by other corporate fraud cases nationwide. An appeal is certain, Harrison says.
Under sentencing guidelines, the defendants face a maximum of eight years in prison. Sentencing is scheduled for Nov. 19.
Prosecutors said Graham and Dresbach directed vendors to overcharge Thyssen for equipment.
They pocketed the money after their lawyer and accountant, Jerome Allen, laundered it, prosecutors asserted.
Allen reached a plea agreement for a reduced sentence in return for his testimony against the executives. Allen said he created bogus invoices for Thyssens equipment manager, Hurricane Machine Inc., at the direction of Graham and Dresbach.
Hurricane Machine collected a commission from equipment vendors and paid that commission to 16 side companies Allen owned or controlled. Allen then would pay Graham and Dresbach, prosecutors said.
Defense lawyers said Allen was a tax cheat who borrowed money from Graham and Dresbach and lied to government investigators to save himself.
Prosecutors countered that documents and checks backed up Allens allegations.
Terry Kosdrosky is a staff reporter for Crain's Detroit Business, a sister publication to Automotive News.