Ex-Chicago Schools Head to Plead Guilty to Fraud
While the news on October 8 and October 9, 2015, was dominated by the indictments of Byrd Bennett, Solomon and Vranas, a lot has yet to be examined, even though it is obvious to most close observers of CPS activities that Byrd Bennett could never have gotten away with such a bold scheme without the active collaboration of the seven members of the Chicago Board of Education, all of whom voted unanimously and without debate at their June 26, 2013 meeting for the $20.5 million no-bid SUPES deal.The Sun-Times editorial board offered a few words on this outrage.
The Chicago Tribune (requires registration) makes this observation:
Is anybody holding their breath waiting for Emanuel to fall on his sword?
by Lauren Fitzpatrick, Jon Seidel, and Dan Mihalopoulos
Even before she was hired to run Chicago Public Schools, Barbara Byrd-Bennett set up a scheme to get a 10 percent kickback on all the CPS contracts she could steer to a former employer, in part to set up a college fund for her twin grandsons, authorities said Thursday.
The feds found damning, detailed emails between her and her ex-boss, Gary Solomon -- apparently so damning that Byrd-Bennett will plead guilty in the case involving $23 million in CPS contracts. U.S. Attorney Zachary Fardon, in an unusual move, announced Byrd-Bennett's intention to plead as he announced the charges.
"I have tuition to pay and casinos to visit :)" the feds say Byrd-Bennett wrote in one of many emails discussing the alleged kickbacks
Byrd-Bennett, 66, -- who was handpicked to lead CPS in October 2012 by Mayor Rahm Emanuel -- was charged Thursday with wire fraud and mail fraud in a 43-page indictment. Also charged were the owners of two businesses that got more than $23 million in no-bid CPS contracts -- Solomon, 47, of Wilmette, and Thomas Vranas, 34 of Glenview. They also face charges of bribery and conspiracy to defraud the United States, and two of their companies, The SUPES Academy LLC and Synesi Associates LLC, were indicted, too.
Byrd-Bennett becomes CPS' first chief executive officer to face criminal charges in connection with her job. Federal authorities have been investigating one of those contracts -- a $20.5 million no-bid deal for principal training, the largest in recent memory -- for more than a year. The investigation came to light in April when subpoenas landed at CPS, forcing Byrd-Bennett out. By then, CPS had paid SUPES all but $7.7 million.
The investigation continues, Fardon said, declining to elaborate. Byrd-Bennett has yet to appear before a judge and could enter her guilty plea as soon as her initial court appearance, not yet scheduled.
After running school systems in Cleveland and Detroit, Byrd-Bennett worked for SUPES and Synesi and was sent to CPS to coach short-lived Emanuel-appointee Noemi Donoso. Donoso resigned on April 28, 2012, and on May 1, Byrd-Bennett replaced her for a few months as chief education officer before Emanuel elevated her to CEO.
On April 29, according to the indictment, Solomon sent an email to Byrd-Bennett (in which he misspelled "principals"):
"When this stint at CPS is done and you are ready to re re re retire, we have a spot waiting for you.In the meantime, if we can figure out a way to do deep principal [professional development] at CPS, I can find a good home for [friends of Byrd-Bennett's] and others, and make sure principles in CPS get kick ass training..."
Solomon and Vranas then offered to give Byrd-Bennett a percentage of the proceeds of any contracts she helped them win, the indictment alleges.
By July 2012, the indictment says, Solomon offered college funds for two unnamed relatives of Byrd-Bennett's. A source familiar with the investigation identified them as Byrd-Bennett's twin grandsons.
Some kickbacks would be disguised as "a signing bonus" when Byrd-Bennett left CPS and returned to work at SUPES and Synesi, the feds say.
"If you only join for the day, you will be the highest paid person on the planet for that day," Solomon wrote. "Regardless, it will be paid out on day one."
CPS had begun using SUPES in 2011 to train district officials under a $380,000 pilot funded by the private Chicago Public Education Fund. But the Fund did not recommend continuing with SUPES, according to its CEO.
Yet on October 24, the same day she was approved as CEO, Byrd-Bennett asked the Board of Education to green-light a $2 million no-bid SUPES contract that grew to $2.3 million.
Solomon allegedly offered to arrange jobs for Byrd-Bennett's friends in exchange for more contracts and reimbursed her for a 2012 holiday party she hosted for CPS staffers. They handed her basketball and baseball game tickets, an airline ticket, meals and other personal items, the feds say.
By June 2013, weeks after Byrd-Bennett closed 50 neighborhood schools, saying the district couldn't afford them, she presented the $20.5 million no-bid deal for principal training to the Board. It was unanimously approved by six present members.
Catalyst-Chicago Magazine first reported the deal, which generated controversy because SUPES, unlike many local organizations, was not known for training principals. CPS principals soon complained about its quality.
Later in the summer, as the Sun-Times has reported, Solomon sought even more business from CPS for Synesi, but the Illinois State Board of Education wouldn't approve the company.
By December 2013, CPS' inspector general was investigating.
Fardon said that Byrd-Bennett never received any money, and that eventually, she and Solomon discussed destroying their emails.
"I think those emails reflect greed," Fardon said. "I think they reflect a public official who compromised her integrity and the integrity of her professional responsibility by looking to line her own pocket."
Byrd-Bennett did not return messages Thursday. Her attorney, Michael Scudder, declined an interview, saying in a statement that she would plead guilty.
"As part of accepting full responsibility for her conduct, she will continue to cooperate with the government, including testifying truthfully if called upon to do so," he wrote.
At a news conference, Solomon's lawyer Shelly Kulwin said Solomon had "done everything he can from the beginning of this to assist the government in their investigation."
Kulwin also said Byrd-Bennett's impending plea "doesn't affect Mr. Solomon's position at all." But Kulwin said he does expect a "pretrial resolution."
And Kulwin said prosecutors were "inaccurate" in suggesting Solomon's companies provided nothing worthwhile to CPS, but acknowledged, "There's no question things were done that should not have been done."
Speaking for Vranas, veteran criminal-defense lawyer Michael Monico would only say that "he's an excellent young man who has done many good things in his life. He does look forward to resolving this case and getting on with his life."
Solomon was a dean of Niles West High School who was forced out in 2001 after, court records show, he was accused by administrators of making racist and sexually harassing remarks. He is married to the daughter of prominent real estate developer John L. Marks, whose projects include the downtown Hard Rock and House of Blues hotels.
Vranas is a son of former Chicago Association of Realtors president John P. Vranas. He was a student at Niles West during Solomon's tenure as dean.
Solomon and Vranas recently sold parts of their companies.
CPS CEO Forrest Claypool, appointed after Byrd-Bennett resigned, said that "no one individual reflects the work of Chicago Public Schools, and thousands of principals and teachers are working hard today to educate our nearly 400,000 students. CPS is strengthening its procurement process based on an independent review."
CTU President Karen Lewis, who forged a bond with Byrd-Bennett, said she wished "Mrs. Byrd-Bennett well in her legal battles," adding, "The circumstances surrounding the indictment of the former CEO are unfortunate and mark a sad day for the leadership of our district."
Contributing: Fran Spielman
Lauren Fitzpatrick, Jon Seidel, & Dan Mihalopoulos
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