Michiganian who got tax credit is arrested

3/18/2010

LANSING - A convicted embezzler who snagged a $9.1 million business tax credit from the state of Michigan was arrested yesterday on a parole violation, one day after he appeared on stage with Gov. Jennifer Granholm as she announced the credits.

Richard A. Short, 57, the chief executive officer of RASCO, was arrested by Department of Corrections officers and state police, Corrections Department spokesman Russ Marlan said.

Authorities say they arrested Short after realizing the company CEO may have violated his parole by not informing the Corrections Department he had a job. Short owes $96,000 in restitution from fraud convictions, money he should be paying if he's working, Mr. Marlan said.

Short shared the stage Tuesday with Gov. Jennifer Granholm as she introduced the leaders of companies awarded $55 million in tax credits. She said RASCO - short for Renewable and Sustainable Companies LLC - planned to invest $18.4 million to establish a new headquarters in Flint.

The company filed articles of organization with the state last June.

The company hasn't begun receiving the credit.

The Michigan Economic Development Corp. said in a statement yesterday that it was "embarrassed" by the slip-up and would perform a background check of all company officers before handing out any future tax credits.

The state's economic development arm requires applicants to disclose current, pending, or expected legal action that may affect a company's ability to meet its obligations under the tax credit agreement. It said it will ask specifically for applicants to disclose any prior felony convictions by senior company executives.

Short was convicted in 2002 of embezzling money from Harding Energy Inc., of Norton Shores and was sentenced to at least two years in prison. He also pleaded guilty in 2002 to earlier fraud charges in Oakland and Genesee counties, according to Corrections Department and state police records.

Short was paroled in April, 2004, but was returned to prison the following February for violating his parole with additional fraudulent activities, Mr. Marlan said.

He was released on parole again in January, 2007. His parole was recently extended to January, 2011, because he hadn't repaid the money he owes, Mr. Marlan said.

"If he is in fact the CEO of a company and is being paid, that is something we would want to be aware of because we would want to make sure we get some of that money for restitution," Mr. Marlan said.

Short did not respond to phone messages left yesterday before his arrest. He spoke Tuesday about how RASCO would improve the lives of poor people overseas by using renewable energy to provide electricity, clean drinking water, sanitation, and Internet service.