CHICAGO (AP) — The former CEO of Chicago Public Schools plans to plead guilty to corruption charges announced Thursday that allege she helped steer more than $23 million worth of no-bid contracts to education companies in exchange for hundreds of thousands of dollars in bribes and kickbacks.
Barbara Byrd-Bennett, who resigned earlier this year as leader of the nation's third-largest school district, "takes full responsibility for her conduct," said her lawyer, Michael Scudder.
He said she would plead guilty at a later date to charges in the indictment, which also accuses the companies' owners of offering Byrd-Bennett a job and one-time payment — disguised as a lucrative signing bonus — once she left CPS, which is facing a steep budget shortfall and a severely underfunded pension system.
"If you only join for the day, you will be the highest paid person on the planet for that day," one of the executives wrote in an email to Byrd-Bennett about the bonus, according to the indictment.
The indictment alleges that Byrd-Bennett expected to receive kickbacks worth 10 percent of the value of the no-bid contracts, or about $2.3 million. It's unclear how much money was set aside, though the indictment says two trust accounts tied to her relatives — identified only as Relatives A and B — were set up to help hide the money.
Prosecutors allege the scheme started in 2012, the same year Mayor Rahm Emanuel chose her to become CEO of the nation's third largest school district. Rahm released a statement Thursday saying he was "saddened and disappointed to learn about the criminal activity" that led to the indictment.
"Our students, parents, teachers and principals deserve better," the Democrat said.
Byrd-Bennett, 66, is charged with several counts of mail and wire fraud; each count carries a maximum 20-year prison sentences. U.S. attorney Zachary Fardon said the indictment accuses her of "abusing her power to line her own pockets and those of her co-defendants."
The longtime educator stepped down from the post about four months ago, amid a federal investigation into a contract between the district and SUPES Academy, a training academy where she once worked as a consultant.
The company's owners, Gary Soloman and Thomas Vranas, are accused of offering her money — including plotting to place $127,000 into each of the two accounts set up under her relatives' names — along with sporting event tickets and other kickbacks in exchange for the contracts.
In emails included in the indictment, Solomon and Vranas appear to discuss payments to Byrd-Bennett. Vranas is quoted in one saying, "Everyone sucks and is greedy." In an email sent to Soloman on Sept. 10, 2012, Byrd-Bennett wrote: "I have tuition to pay and casinos to visit."
Both suburban Chicago men are charged with bribery and conspiracy to defraud, along with mail and wire fraud. The indictment also charges SUPES Academy and a subsidiary, Synesi Associates LLC, which specialize in training principals and school administrators.
Soloman's attorney released a statement saying Soloman has cooperated in the investigation and stands behind his companies' training and service. The statement says Solomon has acknowledged "certain errors" in judgment, but that he's disappointed he was charged.
Vranas and his attorney didn't immediately return calls for comment.
CPS suspended its contract with SUPES Academy and confirmed it had been subpoenaed shortly after Byrd-Bennett announced she was taking a paid leave of absence in April, about two months before she resigned.
The federal investigation followed a tough re-election bid for Emanuel, who spent much of his time on the campaign trail defending his decisions to close dozens of schools in 2013 and to choose Byrd-Bennett to lead the district with an annual salary was $250,000. At the time, Emanuel said he was proud of his choice of Byrd-Bennett.