Cairo Association of Teachers - Newsletter

CAT Tracks for October 6, 2005 EMBEZZLEMENT ROCKS DISTRICT

Greed is a terrible thing...and sometimes a family thing. But...$11 million...and building a house on the District credit card?

From today's New York Times...

A Suspicious Clerk and a School Scandal

By PAUL VITELLO

MINEOLA, N.Y., Oct. 5 - It was a clerk at a Home Depot store in Selden, on Long Island, who raised the first alarm three years ago about what one state official later described as the nation's largest school system embezzlement.

The clerk thought it odd, prosecutors said on Wednesday, that a man with a Roslyn school district credit card was buying construction material at the Home Depot store in Selden, 35 miles east of Roslyn. There are many Home Depot stores in between. But even more odd was the address to which the stuff was being delivered, in Center Moriches, 50 miles east of Roslyn.

The clerk's phone call to Roslyn officials was the first hint of a scheme that the authorities say resulted in the embezzlement of $11 million in school money, led to the arrest of top school administrators and inspired State Comptroller Alan G. Hevesi to describe the Roslyn scandal as "the largest, most remarkable, most extraordinary theft" from a school system "in American history."

John McCormick, 40, the man prosecutors say was using that Roslyn school credit card, and to whose home that construction material was shipped, was arrested on Wednesday and charged with grand larceny. Prosecutors said he had been given the card by his mother, Pamela Gluckin, the former assistant schools superintendent for business, who is accused of stealing more than $4 million from the district over a period of years.

At a news conference on Wednesday, the Nassau County district attorney, Denis Dillon, said Mr. McCormick used his card to buy $85,000 worth of construction material from Home Depot stores in Selden and other Long Island towns, all of it paid for by the Roslyn school district, and all of it used by Mr. McCormick in his private contracting business. An audit by Mr. Hevesi's office found that Mr. McCormick's card was one of 74 school credit cards in unauthorized circulation among family and friends of Mrs. Gluckin and other school employees charged in the fraud.

Mr. McCormick faces a maximum of 15 years in prison. He pleaded not guilty at his arraignment in the county's District Court, and was released without bail.

Mr. McCormick's mother and his cousin, Debra Rigano, who is accused of stealing about $780,000, face grand larceny charges. Another major defendant, Frank A. Tassone, the former school superintendent, pleaded guilty last month to comparable charges. He agreed to pay back what he stole, an amount prosecutors place at $2 million, and will receive a 4-to-12-year prison term when he is sentenced on Nov. 29.

The authorities consider the Roslyn embezzlement scandal extraordinary in several respects, not only for the size of the theft, but for its having eluded the attention of prosecutors for as long as it did.

The Home Depot clerk's phone call, for example, the tip that Assistant District Attorney Peter Mancuso now identifies as "where it all began," was made three years ago, in October 2002.

But instead of leading directly to a criminal investigation, the tip was checked first by the school system's auditor, Andrew Miller. Mr. Miller reported his findings to the superintendent at the time, Dr. Tassone. Dr. Tassone took the matter to the Roslyn School board with a dire warning. He told them that the school district's reputation would suffer immensely if the matter became public, several board members have said.

So, though Mr. Miller's audit identified $250,000 allegedly stolen by Mrs. Gluckin and her son, a sum later found to be a small fraction of the actual loss, the school board decided to allow her to repay that amount and to resign in October 2002.

The true scope of the fraud did not begin to emerge until February 2004, when members of the school board, the district attorney and several local newspapers received copies of an anonymous letter alleging that Mrs. Gluckin and Dr. Tassone had been involved in a long-term embezzlement of school funds, and that the amount of the theft was in the millions. With citations and specific allegations that lent it credibility, the letter led to simultaneous investigations by various authorities. The author of the letter has never been identified.

In addition to indictments against Dr. Tassone, Mrs. Gluckin, Mrs. Rigano and Mr. McCormick, the investigation led to a 26-count criminal indictment last month against Mr. Miller, the auditor, on charges of falsifying school business records to help cover up the thefts. Others may yet be indicted, Mr. Dillon said. In the matter of unauthorized Home Depot purchases alone, he said, Mr. McCormick's alleged $85,000 theft accounts for only a part of $587,000 in unauthorized purchases made from various stores in the chain with Roslyn school credit cards.

That so many purchases over a period of about six years raised only one clerk's suspicion or roused only one to make a phone call probably added to the long wait before the fraud was exposed, prosecutors said.

"It's rare for people to extend themselves in a matter in which they have no interest," said Mr. Mancuso, the assistant district attorney, who did not identify the Home Depot clerk he named as "the one who made this whole thing start to unravel, the one who took that step no one else did."

He said he was grateful for the uncommon character of that clerk.