One of the main ways to educate elected officials and staff on the importance of fiscal controls and internal audit functions is to distribute examples of frauds and fiscal mistakes made by similar agencies. Many times I hear the statement "That can't happen here - we only hire nice people..." which usually means to me they don't manage well. Below is one example where a school district administrator siphoned out $4-million and the School Superintendant took $2-million. ( I assume LI means Long Island, New York). Notice that they mention there had not been any school audits or oversight in two decades.
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from:
http://www.topix.net/content/ap/2366847874225308963920874229663080400726
LI administrator sentenced in $11 million school district scam
The Associated Press
September 19, 2006
While the crimes committed here may not have been 'violent
A former school administrator was sentenced Tuesday to up to nine years in prison for stealing more than $4 million from her district treasury for cars, vacation homes and ATM withdrawals in a scandal that eventually uncovered $11.2 million in missing funds.
State Comptroller Alan Hevesi has referred to the Roslyn school district case as the 'most extraordinary theft' from a school system 'in American history.' His office revived audits of school districts statewide in the wake of the Roslyn revelations, following more than two decades of virtually no oversight.
Pamela Gluckin, the district's former superintendent for business, received a jail term of 3-to-9 years. She was handcuffed and led away after declining to make any statement in court. As part of her guilty plea to grand larceny last November, Gluckin agreed to repay $4.3 million _ $2.3 million of which was still outstanding.
Former Superintendent Frank Tassone, who admitted stealing at least $2 million, was scheduled for sentencing as well, but he was hospitalized in Manhattan after suffering a possible heart attack, said his attorney. Tassone, who pleaded guilty to grand larceny last September, had his sentencing rescheduled to Oct. 4.
In all, six people, including Gluckin's son and niece, have pleaded guilty in the scandal. State auditors found that $11.2 million was stolen from the district between 1996 and 2004, but because some of the records are missing or were destroyed, prosecutors were only able to link about $7 million to Gluckin, Tassone and their co-defendants.
'One of the most important parts of what our children learn are good values, as they are taught to earn what they receive, and to be honest about their achievements, and to work hard, and that society will reward them for these,' said Meryl Waxman-Ben-Levy, a Roslyn school board trustee, who spoke on behalf of the district. '...But that there are consequences for dishonesty.'
Hevesi's office alleged more than 25 school officials, their friends and families benefited from the embezzlement scheme. Since the Roslyn scandal broke more than two years ago, administrators in several other districts have been charged with misusing, or in some cases stealing, taxpayer funds.
Sometime in the mid-1970s, state officials looking to cut spending decided that school districts no longer warranted outside audits and left spending reviews to local school boards. Since the Roslyn scandal broke, Hevesi has gotten approval to add more than 80 investigators to his staff to specifically monitor school spending.
'There is a generalized theme that if nobody watches a government agency or a private agency, you will have a geometric increase in mismanagement and corruption,' he has said.
Besides Tassone, the only other defendant still awaiting sentencing is Gluckin's niece, Debra Rigano, 46, of Mamaroneck, a former account clerk who admitted taking more than $780,000. She is facing a prison sentence of 2 to 6 years.
Gluckin's son, John McCormick, a home improvement contractor, was sentenced to five years probation and 100 hours of community service after pleading guilty in March to second-degree grand larceny and offering a false instrument for filing.
Tassone's longtime partner, Stephen Signorelli, who admitted falsifying business records to steal $219,000 from the school district, and Andrew Miller, an outside accountant who helped cover up the stealing, have previously been sentenced; Signorelli is serving three years in prison, while Miller received four months in jail.
The Roslyn school district, 20 miles from Manhattan, sends 95 percent of its high school graduates to college, and SAT scores are among the best in the nation.
'While the crimes committed here may not have been 'violent' in the physical sense, they certainly demonstrate nothing but contempt for every aspect of and participant in our school system,' Waxman-Ben-Levy said.
(This article is published under the fair use doctrine).
