A bombshell indictment today. Former Chicago Public Schools CEO Barbara Byrd-Bennett is charged with 23 counts of federal corruption for her alleged role in a scheme to steer millions in CPS contracts to her former employer, a principal training academy, in exchange for millions in bribes and kickbacks. Byrd-Bennett is expected to plead guilty.
Byrd-Bennett is charged with steering $23 million in CPS contracts to two companies, SUPES Academy and Synesi Associates, where she had formerly worked and with whom she still had a close relationship. The companies and their owners, Gary Solomon and Thomas Vranas, are also charged in the indictment. All are said to be cooperating with federal authorities
Here’s how the scheme is alleged to have worked: Byrd-Bennett and the two companies conspired to convince the Chicago Public School board it needed to spend millions on principal training. Byrd-Bennett convinced them to approve no-bid contracts. In return, the companies would agree to pay her a 10 percent kickback in the form of trust funds for two of Byrd-Bennett’s relatives and a promise to hire her back once she left CPS.
“I have tuition to pay and casinos to visit.”
“When this stint at CPS is done and you are ready to re re re retire, we have your spot waiting for you,” says an email from SUPES to Byrd-Bennett.
“It is our assumption that the distribution will serve as a signing bonus upon your return to SUPES/Synesi. If you only join for the day, you will be the highest paid person on the planet for that day,” another email reads.
Chicago’s top federal prosecutor says the alleged scheme defrauded CPS out of millions.
“Byrd-Bennett put her thumb on the contract award process at Chicago Public Schools. She made clear to her staff she wanted more money for professional development training programs. She made clear she wanted those contracts to be sole-sourced instead of competitively bid. And she made clear she wanted those sole-source contracts to go to SUPES,” said U.S. Attorney General Zachary Fardon. “She and her co-defendants worked to hide and conceal her graft. She hid and concealed her financial interest in those contracts from the Chicago Board of Education and others.”
In fact, Byrd-Bennett answered “no” to the question: “Did the Chicago Board of Education award any work, business, or contracts to any person or entity in which you or a relative have an economic interest?” on a Chicago Public School disclosure form. Neither the Chicago Board of Education nor the mayor are implicated, but are certainly under fire for allowing, in one instance, a $20 million no-bid contract to be awarded to SUPES.
In another email, Byrd-Bennett tells SUPES’ Gary Solomon: “I have tuition to pay and casinos to visit.”
“Those emails reflect greed,” Fardon said. “I think they reflect a public official who compromised her integrity and the integrity of professional responsibility by looking to line her own pockets.”
Initial questions into Byrd-Bennett’s conduct began two years ago, right after the 50 school closings. Catalyst Chicago, an education magazine, first questioned the relationship between Byrd-Bennett and SUPES Academy after the $20 million no-bid contract was awarded. The CPS inspector general then asked for emails between Byrd-Bennett and the company before the case was referred to the feds. The original reporter says board members should have more carefully scrutinized the deal, and that the timing raises a lot of questions.
“Here you close 50 schools to save money, and then you spend $20 million to train principals, which is a noble idea, but it’s a lot of money for a school district that’s so broke that you have to close 50 schools,” said Sarah Karp, who is now with the Better Government Association.
Attorneys for the two alleged co-conspirators acknowledge the misconduct of their clients, but say it doesn’t mean CPS didn’t get some value out of those contracts.
“There were things done that shouldn’t have been done,” said Shelly Kulwin, attorney for Gary Solomon. “Mr. Solomon recognizes he made errors in judgment in that regard and there should be consequences for that. But the indictment paints a picture of a company and person that did nothing for Chicago Public Schools and added no value. That’s simply not accurate.”
Meanwhile, Chicago Public Schools’ current CEO Forrest Claypool tried to downplay today’s news. The system is banking on $500 million in help from Springfield to plug this year’s out of whack budget.
Claypool says he’s put in controls to more carefully scrutinize no-bid contracts, and that the problem is not systemic.
“One individual does not represent CPS,” Claypool said. “We are showing week after week that CPS is managed as a professional organization with integrity. This is in the past, it’s not reflected of the current leadership.”
Mayor Rahm Emanuel, who appointed Byrd-Bennett to the CEO position in 2012 and appointed the school board members that approved the SUPES contract, issued the following statement:
"I am saddened and disappointed to learn about the criminal activity that led to today's indictment of Barbara Byrd-Bennett. Our students, parents, teachers and principals deserve better.”
Byrd-Bennett faces up to 20 years in prison and hundreds of thousands in fines. The indictment says that SUPES will have to forfeit $2 million.
Since they are all said to be cooperating with the government, the actual punishment may be much lighter.