Trial ordered for former SVSU employee charged with embezzling from school, extortion in Michigan

A former Saginaw Valley State University employee charged with embezzling from the school for automobile repairs will stand trial, but not on the charges he initially faced.

Saginaw County District Judge Kyle Higgs Tarrant on Friday ruled that prosecutors showed probable cause to take Gregory D. Coburn, 56, of Bay City to trial in Circuit Court on charges of embezzling over $1,000 but less than $20,000 and extortion.
Prosecutors initially charged Coburn, a 22-year employee of the SVSU, with three counts of embezzlement by a public official.
Roland Bahm, who was the general manager at Firestone Complete Auto Care, 4590 Bay in Saginaw Township, testified at Coburn’s February preliminary hearing that at Coburn’s direction, the repair shop worked on Coburn’s 1996 Chevrolet Blazer twice and 1996 Chevrolet Lumina once and billed SVSU about $1,330 for the expenses.
Bahm, who no longer works at Firestone, said he told Coburn after the August transaction that he did not want to participate in the agreement anymore. Coburn said that if Bahm didn’t follow his request, that he would take SVSU’s business to another Firestone location, Bahm testified.
Bahm said SVSU accounted for 10 percent to 15 percent of his company’s business per month, and Coburn knew that.
After hearing the testimony, Tarrant ruled that Coburn is not a public official and is simply a government employee and said she would amend the charge to reflect that. Prosecutors appealed that decision, and Coburn’s then-attorney, Joseph E. Pergande, appealed prosecutors’ request to add a charge of extortion.
Coburn’s current attorney, Jeffrey J. Rupp, argued Friday that Coburn’s threat was not “pecuniary,” or consisting of money, because if the victim is Bahm, he wouldn’t actually lose any money, and if the victim is Firestone, the company would not lose money because Coburn would have gone to another Firestone business.
“It’s maybe a threat in a loose term, but that doesn’t make it illegal extortion,” Rupp said.
Tarrant disagreed, saying, “The circumstances are such that if (Bahm) didn’t commit a crime for (Coburn’s) own advantage, he would take the business elsewhere.”
The judge also denied the prosecutors’ motion to reconsider her decision to amend the embezzlement charge.
Duggan, who did not participate in the preliminary hearing in February, argued that the public official embezzlement law is “extremely broad.”
He argued that if someone is working for the government, he or she “ultimately is working for someone who is elected.” In the SVSU example, Duggan said, Coburn was working for the state governor, who appoints the Board of Control, who hires the president.
Rupp argued that if the judge were to adopt that theory, there would be no cut-off line. That theory, Rupp argued, could extend to the SVSU students who also work in the motor pool and the Firestone employees who serviced the vehicles.
Tarrant said she doesn’t even view SVSU President Eric R. Gilbertson as a public official.
The members of the Board of Control could be considered public officials, the judge said, “but they are so distant from (Coburn) that he would not be a public official when he was doing this work. I don’t see him in that category.”
With the judge’s decisions, Coburn now faces a stiffer maximum penalty.
The public official embezzlement charge carries a maximum penalty of 10 years in prison or a fine of $5,000, while the embezzlement over $1,000 charge carries a maximum of five years or a $10,000 fine. The extortion charge, however, carries a maximum penalty of 20 years in prison and a fine of $10,000.
Because Coburn does not have any prior felony convictions, however, he likely would not face time prison time if convicted.
Coburn remained free today on a $6,000 personal recognizance bond.