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From the School Board to the Prison Yard

When the victims of money laundering crimes are students, our entire education system is affected

Richard Paxton
Jun 24, 2016 · 4 min read

Victims of money laundering exist in great numbers and run the gamut from hoodwinked used car buyers to Medicare patients, and to even our own school children. You might be surprised to know the worldwide education system is not untouched by corrupt school officials. We don’t typically hear a victim’s story; for whatever reason, the media ignores stories of financial fraud and money laundering from the victim’s perspective. Instead, we typically learn only about the criminals and the crime itself. Today, as school is dismissed for the summer around the country, I’m focusing on how the victims of money laundering are affected by the crime with a special focus on our education system.

Marc Walker, former superintendent and Thomas Bloxham, former assistant superintendent at the Comal Independent School District (ISD) in New Braunfels, Texas, were both arrested on June 13 on felony charges of money laundering and misuse of school property. Both are accused of theft of property by a public servant, money laundering and misapplication of fiduciary property.

You can read the details of the case here, but it’s safe to say that both of these men abused their power to the greatest degree, acts that only really hurt the schools and the students. In the case of Walker, I’m flummoxed. How does a man with 34 years of experience in education, a former member of the Texas Youth Commission, a former superintendent for the Pflugerville ISD and even someone who ran as a candidate for interim superintendent of the San Marcos Consolidated ISD earlier this year, suddenly turn into a criminal?

This case is reminiscent of an earlier and even more disturbing one in Detroit.

Sandra Campbell, 57 a former Detroit Public Schools (DPS) contract accountant and former school board candidate, was recently convicted by a federal jury on charges of program fraud conspiracy, money laundering conspiracy and tax evasion. Her crime? Scheming with her 38-year old daughter Monique, a DPS teacher. The two embezzled over $500,000 and then conspired to launder the money by making regular payments from the school’s coffers for books and school materials to a shell company owned by Campbell.

How is it that the elder Campbell went from wanting a seat on the school board where she could positively influence district policy to jacking the school district for over half a million dollars? She flip-flopped from wanting a position of power that would enable her to help students succeed to stealing directly from those students’ supply closet, affecting their ability to access basic materials and ultimately killing their chances at success. Campbell and her daughter stepped on these kids for pure financial gain.

FBI Special Agent in Charge Robert D. Foley said it best, “the FBI would like to thank all of our partners who continue to assist us in battling corruption…The actions of these subjects do nothing more than steal the opportunity for quality education from our children. Such actions cannot be tolerated…”

Yet, the list doesn’t end with the Campbells. Here are three other disturbing cases of late:

Charles and Diana Muir were sentenced to four and a half years in prison, respectively, and forced to return the $1.1 million they stole from a 140-year-old college scholarship charity in Louisville — the Woodcock Foundation — that was run by Charles Muir. The couple then laundered the proceeds through Diana Muir’s dental business. Again, the victims are the students who receive these scholarships from the Woodcock Foundation’s annual $2 million donation.

In the southwest, Brian Brown, former president of National Relief Charities, and a co-conspirator, William Peters, were convicted of stealing $4 million from the organization. There were sentenced to 18 and 37 months in prison, respectively, and ordered to repay the pilfered funds that were intended for scholarships for Native American students. Brown and Peters used the money for personal purposes instead. So noble. The pair then attempted to launder the proceeds through tax returns.

John “Richard” Ceroni and Adale “Marie” Cernoni, founders of Carnegie Career College, were sentenced to prison terms and ordered to pay $2.3 million in restitution for bilking the U.S. Department of Education for that amount in student financial aid. They then laundered the proceeds to pay for property, vacations and jewelry. The victims in this case are part of the same class of adult students that have sued Trump University for $40 million for fraud. Everyone deserves an education. Stealing from the federal government on behalf of the school’s students to reap gluttonous rewards? Shameful.

Just as an ecosystem is changed by the disturbance of habitats and species, when the victims of crimes are students, our entire system is affected. When the rate of car accidents collectively increases we, as consumers, also see our rates increase. When thieves steal from supermarkets and grocery stores on a regular basis, the price of food in that store naturally increases. And so the victims of the crimes of the Walkers, Campbells, et. al., are not limited to the school districts they stole from or the students that they shortchanged from getting a proper education. Their crimes affect our entire education system and ultimately, our kids as well.

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