| P E Y T O N W O L C O T T |
| H o w w e t a k e b a c k o u r c h i l d r e n ' s e d u c a t i o n -- o n e p e r s o n , o n e q u e s t i o n , o n e s c h o o l a t a t i m e . Copyright 1999-2008 Peyton Wolcott |
| Bremond ISD's former supe J. Kenneth ("Kenny") Johnson, Sr. and the two families who held him accountable despite little or no help from 24 local, state & federal agencies and offices |
| #2 Trial: PLEA (06.26.06) Questions re former Bremond ISD supe Kenny Johnson's employment statement, spending, more By Peyton Wolcott - 06.26.06/2 am |
| $800,000 is still missing post-Johnson from Bremond ISD? There are serious questions regarding Johnson's exact employment status which appear to echo the case cited at bottom of this page regarding Elizabeth School District supe Bruce Bartlett who is serving six years in prison for telling his board he was earning one salary while paying himself another (more)--and there were no issues with Bartlett regarding $800,000 missing, or credit card charges in Hawaii and Arizona. And using the same logic, why should 82nd Judicial District Judge Robert Stem agree to such a plea? |
| The Yezak's and the Gadbois' started with the basics: Why when Bremond ISD was one of Texas' wealthiest districts (thanks to a local power plant) were its students not receiving commensurate educations. So the two families asked to see Bremond ISD's most recent audit, which, once they finally received it, raised more questions. Along with most casual bystanders, parents and taxpayers make an erroneous assumption regarding public education at the local level. They think someone in charge is looking out. They think those state and federal agencies with the important-sounding names are actually looking out for their kids, looking out for things financial. You know, looking out. |
| Jim James |
| Why would Kenny Johnson be using Bremond ISD's credit cards at WalMarts in Arizona, Iowa--and Hawaii? PROVISO: I'm a big fan of WalMart. When we moved to the country, our neighbors told us, "If you can't find it at WalMart you probably don't need it," and they were right. However, I am very puzzled as to why a Bremond, Texas school superintendent ran up $22,230.89 worth of charges on his Bremond ISD credit cards, including WalMarts in Hawaii (Kaille Kona, $109.94) and Arizona (Phoenix, $82.75). Oh, and Iowa (Corydon, $53.04). Not to mention Texas charges in Austin and San Antonio and College Station. |
| What was Kenny Johnson's employment status May-Oct. 2003? To say Johnson's exact status with BISD for the last months of his tenure is unclear is generous. Further, the January 2004 audit found Johnson had been paid $348,639.44 versus the $307,921 amount stipulated in his employment contract. (More below in dark pink box.) There is a general ledger entry for Sept. 14, 2003 showing a $5,000 appropriation out of code 701 (the supes' code) for "professional services." Further muddying the salary waters is the auditors' finding that Johnson retired in mid-May 2003 from Bremond ISD--earlier than some officials' understanding that his retirement date was July, and that he continued working at the district as a JR3 employee (JR3 Education Associates, LP), as a "retire/rehire." JR3 has not responded to queries regarding his status at BISD as their employee. Superintendent Johnson himself responded (on Sept. 25, 2003) to a public records request for his contracts (dated Sept. 10) by forwarding some "Multiple-Year Term Contracts" with the last one dated April 16, 2003 and the amount only as "4% salary increase" in addition to perqs. He furnished no JR3 employment contracts. |
| Hudson Anderson BIDS audit Bremond ISD's long-time auditors Hudson Anderson of Corsicana reported in January 2004 that Kenneth Johnson had $137,525.56 in "questionable expenditure" and $137,344.75 in "reimbursable expenditure" for the period Jan. 1999 through Aug. 31, 2003--only four years of Johnson's ten years at the helm of the district. This means that Johnson charged $275,000 on Bremond ISD credit cards in just over four years, charges that were considered by the auditors either questionable or reimbursable. It should be remembered that as most BISD business records disappeared from the district the same week Johnson resigned, the auditors experienced difficulty conducting this audit. |
| SPECIAL PROSECUTOR JIM JAMES: James is prosecuting Johnson only on the "over $100,000 and under $200,000" amounts indicated in the State Auditor's report. STATUS: Kenneth Johnson's plea deadline is Monday, June 26 at 9:30 a.m. in the Robertson County courthouse in Franklin, Texas. |
| FEDERAL BUREAU OF INVESTIGATION WACO FIELD OFFICE - SPECIAL AGENT LESLIE (LES) LEDGER, JR. When Robert Gadbois contacted the FBI during the fall of 2003, Ledger told him the FBI didn't get involved until the Texas Rangers were ready for them, and that the Rangers did all the legwork for the FBI. STATUS: As of June 21, 2006 the FBI does not show Bremond ISD on their case list. |
| TEXAS GOVERNOR RICK PERRY Perry was the first cc on the State Auditor's Office report on Bremond ISD dated Sept. 23, 2005. STATUS: No response received. |
| OFFICE OF THE TEXAS ATT'Y GENERAL "Attorney General Greg Abbott is the lawyer for the people of Texas and is charged by the Texas Constitution to: defend the laws and the Constitution of the State of Texas represent the State in litigation." (SOURCE--OAG website) STATUS: No response, no follow up. |
| U.S. DEP'T OF EDUCATION INSPECTOR GENERAL DALLAS-SPECIAL AGENTS SUSAN SCHMIDT, NEAL SANCHEZ Schmidt and Sanchez traveled to Bremond in Oct. 2005 to meet with the Bremond moms. When contacted this week for comments, Schmidt said, "We're not allowed to comment on anything." When asked about BISD's TIF grant application the Bremond moms had given her last October, she said, "We're not allowed to release anything." Although it's been eight months since she and Sanchez came to Bremond neither has followed up in any way including keeping their promise to return the materials the moms gave them obtained through public records searches. Washington- CATHERINE GRANT, USDOE INSPECTOR GENERAL LIAISON This week: "How we operate is we don't discuss any ongoing work." When I asked whether it could be possible that the USDOE was no longer actively working on this case and was preparing its report, Grant repeated that they won't discuss ongoing work. (Apparently even if it's being paid for by taxpayers, and even if "ongoing work" can be construed only in the most Clintonesque sense.) STATUS: Although Grant characterized this as "ongoing work," an email from Harold Burns of the state auditor's office tells a completely opposite tale (at right). |
| BREMOND ISD'S CURRENT SUP'T TIM PETERSON "We've worked with the proper authorities," he said June 23, 2006, "and we've done what has been requested, and that's where we're at." UPDATE: By Oct. 2006, Tim was employed by Harmony Community Schools in his native Iowa and Bremond ISD had hired another interim supe. |
| Bremond ISD (Robertson County, Texas) |
| STATE AUDITOR'S OFFICE JOHN KEEL, STATE AUDITOR PAMELA MUNN, MANAGER-SPECIAL INVESTIGATIONS UNIT; HAROLD BURNS, SPECIAL INVESTIGATOR The SAO's Special Investigations Unit report re BISD was issued nine months ago today, long enough to produce a baby; this report was addressed to "Members of the Legislative Audit Committee" and cc's were Governor Rick Perry, Texas edu-missioner Shirley Neeley, Robertson County DA John Paschall, special prosecutors Jim James and Craig Greening, and Texas Ranger Jim Huggins. No copies were sent to either the Bremond ISD board or superintendent,and no copies were sent to any of the parents who began the investigations. The report only mentions the special prosecutor's indictments against Johnson, including ""theft of $100,000 or more, but less than $200,000, by a public servant (a first degree felony)" and "misapplication of fiduciary property of $100,000 or more, but less than $200,000 (a second degree felony)" along with the lesser charges against former BISD business manager Sandra Nolan, and Johnson's son Jason. The SAO report states, "the investigation revealed that, from 1998 through 2003, Dr. Johnson and Ms. Nolan allegedly misappropriated and misapplied BISD funds totaling more than $158,000." STATUS: The SAO appears to now be out of the loop as Burns did not know about Johnson's June 5 pre-trial hearing. |
| BREMOND ISD AUDITORS HUDSON ANDERSON For for 8-10 years BISD's auditors cited "uncollateralized deposits at local bank" (First State Bank of Bremond); during some of this period BISD trustee Kenneth Swick was both president of the BISD school board and president of First State Bank of Bremond. FINDINGS: According to an audit approved on Nov. 6, 2003 by Kenneth Swick as BISD board president, the dozen specific areas the auditors were to examine included: 3. Depository Contract 6. Superintendent Compensation 12. Cafeteria Deficit (Continued below, pink box) |
| UNITED STATES DEP'T OF AGRICULTURE INSPECTOR GENERAL How the USDA could have become involved: the district's cafeteria fund accepted free lunch money (from the USDA); according to district officials, monies in this account were commingled with funds for purchasing food for the district's sports concession stands; once the concession stand food was sold, the money did not make its way back into the cafeteria fund, hence the commingling STATUS: The USDA's communications liaison is looking into Bremond ISD's standing with them, if any. |
| STATE AUDITOR'S OFFICE SENIOR INVESTIGATOR HAROLD BURNS EMAIL, JUNE 5, 2006 TO BREMOND CITIZEN "You know way more about what is happening with the case than I do. The first I heard from anyone was last Thurs. when I got a call from U.S. Dept. of Ed OIG Special Agent Susan Schmidt. She said she understood that Johnson and his lawyer were meeting with the special prosecutors - no mention of a pre-trial hearing. Susan said the Feds are not moving forward with their case because Johnson is going to enter a plea on the State charges. No idea what has been worked out as far as restitution, sentence, etc. Ranger Huggins had not heard anything about it until I called him. We were not asked to be at the hearing. Thanks for the information. At least now I have some dates to be aware of. I guess I'll have to get a subscription to the Bremond paper, so I can find out what happened. " FOLLOW UP: This is interesting in light of the USDOE's description of the case's status as "ongoing." |
| ENVIRONMENTAL PROTECTION AGENCY-- USDOE special agent Susan Schmidt told the Bremond moms during their Oct. 2005 meeting that she'd contact the EPA re the status of the location of some of the district's allegedly missing computers. STATUS: No further contact from Schmidt or EPA. |
| TEXAS DEP'T OF BANKING ???? |
| /82nd JUDICIAL DISTRICT COUNTY & DISTRICT ATT'Y JOHN PASCHALL The Bremond parents filed a complaint with Paschall's office on Oct. 22, 2003 "for apparent violations relative to the timely and complete release of public information," saying they had "made numerous requests" to BISD for public information, and that "the District has consistently failed or refused to provide the information requested and has provided no ruling from the Attorney Generla stipulating why the information was withheld." Six weeks later (Dec. 9, 2003), Paschall responded that he believed "a conflict of interest exists that would preclude the Robertson County District Attorney's Office from bringing civil enforcement litigation against the B.I.S.D. because such litigation would hinder the ongoing criminal investigation" which is "being conducted by Texas Ranger, Jim Huggins and the State Auditor's Office concerning employees" of BISD. STATUS: Paschall states in the letter that the Gadbois may file a complaint with the Office of the Attorney General, and cc's Brandy Byrd of the OAG. FOLLOW-UP: Because of the conflict of interest, special prosecutor Jim James was brought in from Bryan-College Station to prosecute Kenneth Johnson and his son. |
| Pastoral scene five minutes from Bremond ISD |
| TEXAS RANGERS CAPT. DANBY on investigation by Ranger Sgt. Jim Huggins: "Our job is to determine if a criminal offense occurred, and find and present that evidence. To try to determine the entire amount, that's the job for the auditors. I don't know whether the recovery of every penny is a civil matter or a matter for restitution if the auditors have the ability to reconstruct the bills and the flow of money. Don't take it that we're not caring; the plea is the discretion of the prosecutor; this is the way our justice system is set up. The prosecutor did not try for a change of venue." Of Huggins, Danby said, "I am confident in his ability." SERGEANT HUGGINS to Bremond moms regarding the disappeared paper records: "There's not anything that's ever been done on paper that I can't get a copy of. Don't you worry, I've got it now. Basically I want you to stop [investigating]. I can't tell you to stop, I can't ask you to stop, but we've got it. You could hinder my case." |
| FORMER BISD BOARD PRESIDENT KENNETH SWICK, OTHER TRUSTEES Voted out of office in May 2004 along with two other veteran Bremond ISD trustees in favor of two of the investigating Bremond parents (Pat Yezak and Robert Gadbois), Swick and fellow trustees did not follow through during their tenure to investigate any of the information being uncovered by the Bremond parents, saying he was guilty of trusting Johnson too much, and says now he wishes TEA and other agencies had been more helpful, particularly with the findings of the district's annual audits. "Either Dr. Johnson paid off the auditors and they didn't do their job, or TEA didn't do their job, and the state board of accountancy said, 'Let's sweep this under the rug.' " Swick asks "why didn't the audit firm find 6,000 transactions that Johnson made that were inappropriate-- and the auditors failed to find any of them and report them to the board." Swick also takes issue with TASB's "Team of Eight" board trainings, pointing out that "one of the primary things told to us was that the superintendent is a professional, he's involved, and he's in control, and that you're there to help him out. I agree there should be a separation of power." STATUS: For 8-10 years during Johnson's tenure, audit finding stated that Bremond ISD funds were deposited unsecured in the First State Bank of Bremond--of which Swick was also president. FOLLOW-UP: In BISD's Aug. 2003 board minutes, rather than recusing himself, Swick voted for his bank's own contract. A revote was taken in October at which time he abstained. |
| U.S. ATTORNEY Although because federal money is a factor this office could have been involved, it has not been as the Texas Rangers did not ask the U.S. Attorney to participate, per a spokesman. |
| STATE BOARD FOR EDUCATOR CERTIFICATION James Kenneth Johnson's online SBEC certification page only states, "Click here to go to EDUCATOR SANCTION HISTORY section" which leads to "Note: This individual is currently under review by the SBEC Professional Discipline Unit." There is no statement regarding when the review began, no statement regarding the progress of the review, and no statement regarding the cause of the review. |
| TEACHER RETIREMENT SYSTEM On which salary will Johnson's retirement be based? The $86,000 the board approved--or the almost $108,000 that he actually paid himself for his last 3 years of employment at BISD? STATUS: Unknown. |
| INTERNAL REVENUE SERVICE Did Johnson report the extra $22,000 or whatever amount he received as income to the IRS for each of his last three years? What about the questionable credit card expenses? STATUS: Unknown. |
| FEDERAL DEPOSIT INSURANCE CORPORATION STATUS: ??? |
| TEXAS EDUCATION AGENCY LINDA FREDLUND, AUDITOR-SCHOOLFINANCIA L AUDITS DIVISION Fredlund wrote the Bremond parents on Oct. 2, 2003 that she was forwarding their concerns "involving misuse of public funds and violations of the Public Information Act" to the Robertson District Attorney's Office and to BISD's external auditors, Hudson Anderson & Associates, PC "for follow-up during the 2003-2003 annual financial audit." Fredlund continues, "I spoke with Mr. Frank Marx, III, today regarding the allegations, and he assured me that the audit firm would review and consider this information while conducting the fiscal year 2003 annual financial audit." She concludes, "In order to avoid duplication of effort, and due to limited staff, we are considering this file closed; however, we will assist law enforcement if requested. Thank you for being concerned citizens." |
| Old Bremond School, now abandoned |
| ROBERTSON COUNTY SHERIFF GERALD YEZAK When all four Bremond parents went to the sheriff, he responded that he did not have the funds to become involved, and the parents should give the situation to the Texas Rangers who had recently cleaned up Texas A&M's accounting problem (Oct. 2003). STATUS: Sheriff Yezak called in the Texas Rangers, who called in Harold Burns of the State Auditor's Office, who traveled to Bremond to investigate, then produced the Sept. 23, 2005 report (above) which was not disclosed to the school district or its trustees. |
| Entrance to old BISD athletic field |
| How did Bremond ISD come to have misplaced $800,000? BISD's former supe James Kenneth Johnson apparently used a variety of means including district-issued credit cards to treat himself and his family and some employees and other district officials to lavish trips and other entertainment over several years. For example, "in 2001, one credit card collected more than 30 charges in Hawaii and once was used to collect more than $1,000 of 'game cash' in Las Vegas." (SOURCE--AP) Many other details are missing because the district's business records disappeared the same week Johnson resigned in 2003; he was indicted last fall and is expected to be in court this Monday for his plea bargain. The missing $800,000 reflects the mysterious drop in BISD's fund balance discovered after Johnson's departure. Perspective: Bremond ISD is a small district in a town with only 900 people and a county with only 15,000 people; it's only thanks to the local power plant that the district has any real money. |
| HUDSON ANDERSON AUDIT FINDINGS, cont'd (Jan. 2004) 3. BISD Depository contract [First State Bank-Bremond] Bremond ISD's District Policy BBFA "provides as follows: "BANK RELATIONS: A trustee who is a stockholder, officer, director, or employee of a bank that has bid to become a depository for the District shall not vote on the awarding of a depository contract to said bank." Education Code 45.204: "If a Trustee has a substantial interest in a bank with which the District is considering entering into a loan or other transaction besides a depository contract, then the Trustee must comply with the affidavit and abstention requirements. Atty. Gen. Opn. JN-1082 (1989)." With the two cites in mind, the auditors report: "We inspected the board minutes from the August 20, 2003 meeting and noted that Mr. Swick [then BISD board president and also president of First State Bank of Bremond] voted for the extension of the depository contract [with First State Bank of Bremond]. We also reviewed the minutes from the October 22, 2003 meeting, noting the board again approved the extension, and Mr. Swick abstained from voting." NOTE: This bank "converted to a state savings bank under title of First State Bank-Bremond, S.S.B., on 8-01-2004." (SOURCE--Texas Dep't of Banking) |
| WILL FORMER BREMOND ISD SUPE JOHNSON BE ABLE TO WALK AWAY FROM THE MISSING $800,000? Kenneth Johnson leaves Franklin courthouse on June 5 after attorney no-showed at pre-trial hearing. |
| Nancy Gadbois recollects on her website www.Nancysblog.com When we tried to contact the authorities put in place by the state of Texas, such as the Texas Education Agency, to report the possible wrongdoings in our school district we were met with opposition and no support. Our school district has been cited in their audits for the past eight to ten years for unsecured funds in the bank yet to my knowledge not one agency has ever followed up to see if anything had ever been corrected. |
| LETTERS FROM MAURICE & PAT YEZAK AND ROBERT & NANCY GADBOIS TO THEIR U.S. SENATORS, KAY BAILEY HUTCHISON AND JOHN CORNYN, AND CONGRESSMAN CHET EDWARDS REQUESTING A CONGRESSIONAL INQUIRY/HEARING [EX. CORNYN] After almost three years of waiting, it appears that Dr. Kenneth Johnson, former superintendent of Bremond ISD, is going to agree to a plea bargain for his part in the theft of hundreds of thousands of dollars from our school district on Monday, June 26, 2006 in Robertson County 82nd District Court with Honorable Judge Stem presiding. The “unofficial word” is that the plea includes a 5- year prison term and restitution of an additional $70,000. (He has paid back $130,000 to date) Please allow me to share a bit of history. We, Robert and Nancy Gadbois, and friends, Patricia and Maurice Yezak, began making open records requests to our school district administration in the summer of 2003. Bremond is a small district of about 450 students. The Board of Trustees had just approved a $7.9M budget on revenue projections of $4.3M. The State’s AEIS reports indicated spending of more than $14,000 per student. Rumors of exotic vacations by our superintendent were floating around along with a number of other interesting allegations. Here is a small sample of what our open records requests appeared to reveal: Dr. Johnson paid himself an additional $20,000 in salary. Dr. Johnson also wrote himself checks each month that averaged $1,000. Dr. Johnson used district credit cards for hundreds of thousands of dollars in personal expenses, including trips to Las Vegas, New York, Hawaii, Jamaica, Cancun and elsewhere. Charges included tens of thousands of dollars in jewelry, sports memorabilia and clothing. A review of all of the charges is sickening. Dr. Johnson placed two of his sons on the district’s payroll and enrolled them in the district benefit plans, though neither of them worked or even lived in the district. Dr. Johnson used district checks to pay for personal expenses, including groceries, insurance, utilities, medical care, travel, building supplies, vehicle repairs, and the list goes on. After our discovery, we turned over our documents to the TEA. The TEA informed us that they did not have the manpower to pursue it and in turn forwarded the information to the State Auditor and the local District Attorney. The local District Attorney would not pursue it as he had a conflict of interest. The local sheriff also said he did not have the manpower and put us in contact with Texas Ranger, Mr. Jim Huggins. We contacted the FBI, and were told that we really needed to just stick with the Rangers. A “special audit” commissioned by the Board of Trustees confirmed our findings. This was not a forensic audit. Unfortunately, the audit consisted of reviewing the documents we had already discovered. The auditor simply interviewed Dr. Johnson and with our list of charges in hand let him choose what he felt he was responsible for. Of almost $500,000 in American Express and US Bank credit card charges over 4 years, Dr. Johnson claimed responsibility for $190,000. However, over $200,000 fell into the “unknown” category. The audit did not include a review of checks written over the same 4 years or credit cards such as Texaco, Wal-Mart and Lowes. All files and receipts that could have been used to prove the misuse of funds were shredded or removed prior to and after Dr. Johnson’s resignation. Now let me explain the reason for our letter. Mr. Cornyn, we are being told by the special prosecutor “all he needs is $100,000” and he’s got a 1st degree felony. He has also stated that the county doesn’t have the resources to investigate all of the allegations. Therefore, we should be happy with the plea bargain. Mr. Cornyn, since Dr. Johnson’s resignation, the district’s expenditures have dropped from an average of $500,000 per month to an average of $350,000, well over $1M per year. Virtually all of the district’s financial records, prior to Dr. Johnson’s departure, have been destroyed. Accordingly, we have little evidence of what the money was spent on. We have some idea, based on the credit card statements we’ve seen. The district has had to rebuild its budget based on bank statements and personnel files. We were led to believe that law enforcement would use their subpoena power to find the extent of the misuse of funds. Now we know that they simply took what we found, took what Dr. Johnson claimed responsibility for and ran with it. We do know that our cafeteria was showing a loss of well over $100,000 per year prior to Dr. Johnson’s resignation. We know that food for our concession stand was paid for with cafeteria funds. We know that we receive about $10,000 per month in federal aid for our free and reduced lunch program. Our federal funds were not kept separate from our local, state and county funds. These funds were deposited together in the Local, State and County account. We were told at one point by the Department of Education, Office of the Inspector General, that if Dr. Johnson commingled the funds that it was a federal offense. Now we find that, from a federal perspective, the case is not “sexy enough.” Mr. Cornyn, the district is out hundreds of thousands, if not millions of dollars. Each and every governmental agency we’ve turned to have either passed the buck or claimed that due to limited resources won’t pursue the investigation to the full extent. So we’re left with an individual that raped this small community, facing only possible probation, and forced to pay back a small portion of what he appeared to steal. We are asking for your assistance in engaging federal and perhaps even local law enforcement to reassess our situation. Unless individuals like Dr. Johnson are investigated and punished to the fullest extent, this type of misuse of public funds will continue to destroy our education system. We would even be willing to participate in a Congressional Hearing to discuss the challenges and barriers we’ve had to overcome in our search for information and in our effort to expose the wrongdoing in Bremond. I know we’re not alone. Your assistance in helping us to seek justice would be sincerely appreciated. Thank you in advance for your consideration. Respectfully, Robert and Nancy Gadbois Maurice and Patricia Yezak |
| HUDSON ANDERSON AUDIT FINDINGS, cont'd (Jan. 2004) 6. Superintendent Compensation. "We analyzed all contracts for the superintendent to determine the basis of his District approved compensation. Contracts for fiscal year 1995 and fiscal year 1999 were originally unable to be located. Fiscal year 1999 was subsequently found by the business manager. The contracts contained typed-in information, and the fiscal year 1999 contract reported an 8.5% increase. Normal increases during his tenure wee 3% to 5% annually. Payroll records reflect that beginning in February 2000, Dr. Johnson began receiving immediate increases for the upcoming contract year dated to be effective in July. In February 2001, Dr. Johnson received a 7% increase; however, the upcoming contract had authorized a 4% increase effective in July. As a District employee during the period analyzed [years ended 2000-2003], Dr. Johnson's contracts totaled $307,921. Per payroll records, the actual amount paid during this period was $348,639.44. The total overpayment based on these records is $40,718.44. "During the period May 16, 2003 through August 31, 2003, Dr. Johnson was paid through JR3 Education Associates, LP, with reimbursements to JR3 from the District. During that period his compensation agreement was not agreed to in written form. Per inquiry of [then-BISD board president] Mr. Swick, the District's understanding of his compensation was that no benefits would be paid, with gross compensation totaling the same as his last contract amount before termination. Based on these amounts, Dr. Johnson's compensation package for the three and one half month period should have been $24,236.63. During this period, his actual compensation totaled $34,117.92. The total overpayment based on these records is $9,881.29. "The superintendent and business manager did not adhere to proper internal control procedures during the processing of these transactions." |
| HUDSON ANDERSON AUDIT FINDINGS, cont'd (Jan. 2004) 12. Cafeteria Deficit. We analyzed expenditures for the cafeteria and inquired of cafeteria personnal, and noted no apparent personal use of District food products by the superintendent's wife [who was still cafeteria manager at the time of the questioning]. |
| NANCY GADBOIS STATEMENT: As far as we know, Jim James got his information from the State Auditor and the Ranger. We compared the special audit numbers with the numbers we had from our open records requests. In comparison, it appears Dr. Johnson’s indictment charge totals are close the information we had already provided and not more. Since I don’t have access to the same information the State Auditor and the Texas Ranger have, I can only speculate. The special audit notes $137,525.56 in questionable expenditures and $137,344.75 in reimbursable expenditures. Were these “questionable expenditures” ever investigated? I don’t know but added together it totals more than $200,000. The special audit did not include information obtained later such as Wal- Mart statements which show charges in other states such as Hawaii. The audit also failed to investigate an endless string of checks signed by Dr. Johnson and Sandra Nolan. |
Personal comment I would like to express my personal and heartfelt gratitude to the Bremond parents (Maurice and Pat Yezak, and Robert and Nancy Gadbois) for sharing the public records they obtained through their Texas Public Information Act requests, making them available to all, and for their generosity of spirit in sharing this information for the common good. --Peyton |
FROM TEAM OF EIGHT TO TEAM OF ONE Former Bremond ISD supe Kenneth Johnson leaving courtroom after June 5, 2006 pre-trial hearing in Franklin, Texas. Neither Kenneth Swick nor any of former superintendent Kenny Johnson's "Team of Eight" members made it to the pre-trial or to the trial and sentencing. |
| QUESTION: Was James misquoted? Did James actually mean to tell the reporter that if the burglar says "Here's one-fifth of your TV back" then he gets off on an easy plea deal? Getting to keep four-fifths of the TV doesn't sound like Bremond taxpayers are being well served by the judicial system, small-town, small-potatoes or not. Like I always say, not many of us write that many $800,000.00 checks out of our personal accounts each day of the week. QUESTION: Under former supe Kenneth Johnson, Bremond ISD's cafeteria operation was losing $70,000-80,000 per year because apparently they were buying all concession stand supplies (for football games and other sports) through the cafeteria but never reimbursing the cafeteria once the food was sold. Because the cafeteria received federal so-called free lunch funds, wouldn't this be a clear case for the feds thanks to the commingling? |
| Relevant examples of school personnel facing and serving time, other penalties for embezzling far lesser amounts than the $800,000 missing under former Bremond ISD supe Johnson's watch; date of this study: 2006 |
| Mickey Heath, former business manager at Boone School District (IA), pleaded guilty on Monday to a felony charge of theft. The charge comes in connection with the disappearance of $15,000 in school district funds. A state audit connects Mickey Heath to over $200,000 in missing money from the time of his hiring in 1997 until November of 2005. Heath faces up to 10 years in prison and a $10,000 fine. (SOURCE--KWBG.com) |
| Former Hulbert (OK) Public School District treasurer Deborah Harvey has confessed to embezzling nearly $37,000 from her Oklahoma district by altering payee names on checks. Charges are expected to be filed next week. (SOURCE-- D.E.Smooth/Muskog ee Phoenix) |
| Former Elizabeth School District (CO) supe Bruce Bartlett (above) is serving six years in prison for telling his board he was receiving $123,000 per year salary but actually paying himself $166,632. (PHOTO/KCNC) How the story broke "Jack Dixon, a local mortgage broker, became curious and did some rooting around in the district’s financial records. He asked to see the employment contracts for Bartlett and Munsey, but was initially told to get lost. When it became apparent to the board members that they were going to be on the losing end of an embarrassing Public Records lawsuit, Dixon was finally shown a copy of each contract. At a subsequent board meeting, Dixon revealed that Bartlett and Munsey had actually been paying themselves $190,000 and $120,000 respectively. The shocking revelation about salaries sparked a complete examination of the district’s financial records, uncovering a $2.25 million shortfall." (SOURCE/Cheyenne Herald) |
| Former San Jose (CA) school secretary Barbara Jo Price (above) (PHOTO--Mike Janes/Almaden Weekly) was sentenced last December to three years in state prison "for embezzling more than $480,000 from the school's student activity fund from 1998 until January of this year. Barbara Jo Price, 44, worked at Bret Harte Middle School in San Jose's tony Almaden Valley neighborhood for 12 years until district auditors discovered her embezzlement in January. In addition to her prison sentence, Price was ordered to pay more than $700,000 in restitution although Santa Clara County Deputy District Attorney John Chase does not know how much of the embezzled funds will actually be recovered. 'This was stolen over a long period of time, beginning in 1998, so most likely it's been spent,' Chase said. Price has been in custody since June. (SOURCE--KGO TV) NOTE: Price is currently serving her time in Elmwood Correctional Center for Women in Milpitas, California. (SOURCE/KSCO) |
| Bartlett's too-trusting and/or complicit school board "An investigation by the school district prompted by a News 4 investigation revealed inflated salaries, reckless money management and questionable credit card and cell-phone charges all undetected by a trusting school board." (SOURCE--KCNC TV) "At the sentencing, the Judge directed some particularly harsh words toward the members of the school board for their failure to detect the ongoing fraud and their obvious practice of blindly rubberstamping everything which came before them." (SOURCE--Cheyenne Herald) |
How we take back our children's education: one person, one question, one school at a time. |
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| Bremond ISD's Kenny Johnson update, August 2008: Superintendent James Kenneth ("Kenny") Johnson, Sr.'s journey from earning an education doctorate at Texas A&M to a stint as Bremond ISD superintendent included taxpayer-funded trips to Cabo, Hawaii and jewelry stores; these aspects of his journey landed him in the Robertson County Courthouse two summers ago. He next resided in state prison from 2006 to 2008 where he collected his TRS retirement, the amount based on salary fig- ures he himself claimed; having served his debt to society, Kenny has been released from prison and will be on probation until 2011, all the while continuing to collect his TRS. |
| Kenny Johnson |
| Nancy Gadbois (L) and Pat Yezak (R) Robertson County Courthouse - 2006 |
| Bremond ISD parents update, June 2008: Nancy and Robert Gadbois and Pat and Maurice Yezak started asking questions four years ago then filed their first Texas Public Information Act request for a copy of the district's budget. Robert Gadbois and Pat Yezak each served on the BISD board; both couples still live in Bremond where their children still go to school. |
| MONTHS & YEARS OF QUESTIONS |
| PRE-TRIAL, TRIAL & PRISON |
| 24 LOCAL, STATE & FEDERAL AGENCIES AND ENTITIES INVOLVED (as of June 2006) |
| What kind of local culture would allow the district to deposit its funds unsecured in the then-BISD board president's bank? Why were BISD funds deposited unsecured in the bank -- |
| SENATORS JOHN CORNYN & KAY BAILEY HUTCHISON, REPRESENTATIVE CHET EDWARDS The Bremond parents have requested a Congressional inquiry/ hearing from each of these three to look into the missing $800,000 among other amounts. STATUS: Awaiting response. READ THEIR LETTER BELOW. |
| In 2003, in Bremond ISD (population: 876), Pat Yezak and Nancy Gadbois, |
| "a couple of curious, stay-at-home moms in this rural community, used the state's open records law to find out how their school tax dollars were being spent. They got more than they bargained for: the indictment of the former superintendent, one of his sons, and the district's former business manager on theft charges." (SOURCE--Diane Jennings/Dallas Morning News) |
| Bremond ISD is a small (450 students) district in central Texas considered property rich thanks to a power plant within its boundaries; during Johnson's leadership the district's expenses were in the $500,000-550,000 range per month and according to district officials dropped to $350,000 the day he left. Johnson was indicted last fall for theft and misapplication of fiduciary funds charges including use of district credit cards to pay for jewelry, alcohol and vacations to Hawaii, Cancun and California. James told the Waco Tribune-Herald's Tommy Witherspoon last year that "Johnson has paid back a portion of what he supposedly stole, but that doesn't erase the crime. 'If you catch a burglar in your house and he says, 'I'm sorry, here's your TV back,' that doesn't undo what's been done.' " |
| #1 Pre-Trial (06.05.06) If everything former superintendent Kenny Johnson did while he was running Bremond ISD was on the up and up, why did he cover his face with his hand when leaving the courthouse after his preliminary hearing? The next time he left the courthouse -- later that month -- it was in handcuffs, on the way to prison (photo below). |
| Where was the FBI? o Why didn't the FBI investigate the fed funds? o Why didn't the FBI investigate the missing financial paper records and computers that disappeared from BISD the week after Kenny resigned? |
| 08.07.08 UPDATE RE KENNETH SWICK'S BANK: This is interesting: The First State Bank of Bremond has a new name, "First Star Bank SSB," as of August 1, 2004. And as of today, according to Texas Comptroller Susan Combs, First Star Bank SSB "had a recent filing deadline and as of this date, August 7, 2008, the taxable entity's account status has not yet been updated." Additionally, there is no officers and directors information on file. |
| then known as First State Bank of Bremond -- of which Kenneth Swick, the then-BISD board president, was also the bank president? And why were Bremond ISD's funds allowed to stay unsecured at FSBB for 8-10 years of Kenny Johnson's tenure as BISD superintendent, after audit findings stated that Bremond ISD funds were dep-osited unsecured in the First State Bank of Bremond? |
| Where's the missing $800,000 fund balance -- and BISD's paper financial records? What happened to the $800,000 of Bremond ISD's fund balance that disappeared when Kenny Johnson resigned from BISD? Where did Kenny deposit it? There are many rumors about what happened to the district's paper financial records including first-hand eyewitness reports of seeing large black plastic trash bags leave the admini- stration building under unusual if not odd circumstances. |
| First State Bank of Bremond -- now First Star Bank, SSB |
| Kenny Johnson leaving Robertson County Courthouse after pre-trial hearing, June 5, 2006. |
| Why should Special Prose- cutor Jim James offer Kenneth Johnson a plea deal this morn- ning given that |
| #2 Trial: SENTENCING Former Bremond supe sentenced to 5 years in prison; pleads nolo contendre By Peyton Wolcott - June 26, 2006 |
| Robertson County Courthouse |
The correct response to this is, in a word, hah. Among the questions they began asking -- many of which are still unanswered: |
| Three years after Bremond ISD parents Maurice and Pat Yezak and Robert and Nancy Gadbois began asking questions and eventually filing public records requests under the Texas Public Infor- mation Act in order to learn more about their school district's finances-- inspired by rumors of lavish trips and meals by district personnel-- their former superintendent, James Kenneth Johnson, was brought to justice and sentenced this morning to five years in prison by 82nd Judicial District Judge Robert Stem. Johnson's first stop: Huntsville According to law enforce- ment officials, Johnson's first stop will be prison in Huntsville for processing and observation, most likely a one- to two-week stay. |
| Kenny Johnson leaving courtroom in handcuffs |
| June 26, 2006 statement by Robert & Nancy Gadbois: We were led to believe early on in the investigation that law enforcement would use their subpoena power to find the extent of the misuse of funds. In spite of everything we found, we now know they simply took what Dr. Johnson claimed responsibility for and ran with it. The district is out hundreds of thousands of dollars. Each and every governmental agency we’ ve turned to have either passed the buck or claimed that due to limited resources they would not pursue the investigation to the full extent. It appears no further investigation was pursued even though more evidence existed such as credit card statements from WalMart, Lowes and Texaco and at least four years of checks. We are pleased Dr. Johnson will serve time in prison. We are disappointed in local, state and federal authorities for not investigating all the leads we provided them. |
| Kenny Johnson still in handcuffs en route to prison from court |
| #3: PRISON - Huntsville (2006-08) |
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| #4 - TODAY - Summer 2008 |
| Kenneth Johnson served less than two years of a five year sentence; he has been released from prison and is again at liberty -- and collecting his taxpayer-funded TRS retirement, which is based on income he himself declared. The $800,000 is still missing from Bremond ISD. Reportedly, Bremond ISD's former superintendent is living in reduced circumstances. |
| Track coach investigated after team lock-in posted by: Dan Boniface written by: Nelson Garcia 9 News.com March 9, 2008 ELIZABETH – It was supposed to be a bonding experience, at Elizabeth High School, when 40 boys and girls from the track team spent the night in the school. Instead, when it was all over, the track coach resigned his position and was placed on paid administrative leave from his teaching job. District director of instruction and future superintendent Paul Dellacroce is in the middle of an investigation into violations of school guidelines and says he is taking the incident very seriously, acting quickly to uncover what happened the night of February 22nd at the school. "The sponsor allowed students to have boxing," said Dellacroce. Dellacroce says the track coach, identified on the school Web site as Carl Olson, allowed students to fight each other wearing boxing gloves and allowed them to use Airsoft pellet guns shooting at each other inside the school. "The sponsor allowed those, they weren't snuck in by the students. They were allowed in by the sponsor where they were used at school," said Dellacroce. "That is an expellable offense for students. However, we are not gonna expel students for being given permission by a sponsor." Dellacroce says the track coach did not provide separate areas for boys and girls to sleep. He says some students also had alcohol and were drinking inside the school. "The sponsor was not aware of that," said Dellacroce. This is a town that's been frustrated with the district. Parents Bob and Karen Tackwell say people have become disgruntled after former Superintendent Bruce Bartlett and former Chief Financial Officer Nancie Munsey embezzled more than $120,000 between 2000 and 2002. Then, last year, teacher Darcie Esson was charged with having sex with a student – and now this. "That's more of my frustration is where we've heard it from is the kids," said Bob Tackwell. "We don't have any letters home from school yet." The Tackwells have two kids at Elizabeth High; neither is on the track team. They say they've been working with the district to find ways to solve problems and avoid issues like the lack of supervision at the track team lock-in. "Putting boys and girls together and not enough supervision, I think the school district has to evaluate what they're doing when they set up one of these functions," said Bob Tackwell. Karen says not enough parents are involved in district activities and that may have been a factor that night. "It is troubling to me. It's also troubling to me that if parents were going to let their children be involved maybe they should be there to help things be more supervised," said Karen Tackwell. The Tackwells say they've been meeting regularly with the Elizabeth High School principal to discuss how to get more parents involved and how they can help. "He's wanting to make a change, but he's gonna need a little bit of support," said Bob Tackwell. Dellacroce says this is not something the district needed. "For me personally, it is very troubling cause we try to do positive things for our students and we don't want this to end, these types of activities to end," said Dellacroce. "You know that is a concern what image we're putting forward." The investigation is supposed to wrap up this week. Though he resigned his position as coach, Olson is also a social studies teacher at Elizabeth Middle School and is currently on paid administrative leave until the district decides what to do with him. Dellacroce says the students who brought the alcohol may be punished, but the ones involved in the boxing and who had pellet guns will not since they were given permission by the coach. He says no students were injured. The Tackwells hope the community can rally around this latest incident and turn things around for the Elizabeth School District. "With the parents help and the kids help, we can all become that strong community again, we just need to get it together," said Bob Tackwell. |
| Elizabeth School District's problems continue - 6 years later |
