Principals steal $1m in bribe scheme


Detroit. — In its latest crackdown on school corruption in Detroit, the federal government dropped a legal bomb on 12 current and former principals, one administrator and a vendor — all of them charged with running a nearly $1-million bribery and kickback scheme involving school supplies that were rarely ever delivered.At the heart of the alleged scheme is businessman Norman Shy (74) of Franklin, who is accused of paying $908 500 in kickbacks and bribes to at least 12 Detroit Public Schools principals who used him as a school supply vendor in exchange for money — some for as little as $4 000, another for $324 000.

He secretly did this for 13 years, scamming school after school to the tune of $2,7 million with the help of principals who benefited along the way, prosecutors allege.

The news of the corruption case comes at a critical time as the state grapples with fixing the finances of the struggling Detroit district, the largest school system in Michigan.

DPS has been under the control of a state-appointed emergency manager since 2009 and has accumulated an operating deficit of at least $515 million.

Just last week, the Legislature passed $48,7 million in emergency funding to ensure that DPS doesn’t run out of cash early next month, as well as put the district under the authority of a financial review commission to oversee the district’s finances.

“This is exactly why House Republicans were so adamant that strong fiscal oversight be a prerequisite to any additional state funding for Detroit’s corrupt and broken school administration,” said Speaker of the House Kevin Cotter, R-Mt. Pleasant in a news release on Tuesday.

“And it is why we will continue to insist that strong financial and academic reforms be a part of any long-term solution to decades of DPS failures,”

US Attorney Barbara McQuade announced the sweeping charges at a news conference on Tuesday afternoon, calling the case “a punch in the gut”.

McQuade stressed that the charges have nothing to do with DPS’s existing financial troubles, or the political debate surrounding whether the state should help the city’s struggling school system.

“Public corruption never comes at a good time,” McQuade said.

“This case is not about DPS. It is not about emergency managers. It is about these 14 individuals who breached their trust.”

McQuade noted that the charges stem from a two-year-old audit of the Education Achievement Authority, a state-formed agency that was supposed to oversee and help Detroit’s most troubled schools.

That audit raised red flags, including one that led to the eventual indictment of former principal Kenyetta Wilbourn Snapp, who pleaded guilty to bribery two months ago and agreed to co-operate with the government in its prosecution against others.

Snapp, who was hailed as a once-rising education star and turnaround specialist, admitted to the Free Press in December that she pocketed $58 050 in bribes from a vendor and spent it on herself while working for the embattled EAA.

Snapp, who is set to be sentenced on June 1, faces up to 46 months in prison for bribery. Two other people have also pleaded guilty in that case — a contractor who acted as middleman and a vendor.

McQuade would not say whether Snapp’s co-operation led to any of charges, only that the EAA investigation revealed more evidence of wrongdoing by Detroit school officials.

Among those charged is Clara Flowers (61) of Detroit, an assistant superintendent of DPS’s Office of Specialised Student Services. She is charged with pocketing $324 785 in kickbacks from Shy for using him as a school supply vendor.

The kickbacks came in the form of cash, gift cards and payments to contractors who put a new roof on Flowers’ house, painted it and did gutter work.

Flowers first used Shy sometime before 2009, when as principal of Henderson Academy she chose his company as that school’s school supply vendor. She would continue to use Shy as a vendor when she became an assistant superintendent.

According to court documents, Shy maintained a ledger to keep track of how much money he owed Flowers in kickbacks.

The two regularly met to discuss how much Flowers was owed for her favours, and Shy was careful not to get caught, disguising his payments to Flowers in a variety of methods such as checks payable to contractors who worked on Flowers’ home, including one company that did painting and gutter work. Shy also used DPS money to help pay for a new roof on Flowers’ house.

The Free Press attempted to contact attorneys for all 14 defendants. Only one offered to comment. Most were unavailable; two declined comment, saying it was too premature to discuss the case.

The one defence lawyer who did speak is Doraid Elder, who is representing Stanley Johnson (62) the former principal of Hutchinson Elementary-Middle School, charged with accepting $84 170 in kickbacks from Shy.

“Let’s not rush to judgment. These are merely allegations,” Elder told the Free Press.

“ I don’t want people to forget that he’s put over two decades of his heart and soul into giving kids the best education possible.”

According to court documents, Johnson ordered school supplies from Shy, then submitted false invoices to DPS, which in turn paid for goods that were rarely delivered.

Shy would secretly funnel money back to Johnson by issuing payments to sham companies that Johnson created to conceal the kickbacks, prosecutors allege.

Elder said Johnson is “obviously devastated by the charges”.

“At times, he’s reached in his own pocket and paid for things to help get the kids certain resources that they normally would not be able to get. He’s had decades of a stellar record. I’m sure this is not easy for the students, the parents nor the individuals charged.” — Detroit Free Press.

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