http://chicago.suntimes.com/news/7/71/1019851/bennett-charged-kickback-scheme
Ex-CPS CEO Barbara Byrd-Bennett, 4 others charged in contract scheme
WRITTEN BY BY LAUREN FITZPATRICK, JON SEIDEL AND DAN MIHALOPOULOS POSTED: 10/08/2015, 12:21PM
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Ex-CPS CEO Barbara Byrd Bennett in 2014| Al Podgorski / Sun-Times Media
The former CEO of Chicago Public Schools, Barbara Byrd-Bennett, has been criminally charged in connection with allegedly steering more than $23 million in no-bid contracts from CPS to her former employer, authorities said Thursday.
Byrd-Bennett — Mayor Rahm Emanuel's handpicked choice — becomes CPS' first CEO to face criminal charges in connection with her job. Federal authorities have been investigating the most controversial of those contracts — a $20.5 million no-bid CPS deal for principal training, the largest in recent memory — for more than a year.
Receiving that contract in 2013 to train principals was The SUPES Academy, owned by former Niles West High School dean Gary Solomon and his former student Thomas Vranas. It generated controversy at the time because SUPES was not known for training principals while many other, respected organizations did that very job. The deal continued to draw criticism as some educators questioned the quality of SUPES' training.
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Solomon, 47, of Wilmette, and Vranas, 34, of Glenview, were also charged, as were SUPES and another company they owned that received CPS contracts, Synesi Associates LLC.
The feds allege that Byrd-Bennett, 66, and Solomon set up a kickback scheme, detailed in emails, in which Byrd-Bennett would get money in exchange for steering the CPS contracts to SUPES and Synesi.
The scheme started right around the time Byrd-Bennett started her job as chief education officer at CPS, the post she held before becoming CEO, the feds allege.
According to the indictment, on April 29, 2012, Solomon sent an Byrd-Bennett saying, "When this stint at CPS is done and you are ready to re re re retire, we have a spot waiting for you. Hopefully, with even more work and more opt. In the meantime, if we can figure out a way to do deep principal PD at CPS, I can find a good home for [friends of Byrd-Bennett's] and others, and make sure principles (cq) in CPS get kick ass training with kick ass teacher and kick ass coaching."
Solomon and Vranas then offered to give Byrd-Bennett a percentage of the gross revenues of the contract awarded if she helped, the indictment alleges.
By July 2012, Solomon offered a college fund for two relatives of Byrd-Bennett's. While the indictment does not name the relatives, a source familiar with the investigation said they are Byrd-Bennett's twin grandsons who live in Ohio.
Solomon ended up starting those funds, which were found to have had $127,000 each in them, or about 10 percent of the gross proceeds of an early deal to SUPES.
Some of the kickbacks would be disguised as "a signing bonus" when Byrd-Bennett left CPS and returned to SUPES and Synesi as an employee, the feds say.
In an email that Solomon sent to Byrd-Bennett, he allegedly wrote: "Like we have discussed, we have created accounts that, upon withdrawal, we will pay down the taxes and distribute. You can distribute to [Relative A and Relative B] as you deem appropriate. 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. Regardless, it will be paid out on day one."
Solomon also alleged offered to arrange to employ Byrd-Bennett's friends in exchange for more contracts and reimbursed her for a holiday party she hosted for CPS employees in December 2012.
The favors didn't stop there, with Solomon and Vranas also giving basketball and baseball game tickets, an airline ticket, meals and other personal items to Byrd-Bennett, the feds say.
Neither Byrd-Bennett and her attorney, nor Vranas and his attorney, could be immediately reached for comment Thursday.
In a statement, the law firm representing Solomon, Kulwin Masciopinto & Kulwin said he was disappointed, even though he acknowledged "certain errors in judgment that he (as well as others) made in the contract letting process" and also that Solomon "regrets his own errors . . . "
The statement continues: "As he has throughout, Mr. Solomon stands behind the training, mentoring, and counseling services that he, his companies, employees and contractors provided to the Chicago Public School System . . . Mr. Solomon strongly believes that these legitimate and valuable services, advocated by many individuals associated with CPS and the City of Chicago, benefited the CPS system, its principals, other employees, and students."
Solomon is married to the daughter of prominent real-estate developer John L. Marks, whose downtown projects have included the Hard Rock and the House of Blues hotels.
Vranas is a son of former Chicago Association of Realtors president John P. Vranas
U.S. Attorney Zach Fardon is expected to hold a news conference this afternoon to discuss the case.
In a news release, Fardon said: "Graft and corruption in our city's public school system tears at the fabric of a vital resource for the children of Chicago. School officials and city vendors who abuse the public trust will be held accountable."
After the federal investigation became public, Solomon's controversial past and current success within CPS came to light. He had been forced out as a suburban high school administrator after making racist and sexually harassing remarks. Despite that, he later played a key role in getting Byrd-Bennett her top job with CPS.
Solomon left Niles Township School District 219 under a cloud in 2001 after he was accused by administrators of "immoral and unprofessional" conduct, including allegations he kissed a female student, covered up students' drug and alcohol use and sent "sexually suggestive, predatory" emails to students, court records show.
Years later, he and Vranas founded SUPES Academy to train school leaders, and the two other education consulting companies in the northern suburbs. They recently sold parts of all three.
SUPES Academy employed Byrd-Bennett as a training coach before she landed at CPS. Previously, she had run school districts in Cleveland and Detroit. SUPES also was brought in to coach CPS' network chiefs through a pilot program under Byrd-Bennett's predecessor, Jean-Claude Brizard, but the program was discontinued after a year.
Brizard has called Solomon "instrumental" in getting Byrd-Bennett to CPS, first as a coach for CPS official Noemi Donoso, then as Donoso's replacement, then as Brizard's successor.
Emanuel elevated Byrd-Bennett to CEO in October 2012, about a month after the historic Chicago Teachers strike whose resolution she helped broker as the district's second-in-command. A former teacher and principal, Byrd-Bennett forged a bond with CTU President Karen Lewis when she helped negotiate an end to the strike. Sources told the Sun-Times that Board President David Vitale managed her contract and was "very, very supportive" of her promotion.
She championed the shutdown of 50 neighborhood schools in May 2013, saying the district couldn't afford to keep them open as enrollment dropped. A month later, she asked the Board of Education to approve the SUPES $20.5 million deal that had gone though CPS' "sole-source" or no-bid process. With no public discussion, the six board members who were there voted for the contract, including Jesse Ruiz, who served briefly as Byrd-Bennett's temporary replacement after she left.
Complaints about the training's quality quickly rolled in from principals. Leading education experts also said they'd never heard of the north suburban company, according to Catalyst Chicago magazine, which reported on the conflict of interest in its July 2013 issue.
By December 2012, CPS' inspector general was investigating the contract.
In late summer or early fall of 2013, Solomon allegedly told Byrd-Bennett that the inspector general wanted to see Solomon's and Vranas' emails. Solomon said that Vranas planned to use a computer program to delete the emails, according to the indictment. Solomon also allegedly told Byrd-Bennett she should delete her emails as well.
In April this year, federal agents delivered subpoenas to CPS for records about the Solomon companies, as well as records of "financial benefits, gifts, honoraria, meals and reimbursements" concerning Solomon and Vranas.
They also requested employment records for Byrd-Bennett, Martin, and two close Byrd-Bennett associates, Sherry Ulery and Rosemary Herpel. Martin was the $170,000-a-year head of a special network that Byrd-Bennett created at CPS to oversee struggling neighborhood schools.
Ulery, her $175,000-a-year chief of staff, and Herpel, a $140,000-a-year "executive director of leadership development" in CPS' HR department, were also called before a federal grand jury.
Two days after those subpoenas came to light, Byrd-Bennett left CPS on a paid leave. Her homes in Chicago and outside Cleveland had been searched by the FBI, sources have told the Sun-Times.
She resigned from CPS on May 29. Her aides also since have left CPS.
The current CPS CEO, Forrest Claypool, appointed after Byrd-Bennett resigned, declined to comment on the indictment, citing the "ongoing investigation."
Contributing: Fran Spielman
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