New York exposing frauds that Chicago would be covering up

Anyone who reads the New York City newspapers and pays attention to our larger urban neighbor (albeit a neighbor 800 miles away) knows that (a) New York has a more democratic and professional media, with reporters who are not afraid to challenge the official lies of corporate "school reform," and (b) New York is even willing to prosecute crooks when they are exposed, even if those crooks were stealing from the city's public schools with the blessings of clout. In Chicago, that's unlikely. During the 16 years that Mayor Richard M. Daley ran the schools the Inspector Generals (both at City Hall and at the Board of Education) spent more time doing time and motion studies of the workers (and issuing reports that went along with management) than looking into the corruption that was running rampant from contracts to the simplest commodity purchases.

Chicago's Public Schools Inspector General's "investigators" routinely tip off management about whistle blowers, and always look the other way at the hint of major corruption. Every year, the longest number of Inspector General investigations at CPS involve teachers "cheating" either on residency or on where their own kids go to school. There are also the nickel and dime instances where some clerk is caught taking money from the school's general fund, or a teacher is caught red handed watching Internet Pornography on the Board of Education computer.

In most other cities, there is at least some agency which actually looks into real corruption: the million dollar kinds, characterized by ruthless overbilling by outside lawyer, routine contract cost overruns caused by collusive bidding for jobs (once the Board has approved the "low bid" on a contract, the approvals for adds are routinely approved -- unless the contractor gets in trouble with City Hall). The Chicago Public Schools Inspector General has never found an instance of serious corruption at one of the city's charter schools, and the thought that there would be an investigation of the "Minority-Women" business ownership scams that run through just about every big contract (computers are a prime example, both hardware and software, just as in New York) would be as laughable to those who know Chicago as the idea that the Chicago Tribune would write that the majority of Chicago charter schools' students are lower, at this point in history, than real public school students, based on Illinois standardized test scores.

But enough of that reminder. New York City, even though it's had mayoral control of the schools, has an aggressive press corps that doesn't simply provide cheerleaders for the latest corporate school reform flavor of the month, or for the mayor's latest public schools "reform" scam. There is just one thing Chicagoans might want to think about as their new Board of Education (still under the thumb of their mayor and his cronies) votes to add millions of dollars (at its June 22, 2011 Board meeting) to many of the school system's IT (technology contracts -- hardware and software), as stated in the following article from the New York Daily News: "Such contracts, Hearn said yesterday, are 'the new frontier for corruption' in government. To better protect against a repeat of CityTime, Hearn has been pressing Bloomberg for major reforms in the city's awarding of giant IT contracts..."

Here is an example of how another big city actually pays attention to the corruption at the top and the waste of millions of dollars on hardware and software scams:

$450 million Fraud: CityTime husband and wife team flee country leaving 200 employees in the lurch BY JUAN GONZALEZ - NEW YORK DAILY NEWS, Tuesday, June 21st 2011, 4:00 AM, on line

Reddy and Padma Allen fled to their native India after leaving 200 employees in the lurch after raking in $450 million from the CityTime project.

Reddy Allen and his wife, Padma, once were rising stars in the world of computer consulting.

Their company, TechnoDyne, raked in more money as a subcontractor on the Bloomberg administration's CityTime payroll project than any other - $450 million since 2005.

TechnoDyne grew so rapidly that NJBiz dubbed it the No. 2 minority-owned firm in that state. Accounting giant Ernst & Young even honored Padma Allen as entrepreneur of the year last year.

Today, the Allens are fugitives.

They flew to their native India a few weeks ago, soon after federal prosecutors subpoenaed them to appear before a grand jury. Their company has since collapsed, leaving more than 200 employees out on the street.

Yesterday, Manhattan U.S. Attorney Preet Bharara unsealed indictments against the couple and their firm on charges of paying millions in kickbacks to get CityTime work, and for money laundering.

The indictment, along with the arrest of another former official from CityTime's prime contractor, Scientific Applications International Corp., brings to 11 the number of people charged with CityTime crimes since December. Two of those have pleaded guilty and are cooperating; a third has since died.

CityTime was "one of the largest and most brazen frauds ever committed against the city," Bharara said.

For its sheer size and complexity, it is unprecedented. Since the arrests began, prosecutors have seized more than $38 million in some 120 bank accounts for the scores of shell companies the crooks used across three continents to mask their transactions.

The most recent actions of the Allens demonstrate just how callous this pack of alleged thieves was.

On the night of May 31, employees of TechnoDyne learned by email their firm had closed its doors, effective that day.

When they tried to retrieve their final paychecks the next day, the employees were stunned to learn that the Allens had removed everyone from the payroll in mid-May.

More than 200 people, in other words, worked for two weeks without knowing they'd been dismissed. For that alone, the Allens deserve an old-fashioned whipping more than jail time.

Bharara's prosecutors and the staff of Commissioner for Investigation Rose Gill Hearn have done an amazing job of identifying $90 million bilked from taxpayers in this scheme.

Such contracts, Hearn said yesterday, are "the new frontier for corruption" in government.

To better protect against a repeat of CityTime, Hearn has been pressing Bloomberg for major reforms in the city's awarding of giant IT contracts.

Now it's up to City Council to make sure Bloomberg heeds Hearn's suggestions.

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