The Downfall Of A Greedy Chief Executive Officer

***READER DISCRETION IS ADVISED***

Posts about real school tragedy, crime and/or events can be upsetting.

Greetings from Northern California,

Sadly, there was another senseless shooting this week, in a small Northern California community about three hours from where I live.

When shots were heard the school staff reacted quickly and placed the school into lock down seconds before the shooter arrived at the school. A local law enforcement spokesperson said to reporters, he believed the fast-acting staff saved lives.

As horrific as this type of event is for all who were touched by the tragedy, it also triggers memories for many others who were connected to other school crime events. My heart hurts for all who have suffered from this cruel act.

BLOG POST #138: This week, I’m sharing research on a specific criminal case involving a school district’s Chief Executive Officer.

Building a Legacy

Before becoming the Chief Executive Officer (CEO) of the nation’s third-largest, financially strapped, metropolitan school district, she began her career in public education as a school teacher. She went on to become a prominent figure in urban education and served as the head of another large metropolitan school district as the chief academic and accountability officer.

To say she was highly respected would be an understatement.

She stepped out of public education briefly to work as a consultant with a firm that offered professional development training for school administrators, consulting services and school diagnostic review and turnaround programs.

Money Talks

While working as the CEO for the large metropolitan school district, she orchestrated the approval of no-bid contracts worth more than $23 million for services with her prior employer where she had worked as a consultant in exchange for hundreds of thousands of dollars in bribes and kickbacks.

Adding Fraud to the Resume

By agreement, she pleaded guilty to one count of wire fraud and assisted in the case against the consulting firm. The judge sentenced her to a 54-month prison sentence, fined her $15,000 and ordered that she and her co-defendants jointly share in a $254,000 restitution payment to the school district.

At the time of this posting, she’s currently serving time in a minimum security prison. Her scheduled release date is in 2021; she’ll be 72.

My ‘Take Away’ in this case: Her annual salary was more than $250,000 at the time of her arrest. I can’t fathom circumstances so dire you see no other option but to steal large sums of money from your employer. Nor can I understand someone who is so arrogant they think they can steal large sums of money from their employer AND get away with it.

What do you think about this case? Join the conversation on the website. We talk about the sensitive subject of crimes occurring at or connected to schools. Your relevant comments are always welcome on the Research Blog.

Do you know of a school crime you’d like to share? Email me so we can discuss the details.

Thanks for reading!

-Robin

Link to AmazonMAC: A Prequel Novella

Find out what Cole ‘Mac’ MacKenna  is up to in

UNKNOWN THREAT and MAC

Both Available at Amazon

Corruption At The Charter School

Robin Lyons' Blog Post #123Charter schools are funded with tax-payer money but managed privately.

They have more flexibility with curriculum, budget, and staffing. Charter Schools are NOT exempt from standard accounting practices.

BLOG POST #123: This week, I’m sharing research on a specific criminal case about an Executive Director of a Charter School.

Stealing From The Most Vulnerable

It was the Executive Director’s frequent deposits to purchase a total of $760,000 in life insurance annuities from a financial security company that eventually raised red flags at the company, and they reported the suspicious activity to the FBI, prompting an investigation.

The Executive Director was unable to explain how she was able to purchase the annuities. Her personal income couldn’t justify the large amount.

The state revoked the school’s charter and ordered the school to close. Approximately 140 elementary-aged disadvantaged children were attending the charter school at the time it closed the doors permanently.

The Outcome Could Have Been Much Worse

Technically, what she did was money laundering which would have given her a longer sentence. Instead, she was charged with two counts of embezzling federal property. One count for the USDA, Department of Agriculture money (school lunch program) and one count for the DOE, Department of Education money (Title I, Title II, and IDEA – Individuals with Disabilities Education Act).

At her trial, evidence showed from 2007 – 2013, she transferred $1.56 million in federal government funds from the school’s bank account to shell companies she created and controlled.

She was supposed to help children who were needy children, who had a lot to gain from a good education,” the U.S. Judge said just before pronouncing her sentence.

Her Career In Education Is Over

The former Executive Director was found guilty on both embezzlement charges and was sentenced to 42 months in a federal prison and ordered to pay over $1.5 million in restitution.

The court ordered her to pay $954,662.61 to the USDA and $607,271.58 to the DOE. And she was ordered to forfeit over $750,000 in life insurance annuities as well as her share in a house she owned.

Worth mentioning: The former Executive Director filed an appeal contending that the government failed to show the $1.56 million she embezzled belonged to the federal government. She argued that, because the money from state and federal sources was commingled in one undifferentiated account, the government could not show that the money she took was federal, as opposed to purely state, money. Her appeal was denied.

What do you think about this case? Your relevant comments about this post or any of the other posts are always welcome on the website.

Do you know of a school crime you’d like to share? Email me so we can discuss the details.

Thanks for spending part of your day or evening reading this post and for caring about children!

-Robin

Link to Amazon  MAC: A Prequel Novella

Find out what Cole ‘Mac’ MacKenna is up to in

UNKNOWN THREAT and MAC

Both Available at Amazon

This Christian School Headmaster Was Especially Ruthless

Blog post #98First, thank you for taking time from your busy life to read my post. I believe with knowledge of school violence and awareness we can make a difference.

Some crimes involving schools aren’t violent. Nonetheless, they negatively impact everyone in the school and to some degree the community as well.

BLOG POST #98: This week, I’m sharing research on a specific criminal case involving the Headmaster of a Christian School.

First red flag: One year before he joined the church, the headmaster was convicted of federal tax violations.

Are All Christians Honest?

Private schools have more control than public schools enabling the board of directors to take action more swiftly. At the same time, as you’ll see in this post, private school leadership can be naïve and overly trusting. Who would set out to purposely harm a Christian school, right?

The FBI special agent in charge, in this case, said it best:

It takes an especially ruthless person to steal money intended to educate children and promote religion and use it to bankroll an extravagant lifestyle you’d otherwise never be able to afford.”

Become Indispensable

He joined the Church in 1991 and volunteered to be treasurer giving him access to and control over the Church bank accounts. If you’ve ever been a part of a group or organization run by volunteers, you know, it’s not easy to fill vital positions like secretary, treasurer, etc.

In 1994, members of the church opened a Christian school. Two years later, the church hired the volunteer treasurer to be Headmaster of the School.

As the chief financial officer and headmaster, the board of directors gave him control over the finances and bank accounts.

It’s a Shell Game

He began siphoning money from the church and school 4-years after becoming headmaster. His crime spree ran 16-years. During that time he stole close to 9-million dollars or an average of more than $500,000 per year.

He purchased several real estate properties; luxury vehicles; a boat and jet skis; gold and silver coins; preferred seating season tickets with the local NFL team; and gifts for family and friends. He also took his family on vacations around the world and enjoyed luxury dining. He used school and Church money to build a lakefront house for approximately $1.2 million dollars. However, the project ran short on funds, so he made school employees take a 5% cut in pay claiming it was due to severe economic conditions.

To hide his theft, he opened approximately 29 checking accounts, obtained 26 credit cards, 7 loans, and created 9 limited liability companies.

He also created false audit findings from a fictitious accounting firm stating the school had been through a full audit and received an unqualified clean financial bill of health.

The Jig is Up

Second red flag: His lavish lifestyle became blatant and excessive for the income he received. Finally, the Church leadership became suspicious and called for an independent audit.

In an attempt to prevent law enforcement and others from discovering the nature and extent of his embezzlement activities, he intentionally stole and destroyed school financial records.

He was arrested and charged with embezzlement. He pleaded guilty and was sentenced to 60-months in federal prison and to pay restitution of more than 9-million dollars. Upon release, the former headmaster was also ordered to serve 3-years under court supervision.

What do you think about this case? Do you know of a school crime you’d like to share? Email me so we can discuss the details.

If you thought this post was interesting, check out this earlier post: Associate School Superintendent

Thanks for reading!

-Robin

Link to AmazonAvailable at Amazon

UNKNOWN THREAT

Book 1 in the School Marshal Series

An entertaining Mystery/Thriller novel

Internal Wire Fraud

internal-wire-fraud-fbBLOG POST #90: This week I’m sharing research on a superintendent of a kindergarten through 12th-grade school district. Although this crime doesn’t physically harm students, it speaks to the character of a person who was the leader and decision maker in the school district.

He worked for the school district for over 37-years. The last 15-years he was the superintendent. After he retired, he was a school board member for five years in the same district. He was so well-liked; a school building was named in his honor.

One of the school board members was a whistleblower in this case. It was investigated by the FBI for two years. During the two-year period, the two investigating FBI agents attended many board meetings.

During the former superintendent’s final eight years, he caused others in the school district to falsely report his inflated salary to the state retirement system. The inflated salary improperly included fringe benefits; car/travel stipends, insurance premiums, a tax shelter annuity, district vehicle payment, and unused vacation pay. His retirement salary was based on the inflated salary.

You might wonder how this became a ‘wire fraud’ case. The salary contribution information was transmitted to the state retirement system using the Internet. The information hit various servers and crossed state lines, making it a federal wire fraud crime.

In a victim impact statement, it was said, “He created an intimidating and fearful culture in which laws were viewed as nothing more than obstacles to be overcome in the promotion of self-interest.”

The former superintendent pleaded guilty to one count of federal wire fraud. He was sentenced to one year plus one day in federal prison, without the possibility of parole. He was also ordered to pay restitution of $662,000 to the Public School Retirement System.

“Today’s criminal felony conviction brings to conclusion an extensive, thorough investigation into fiscal wrongdoing in the school district,” the United States Attorney said.

What do you think about this case? Do you know of a school crime that you feel others should be made aware of? Email me so we can discuss the details.

Thanks for reading!

-Robin

Associate School Superintendent Sentenced to 12-Months in Prison

Photo of front griill on a JaguarThe School District of the City of Pontiac, a world class school district, is located in Pontiac, Michigan. The district’s core values include Safe and Orderly Schools. Embezzlement isn’t a direct safety threat to school children; indirectly everyone pays the price when someone in a position that controls the money embezzles. If wrongdoing can happen at the School District of the City of Pontiac in Michigan, it can happen anywhere.

He was the Associate School Superintendent and acting CFO of Pontiac Schools when he directed a subordinate to issue a $236,000 check to his Leadership Academy. He provided the district with a fraudulent invoice to validate the expenditure. Later, he transferred the money to his personal account from which he financed travel and purchased a Jaguar.

You can read the full FBI Press Release here: Associate Superintendent

The former Associate School Superintendent pleaded guilty to one count of defrauding a program receiving federal funding, including Title I funding. He was sentenced to twelve months in prison, one year of home confinement, and three years of supervised release. In addition, he was ordered to pay $336,000 in restitution to the school district.

School officials who steal money are particularly culpable because they are robbing children of their education, said U.S. Attorney McQuade.

Regarding the case, United States Attorney Barbara McQuade said. “Among all of the corruption defendants we charge, school officials who steal money are particularly culpable because they are robbing children of their education.”

He served his sentenced and was release 8/5/2014.

What are your thoughts on this crime?

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