Detroit probe uncovers corruption in city schools
By Associated Press | April 28, 2016, 13:17 EDT
DETROIT (AP) — A dozen Detroit principals and an administrator are accused of finding a way to bleed their struggling public schools of $900,000 — ordering chairs, writing paper and other supplies that in most cases were never delivered, even as investigators doggedly battled fraud in a district that lacks textbooks and even toilet paper.
Federal authorities say the bribery and kickback scheme started as early as 2002 and ended earlier this year. It is the latest in a string of embarrassing public corruption cases where elected officials and workers succumbed to the temptation of an easy dime left in a too-often unguarded public till.
“They stole from the children,” said an angry Ida Byrd-Hill, who had two children attending a Detroit high school in 2009 during the height of the alleged kickbacks.
“We keep forgetting that these schools belong to the citizens of Detroit,” she said. “They don’t belong to Detroit Public Schools. They don’t belong to the principals. Everybody has forgotten who they work for. They work for the parents.”
Mostly middle aged, the 13 schools officials charged last month with conspiracy to commit bribery had salaries far above what the average Detroiter takes home. But a public records search by The Associated Press showed some faced bankruptcies, tax liens and other personal financial troubles just prior to or during the time they are accused of receiving kickbacks from longtime district supply vendor Norman Shy, 74.
Wayne State University Law School professor Peter Henning described it as a scenario that is all too familiar in a city where public employees think they are owed more than they get for difficult, thankless jobs.
“I doubt any of them really thought they were doing anything wrong — they (believed they) were just getting something they deserved,” Henning said. “They worked hard, were underpaid and had to deal with all the stuff that goes on in DPS.”
Henning said it “comes down to (the) basic morality” of city officials — or a lack thereof.
“If somebody wants to steal, they can steal. If somebody wants to take an improper benefit or payment, they can do it. Is anyone going to notice $100 here, a $1,000 there?” he said.
Federal investigators have been busy in Detroit for at least seven years. Much of their work involved uncovering rampant pay-to-play schemes at the highest levels of City Hall.
Disgraced ex-Mayor Kwame Kilpatrick is serving a 28-year prison sentence for corruption. Former City Council President Monica Conyers also spent time behind bars after pleading guilty in 2009 to conspiracy to commit bribery.
But the school bribery charges are particularly galling given the district’s poor finances. The state Legislature is being asked to enact a $720 million restructuring plan that would pay off the district’s enormous debt. Dozens of schools were forced to cancel classes this year as teachers called in sick to protest low pay, lacking supplies and over-crowded classrooms. Enrollment has dropped to about 46,000 students from 95,000 in 2009.
The state recently provided $48.7 million in emergency funding to keep the schools open through June.
Principals in Detroit were responsible for ordering supplies and selecting vendors. Authorities said that because of the scheme, the district paid thousands of dollars for auditorium chairs, supplemental teaching material, raised line paper and other classroom supplies that either never arrived or came in smaller quantities than ordered.
“At the core of this apparent scheme is something that’s very real — horribly resourced public schools,” Detroit teachers’ union president Ivy Bailey said last month, when charges were announced.
The probe evolved from a state audit of finances in a spin-off district of 15 low-performing Detroit schools. That led to the arrest of Kenyetta Wilbourn-Snapp, a principal at two high schools who was charged late last year with taking bribes to hire a company to perform tutoring services.
From there, federal investigators eventually found enough evidence to charge more administrators. Their average salary, without benefits, is about $98,600, compared with the median Detroit household income of about $26,000. Nonetheless, several of the accused educators found themselves in financial straits and appear to have accepted money, gift cards and checks from Shy to pull themselves out.
The U.S. Attorney’s office says Spain Elementary-Middle School principal Ronald Alexander received about $23,000 in kickbacks from May 2009 through June 2014. Alexander filed for Chapter 7 bankruptcy in 2011.
Suspended Thirkell Elementary-Middle School principal Clara Smith on Thursday became the first in the case to plead guilty. Shy’s company gave her a total of $194,000, including $18,000 in personal credit card and bill payments and checks to relatives and friends in 2011. She received Sam’s Club gift cards, cash and checks made payable to family members and friends. On or about March 10, 2010, one kickback was in the form of a $5,000 personal credit card payment. On Dec. 12, 2012 she received $4,000 in Walmart gift cards, prosecutors say.
Smith even kept track of how much was coming to her in a ledger, according to court documents. A tax lien was filed last year on her Southfield home.
“At first I said, ‘No, no, no,'” Smith said Thursday at her plea hearing. “But then I fell out of the grace of God.”
She said she relented after she was told by Shy that other principals were taking kickbacks. She said she used some of the money as gift cards for students and to decorate the school.
She faces up to five years in prison, a $250,000 fine and restitution when she is sentenced Sept. 7. Assistant U.S. Attorney Michael Buckley said he will recommend she serve no more than 57 months in prison and pay $194,000 restitution.
The U.S. Attorney’s office says a big chunk of the $900,000 in kickbacks went to Clara Flowers. Flowers, 61, had been an assistant superintendent in Specialized Student Services and a former principal. Now, she’s accused of receiving nearly $325,000 in the scheme.
Shy’s Allstate Sales received about $2.7 million from the district, according to court documents.
The Associated Press left messages seeking comment from attorneys representing the principals, who face up to five years in prison and a fine. Only Flowers’ attorney, Frank Eaman, responded.
Flowers plans to pay the district back, he said.
“She profoundly regrets that she became involved with a vendor who was paying kickbacks to administrators,” Eaman said. “She has completely cooperated with the authorities and will continue to do so. She will accept responsibility for her actions and accept the consequences of her actions.”
The U.S. Attorney’s Office says 10 other guilty pleas so far are scheduled into May, including plea deals with eight other principals. Shy is scheduled to plead guilty May 11.
Many of the kickbacks allegedly occurred after then-emergency manager Robert Bobb began attacking corruption and fraud in 2009, while trying to fix a $300 million budget deficit.
But somehow, the administrators evaded detection.
“I think it’s shocking anytime you hear that 13 very high-level school officials are engaged in bribery,” U.S. Attorney Barbara McQuade said. “If I were a parent or a teacher, I would not be satisfied that this could occur under anyone’s watch.”
Written by Corey Williams