McNeal: Wake Schools Fraud Scheme 'Offensive'
Posted September 18, 2005
Updated November 18, 2006
Five people, so far, have been charged for conspiracy and obtaining property by false pretenses in a multi-million-dollar fraud investigation that rocked the Wake County Public School System.
Bill McNeal, superintendent of the Wake County Public School System, said the case against former employees in the system's Transportation Department and former employees with Barnes Motor and Parts is offensive.
When asked if the five people indicted so far should go to prison, McNeal answered: "Yes. If you rob from children, you go to prison."
The indictments showed $3.8 million of money was siphoned from the system's Transportation Department. Investigators said employees used fake orders to siphon money for themselves. Evidence showed they purchased electronics, furniture, golf carts, televisions, vacation campers and even cars.
The investigation looks only at a small window of time at the end of fiscal years 2003 and 2004 when spending was especially high.
The school system spent $206,611with Barnes Motor and Parts during fiscal year 2000-2001. During fiscal year 2001-2002, that number jumped to $1,023,239. The money spent with Barnes increased to $4,515,639 during fiscal year 2002-2003 and $4,253,838 during 2003-2004.
This snapshot of fiscal years 2003 and 2004 is enough to press serious criminal charges, but it's not enough to answer the lingering questions in this case.
Even though the school system said some of the money in question was spent on school system supplies and equipment, for example, it's not known how much was diverted for personal purchases.
The school board is hiring an outside auditor, but that audit will not answer how much fraud actually existed.
"This is not a financial audit down to the invoice level," said Patti Head, chair of the Wake County school board. "We're looking at processes and systems."
The school board also wants the outside audit firm to look for any other past problems and evaluate the new accounting changes in place to prevent future fraud.
McNeal said the public deserves an answer as to how the fraud happened.
"We're working to piece all that together because it's important for us to get out to the public exactly what went on," he said. "It's also a part of our credibility that we be forthcoming."
Indictments were handed down earlier this week on Vern Hatley, the former head of the Transportation Department for the Wake County Public School System; Carol Finch, former Transportation Department budget analyst; Bobby Browder, a former regional manager for Barnes Motor and Parts; Connie Capps, a former manager for Barnes Motor and Parts; and Capps' boyfriend Harold Estes.
They are all expected to turn themselves in to authorities over the next week, and prison time is anticipated for the individuals. Other indictments are expected over the next few weeks.