OIG: Office of Inspector General
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Investigation Report

  U.S. Department of Justice

United States Attorney for the
District of Columbia
Judiciary Center
555 4th Street, N.W.
Washington, D.C. 20530


Thursday, August 9, 2007
For Information Contact Public Affairs
Channing Phillips     (202)514-6933

Former Top D.C. Charter Schools Official Pleads
Guilty to Embezzlement and Tax Evasion

Washington, D.C. - A former top official in the D.C. Public Schools responsible for charter school oversight, Brenda Belton, pleaded guilty today to four felonies in connection with her corrupt scheme to defraud the D.C. Public Schools, announced U.S. Attorney Jeffrey A. Taylor, U.S. Department of Education Inspector General John Higgins, Special Agent in Charge Francis L. Turner, Internal Revenue Service, Criminal Investigation, District of Columbia Inspector General Charles J. Willoughby, District of Columbia Chief Financial Officer Natwar M. Gandhi and Sherryl Hobbs Newman, Deputy Chief Financial Officer for the District of Columbia's Office of Tax and Revenue.

Belton, 61, of Washington, D.C., entered her plea of guilty before U.S. District Judge Ricardo M. Urbina to two felony counts of Theft from a Program Receiving Federal Funds, each ten-year offenses; one felony count of Federal Tax Evasion, a five-year offense; and one felony count of District of Columbia Tax Evasion, a ten-year offense. Pursuant to the Federal Sentencing Guidelines, Belton faces a likely sentence of 30 to 37 months in prison. Belton is scheduled to be sentenced by Judge Urbina on November 29, 2007. As part of her plea, she has agreed to pay $383,000 in restitution.

According to the government's statement of facts presented to the Court and agreed to by the defendant, from between March 2003 through May 2006, Belton used her position as Executive Director of the District of Columbia School's Office of Charter School Oversight to divert money belonging to the District of Columbia, and money coming from the federal No Child Left Behind program, to various bank accounts over which she had control. As part of her scheme, Belton submitted false and fraudulent invoices to steal more than $200,000 in public funds, claiming that such funds were for monitoring the quality of D.C. charter schools.

Belton furthered her scheme by violating contracting rules in awarding seven no-bid schools contracts worth over $400,000. The primary beneficiaries of those contracts were Belton's friends; and, in return, Belton received over $180,000 in kickbacks and other fraudulent payments.

For example, in January 2004, Belton approved a charter school application for Young America Works, which is run by two of her friends. Meanwhile, Belton had reached a deal with a private real-estate group, of which she was a principal, to facilitate property purchases in the District of Columbia. One of those properties, at 6015 Chillum Place, NE, became the location for the Young America Works Charter School. As part of her scheme, Belton received $5,000 from the real-estate group for months in which the Young America Works Charter School paid its rent to the real-estate group. Belton received $50,000 through such payments.

Finally, Belton willfully evaded nearly $100,000 in federal taxes between 2002 and 2005 and nearly $30,000 in District of Columbia taxes in 2004-05.

U.S. Attorney Taylor called Belton's conduct "a shocking and disturbing abuse of her official position. The stolen money she put in her own bank accounts, the money she steered to her friends in improper, no-bid contracts, and the thousands of dollars in kickbacks she received-all of these were at the expense of the children in our community. Our children deserve much better."

"The misappropriation of federal education dollars by Ms. Belton came at the expense of Washington, D.C. students, as well as the American taxpayer," stated U.S. Department of Education Inspector General Higgins. "My office will continue to aggressively pursue those who seek to defraud federal education programs at the expense of our nation's students."

"Crimes committed by public officials violate the public trust," stated IRS Special Agent in Charge Turner. "Part of IRS-CI's mission is to assure honest taxpayers that everyone pays their fair share."

"This investigation exemplifies how local and federal authorities can work together for the common good," said District of Columbia Inspector General Willoughby.

"This is a good end to a most disturbing situation," said Chief Financial Officer Gandhi. "We are especially pleased that the plea involves the repayment of stolen funds, which should have been going to improving the education of District school children."

"When it is proven that someone is taking money from schools, we are pleased that they are being held accountable under the full extent of the law," stated Deputy Chief Financial Officer Newman.

In announcing the guilty plea, U.S. Attorney Taylor, District of Columbia Inspector General Willoughby, U.S. Department of Education Inspector General Higgins, IRS Special Agent in Charge Turner, Chief Financial Officer Gandhi and Deputy Chief Financial Officer Newman commended the hard work, diligence, and professionalism of Special Agent Derrick L. Franklin, of the U.S. Department of Education Office of Inspector General; Special Agent Bernadette Todd-Atwater, of the District of Columbia Office of Inspector General; and Special Agent Troy A. Burrus of the Internal Revenue Service Criminal Investigation Division; and Edmond Wybaillie, Lead Investigator, Criminal Investigation Division, D.C. Office of Tax and Revenue. They also praised legal assistants Lisa Robinson and Teesha Tobias in the U.S. Attorney's Office, former Assistant U.S. Attorney Roy L. Austin, Jr., who conducted the wide-ranging investigation, and Assistant U.S. Attorney Timothy G. Lynch, who is prosecuting the case.

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Last Modified: 08/14/2007