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Two CPS vendors too big to ban for ethical lapses, inspector general says

Updated: February 9, 2013 6:14AM



Two of Chicago Public Schools’ largest vendors investigated by the inspector general for significant ethical lapses may be too large to ban from district business — and still CPS fails to even monitor them adequately, the schools’ watchdog said in an annual report released Monday.

Removing the giant vendors for wining and dining employees and providing other perks for preferential treatment “would critically affect the ability of CPS to provide necessary services at market prices,” according to the report written by Inspector General James M. Sullivan.

The vendors — Chartwells-Thompson Hospitality and Preferred Meals Systems — handle about $77 million in CPS food service, and “not many other entities can handle that scale,” Sullivan said by telephone Monday.

Despite his recommendations that CPS appoint a monitor over such large vendors, “that recommendation has fallen on deaf ears,” the report reads.

Fraud also continues to plague the lunch program intended for poor children. More than 50 CPS employees have been caught enrolling their own children for free or reduced-price lunches over the last four years.

“The cases reported this year are especially important because the results show that fraud is being committed by high-level and highly-paid CPS administrators, and that the lucrative state and federal benefits tied to the forms drives the fraud,” Sullivan wrote. “Cumulatively, the issues the [inspector general] has reported on suggest wide-spread, systematic fraud.”

The nation’s third-largest school district is staring down a $1 billion deficit by summer.

CPS spokeswoman Marielle Sainvilus said in an email that CPS “has considered the OIG’s recommendations and is in discussions on the matter.”

“Following a complete investigation, we took immediate action on CPS employees who were involved in wrongdoing and they are no longer working with the District. Chartwells and Preferred pursued similar forms of discipline with their employees,” she said.

Sullivan said his office was able to investigate just 27.5 percent of the 1,651 complaints it received in fiscal year 2012, according to the report, creating “a substantial risk that waste fraud, financial mismanagement and employee misconduct go undetected.”

Residency complaints accounted for the greatest percentage of tips to the IG, followed by inattention to duty and on-duty criminal conduct.

Several students attending CPS’ competitive selective-enrollment schools were found to live in suburbs, including children of CPS staffers. The inspector general is seeking to recover $477,000 from out-of-bounds students.

Most of the staff residency cases involved CPS employees found to be living in the south suburbs.

A high-level leader from the central office was fired for living in Matteson. A high school engineer living in Hometown was fired after he was found visiting an Indiana casino and drinking beer during the workday. A high school assistant principal not only lied about living in Richton Park but also falsified free and reduced lunch applications for her daughter, an investigation found. She’s suspended with pay, according to the report.

And two teachers, husband and wife, were busted for living in a Tinley Park home they had owned since 2006. Though the IG recommended firing them, warnings were issued instead.

A central office employee living in Midlothian enrolled his child in CPS for three years and owes about $30,000 in tuition, according to CPS.



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