Inspector General cites $19 million ‘loss’

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Systemwide, the Chicago public schools lost an estimated $19.2 million through fraud and budget waste in 1994, according to a December 1995 report from the Office of the Inspector General.

Most of the waste was in two areas, the report states: $6 million in unwarranted overtime for school custodial staff, and about $10 million for a featherbedded playground staff. In random, unannounced visits to playgrounds and stadiums, inspectors found numerous instances of absent staff, closed facilities and non-existent programs, according to the report.

The report faults former Supt. Argie Johnson’s administration for not acting on a number of recommendations, including cuts in overtime and eliminating playground staff. The recommendations “went to the highest level,” says Inspector General Kenneth Holt, the veteran FBI agent hired in April 1994 after the Illinois Legislature mandated the position.

“That’s a valid criticism,” acknowledges former School Board member Jim Flanagan. Johnson’s administration was considering the cuts, he adds, “but Holt is right in that we dropped the ball. We should have been more aggressive.”

Later, the new School Reform Board of Trustees acted on both counts, eliminating playground positions and most custodial overtime.

Other abuses documented in the report include falsification of time sheets; teachers and a principal, all of whom lived in the suburbs, using false Chicago addresses to enroll their children in Chicago schools; excessive absenteeism among school bus aides; and mismanagement of school internal accounts.

Twelve of the cases were found to involve criminal wrongdoing and were sent to the Cook County State’s Attorney’s Office and the FBI for further investigation; 93 cases are still pending; 114 were closed; and another 140 were opened.

Despite the abuses detailed in the report, asserts Holt, “The vast majority of Chicago public school employees are hardworking, ethical people. But you’ve got a certain number of people who are abusers, and they’re going to be there until you ferret it out.”

Holt’s staff has been beefed up this year; the number of investigators went from two to six, and another two are slated to be hired. The new board also opened its own Office of Investigations, headed by former Chicago Sun-Times reporter Maribeth Vander Weele.

The Inspector General’s office maintains a hotline for reporting suspected fraud; the number is (312) 939-1090. Operators take calls from 9 a.m. till 5 p.m.; after hours, voice mail is available.