Emails Indicate GHAPS may not have Reported All Embezzlement Related Financial Losses to the Public
Two different emails indicate GHAPS may not have disclosed all financial losses to the public.
In an email dated February 7, 2022 former GHAPS school board member Barbara Pietrangelo asked, “Is the forensic audit only looking at the fraud issues related to Brian, or is it looking into all aspects of GHAPS finances?” She received a response the following day from Superintendent Scott Grimes which stated, “The forensic audit was arranged by Thrun Law Firm and was only looking at the issue related to Brian Wheeler.”
This statement is important for two reasons. First it says the audit was arranged by the law firm and not by the school district. This was likely done to prevent the public (who paid) from seeing the results of the forensic audit through the use of attorney-client privilege. By having the law firm arrange the audit, the law firm owns the audit, and it is therefore not subject to FOIA. In other words, members of the press or public cannot FOIA documents owned by a private law firm, whereas they could FOIA a document owned by the school district. Keeping the audit from the public reduces public scrutiny because the public does not really know what happened. This is the opposite of being transparent, especially since Grand Haven taxpayer funds were used to pay for the audit.
Secondly, the response to this question confirms that the audit is limited in scope as related to Brian Wheeler. In other words, the audit did not look into any other bond funds or other aspects of GHAPS finances. It is an interesting question to ask as it indicates there are reasons GHAPS should investigate other aspects of the finances.
This suspicion is confirmed by an email from Michael MacDonald.
On January 6, 2022 the GHAPS Director of Finances says, “I wanted to follow up with you on your question regarding any additional reporting since the embezzlement affected our bond funds.” Notice he says ‘funds’ vs ‘fund’. What happened to the other bond funds?
Currently GHAPS holds four bonds, with the largest one being $19 million. In May 2023, GHAPS will be asking the public to pass a gargantuan $155 million proposal to build a new middle school and improve other district facilities.
(1) $9,390,000 issued on 12/4/2013 - end date 2025
(2) $19,325,000 issued 6/19/2014 - end date 2025 – This is the technology bond from which Brian Wheeler embezzled
(3) $7,735,000 issued on 12/28/2017 - end date 2025
(4) $10,780,00 issued on 6/5/2020 - end date 2024
If the $155 million bond proposal passes, GHAPS plans to refinance the remaining bonds and levy everything over 20 years. This would delay the expiration of these existing bonds by almost 20 years.
In the email above, Michael MacDonald says the bond losses will be reported when they are sold. If this bond proposal passes, does this mean they will not be sold for an additional 20 years?
This embezzlement threw away over $1 million of the public’s money and the public deserves full disclosure. We need transparency from our elected officials and public servants. What is the meaning of Michael MacDonald’s email?