A state representative in Connecticut allegedly misappropriated more than $636,000 in federal relief funding, which was provided to the city of West Haven last year in order to help the municipality pay for expenses tied to the coronavirus pandemic.

Michael DiMassa, a Democrat who represents West Haven in the legislature, was arrested Wednesday morning and appeared in federal court in New Haven on a single count of wire fraud. He was released after posting $250,000 bail and did not comment as he left the courthouse. State House leaders quickly stripped DiMassa of leadership and committee assignments.

Federal prosecutors allege DiMassa, who also served as an administrative assistant to the West Haven city council, illegally funneled hundreds of thousands of dollars in federal funding to an LLC he established in January 2021.

That company, which was formed under the name Compass Investment Group, provided invoices to the West Haven city government purportedly for coronavirus-related jobs. But according to the federal investigators, no services were ever provided to the city in return for those payments.

The FBI and U.S. Attorneys office allege DiMassa then personally withdrew tens of thousands of dollars from the LLC and used some of that cash to buy gambling chips at the Mohegan Sun Casino.

It’s unclear which city officials approved the payments that went to Compass Investment Group. But DiMassa could have been in position to sign off on the invoices himself.

The West Haven city council placed him — and city finance director Frank Cieplinski — in charge of the roughly $1.2 million in federal CARES Act funding they received in late 2020. Both of them were considered to be the mayor’s “designees,” which gave them oversight of the federal money.

The checks the city cut to Compass Investment Group ranged from roughly $11,000 to more than $87,000, according to an affidavit filed in federal court. Those payments started in February 2021 and continued until September of this year, according to the affidavit.

The CT Mirror obtained one of the invoices that Compass Investment Group billed to the West Haven city government. That invoice showed the company charged the city health department more than $135 per hour for consulting services related to a “support staff COVID database.” The city has not released any invoices from Compass despite a Freedom of Information Act request filed by the CT Mirror on Oct. 7.

On Oct. 8, Mayor Nancy Rossi took to YouTube to announce she had found potential fraud in the federal spending.

FBI agents also visited West Haven’s city hall around that same time. And the Connecticut Office of Policy and Management had already announced an independent audit into West Haven’s spending decisions — part of a broader effort by the state to examine municipal use of $60 million in federal CARES Act funding.

Rossi did not return multiple phone calls from the Mirror, but she issued a statement via email late Wednesday evening arguing that DiMassa should go to prison if he is found guilty.

She also continued to claim that she could not comment further about the alleged fraud that happened within the city government. “I will update our residents when information becomes available and when its release will not compromise the ongoing investigation,” she said in the statement.

Bridgette Hoskie, a West Haven city council member, said Wednesday that she understood that DiMassa was innocent until proven guilty. But she said she was sickened by the allegations now leveled against him.

“It’s devastating for the city and our residents,” said Hoskie, who is chair of the city’s budget committee.

When she learned of the charges against DiMassa, Hoskie said, she couldn’t help but regret the city council’s decision to place him in charge of the $1.2 million in CARES Act funding West Haven received.

“That weighs on me a lot,” Hoskie said.

DiMassa could face up to 20 years in prison if convicted.

Meanwhile, more federal coronavirus relief funding continues to flow into West Haven’s coffers. The city is set to receive up to $29 million from the American Rescue Plan Act in 2021 and 2022.

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Andrew BrownInvestigative Reporter

Andrew joined CT Mirror as an investigative reporter in July 2021. Prior to moving to Connecticut, Andrew was a reporter at newspapers in North Dakota, West Virginia and most recently South Carolina. He’s covered business, utilities, environmental issues, the opioid crisis, local government and two state legislatures. Do you have a story tip? Reach Andrew at 843-592-9958