While news of the FBI probe into the Education Achievement Authority, the state run K-12 reform district, may have just come to light, the Detroit News reports that the investigation has been going on for months with bank records and emails subpoenaed last year.
According to the News, Mumford High School Principal Kenyetta “K.C.” Wilbourn, who admitted to tax evasion and bribery last week, is one of several EAA administrators who was targeted for the subpoena deep dive. Ex-Chancellor John Covington, who stepped down last year in a storm of negative press about misallocated funds, was also a focus of the subpoenas — as was chief of staff Tyrone Winfrey, Pershing High principal Gregory King, Ex-Denby high school principal Tracie McKissic, Mary McLeod Bethune Elementary/Middle School principal Antoinette Pearson, former Central Collegiate Academy principal Steven McGhee and Mumford business manager Georita Bates.
Emails between the FBI and EAA admin show current Chancellor Veronica Conforme was made aware of Wilbourn's alleged wrong doings and reported them to EAA general counsel shortly after the Mumford principal abruptly resigned in November 2014.
“She would ghost write for vendors and help them respond to RFPs and she said she reported these things to DPS conflicts of interest,” Conforme wrote in a memo to then-EAA General Counsel Michelle Crockett less than a week after Wilbourn sent her three-sentence resignation note. “She said she would also take a cut or have vendors over bill and three people for the price of one — she mentioned Esperanza on this issue.”
"Esperanza" is referring to Esperanza Detroit a company, which according to its website "provides services to over 10,800 youth each day through our innovative Student Advocate Program. " The conflict resolution program has contract with Detroit Public Schools and EAA schools, with its EAA clients being: Denby High School, Mumford High School, Pershing High School, Ford High School, and Phoenix Academy.*
Invoices show the EAA paid Esperanza Detroit $561,452 in the 2012-13 school year and $837,354 in the 2013-14 school year and over $200,000 in the 2014-15 school year.
This is not the first time Esperanza has come under fire. Over the summer it was the subject of a lawsuit filed Wayne County prosecutors, who charged Cecilia Zavala, the company's former chief operating officer, and Rudolfo Diaz, the former principal of DPS's Western International High School, with embezzlement. According to the Detroit Free Press, DPS paid Esperanza thousands of dollars to be help at-risk students, however, funds were diverted and ended up in the pockets of Diaz and Zavala.
While Esperanza has a record of questionable relationships it is just one of several vendors being investigated by the FBI in the EAA probe. According to the Free Press, Allstate Sales, World Wide Sales, Educating Hands, Gloria P. Davis, Conari Consulting and Learning Gizmos are all companies that the FBI inquired about, however, former-EAA General Counsel Crockett told them that she was unaware of the district contracting these companies. In fact, the Free Press reports that the EAA central department had no record for $1 million in invoices that went to vendors by the names of: Educating Hands, Top Flight Education, M.A.D.E. Training, Beyond Basics, Ingrid Walton and Alkebu-Lan Village.
This lack of awareness of where money was going is somewhat addressed in an email Crockett sent the FBI, explaining that Mumford's Wilbourn was contracting companies without letting the district's central office know. “It appears that she is contracting with these individuals on her own and is having them sign an old Master Service Agreement from last school year,” Crockett wrote.
However, it is important to note that Wilbourn is not the only person being investigated — nor was she the only person signing off on contracts. Bates, the former Mumford business manager, for example, was “transferred to another position” according to an email Crockett sent to the FBI, after she signed off on a vendor contract worth $500,000 — something she clearly was not allowed to do considering then-chancellor (and current FBI target) John Covington was the only person with the authority to sign off on contracts without board approval. And even then Covington was limited to $250,000 — versus the half a million Bates okayed.
The news the EAA probe comes at an interesting time. On Monday Gov. Rick Snyder announced his plans for Detroit Public Schools (we sort of got a sneak preview in August when the Freep leaked a bunch of planned bills). The plan calls for the splitting of DPS into two districts — one, the "old DPS," would be around to pay off the district's debts, but would not be in charge of educating students — and the other, the Detroit Community School District, would be in charge of educating both EAA and traditional DPS students. Under the plan, the Detroit Community School District would be run by a seven-member board with the governor appointing four members and Mayor Mike Duggan appointing three board members. So to spell that out: No, the new district would not be run by an elected board.
News of the Detroit Community School District's appointed board and the current FBI probe of the EAA — a supposed "turnaround" district that needed appointed board members to eliminate corruption — makes the plan, well to quote Snyder himself: “I think it’s fair to say it complicates it.”
**Note during the time of writing this up, Esperanza Detroit edited its website and removed the list of schools it contracts with.**