Michael was arrested on October 29 "following an investigation conducted by members of the State Police Manhattan Criminal Squad," the cops said in a statement to Radar.
"An investigation was initiated after the State Police received a report that Lohan had displayed an 'Official Business' parking placard in the windshield of his 2015 Audi while it was parked on the street in the Gramercy section of Manhattan."
Police said the phony pass featured the New York State seal and was intended to make it seem like Michael was conducting business of the New York State Executive branch.
"Late Thursday afternoon, investigators discovered the placard prominently displayed on the dashboard of Lohan's vehicle, while the required NYC parking meter fare had not been paid," the statement said.
He was arrested for Criminal Possession of a Forged Instrument in the third degree and Criminal Impersonation in the second degree, both misdemeanors.
He's due back in court on December 14.