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Originally published Monday, October 17, 2011 at 10:17 PM

Sources: Charges to be filed in Seattle schools scandal

King County prosecutors plan to file a felony theft charge against Silas Potter Jr., the central figure in the financial scandal that rocked Seattle Public Schools in February, according to law-enforcement sources who have been briefed on the investigation.

Seattle Times staff reporter

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Documents

Superintendent Goodloe-Johnson's contract (PDF)

Termination of Superintendent Employment Agreement (PDF)

Goodloe-Johnson's statement (PDF)

Susan Enfield's resume

Interim Superintendent Employment Agreement (PDF)

Ron English's statement in response to Silas Potter (PDF)

Audit documents

Washington State Auditor's report (PDF)

Audit supporting documents (PDF)

Eakes' report (PDF)

Videos, photos

Gallery | Seattle Superintendent Goodloe-Johnson ousted

Raw video: Seattle School Board votes on Goodloe-Johnson's contract

Seattle School Board appoints Susan Enfield as interim superintendent

Raw video: School board members comment on financial scandal

Raw video: School board member Betty Patu speaks

Raw video: General Counsel Legal Advisor speaks at School Board Meeting

Raw video: Reactions at school board meeting

Raw video: More reactions

Raw video: School counselor reacts to firing of Goodloe-Johnson

Raw video: School teacher reacts to Goodloe-Johnson's dismissal

quotes Ironic that charges are being filed mere days after The Seattle Times lovingly endorsed... Read more
quotes "But an outside attorney hired by the district to review management's actions conc... Read more
quotes The internal SPS auditor who looked the other way was Kariuki Nderu. He has since quit... Read more

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King County prosecutors plan to file a felony theft charge against Silas Potter Jr., the central figure in the financial scandal that rocked Seattle Public Schools in February, according to law-enforcement sources who have been briefed on the investigation.

Potter, a former district employee, is expected to be charged in a scheme involving the use of a dummy company to bill the school district for nonexistent work, one source said.

Two other people — a man and a woman — also are expected to be charged in the scheme, the sources said.

King County Prosecuting Attorney Dan Satterberg is expected to announce the charges as early as next week, outlining what he believes can be proved after a long, comprehensive criminal investigation by the Seattle Police Department, one source said. Satterberg also is expected to discuss broader questions about the district's financial practices that he concluded did not rise to the level of criminal conduct.

Teresa Wippel, a spokeswoman for the school district, said it is supporting the investigation and independently pursuing various options to recover nearly $300,000 in financial losses.

The district has hired an attorney to explore the feasibility of a lawsuit.

Seattle School Board President Steve Sundquist said the money may be difficult to recover since Potter and others involved apparently don't have a lot of assets.

The scandal prompted the School Board to dismiss Superintendent Maria Goodloe-Johnson in March amid revelations of financial improprieties that left the board scrambling to repair the damage. Susan Enfield, the district's chief academic officer, was named as interim superintendent.

Goodloe-Johnson, who served 3 ½ years as superintendent, fell victim to a state audit that found $1.8 million of contracts awarded through the district's small-business contracting program run by Potter provided no public benefit or were questionable.

Goodloe-Johnson was not directly implicated in the auditor's report, which detailed improper activity in the small-business program. But an outside attorney hired by the district to review management's actions concluded she and her top financial and operations aide, who also was dismissed, both knew enough about those problems that they should have acted.

Potter, who was a midlevel manager for the district before he moved to Florida, could not be reached for comment Monday night.

He told The Seattle Times in March that he was being made a scapegoat. Potter denied being behind the alleged misappropriation of district funds that triggered the criminal investigation, and blamed the problems on others working above him.

The state audit detailed a rogue contracting operation within district offices, replete with overbilling, ethics violations and intimidation of critics.

Among the contractors who benefited were the Urban League and prominent members of the community whose work allegedly provided little or no public benefit.

In a 76-page summary, state auditors revealed some possibly illegal acts and some useless expenses.

The audit disclosed how the small-business program started as a way to help companies learn how to bid for school-district construction projects, but grew into an operation that spent up to $1 million a year, offered dozens of classes and signed partnership agreements with other government agencies such as the city of Bellevue, the Port of Seattle and Tacoma Public Schools.

Education reporter Brian M. Rosenthal contributed to this report, which includes information from Seattle Times archives.

Steve Miletich: 206-464-3302

or smiletich@seattletimes.com

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