In its latest crackdown on school corruption in Detroit, the federal government today launched a legal bomb targeting 12 current and former Detroit Public School principals, one administrator and a vendor — all of them charged with running a nearly $1 million bribery and kickback scheme involving school supplies that were rarely ever delivered.
The accused vendor is at the heart of the alleged scheme: Norman Shy, owner of Allstate Sales, which sells school supplies and items including auditorium chairs and raised line paper. He is charged with paying $908,500 in kickbacks to at least 13 DPS principals and an administrator who used him as a school supply vendor in exchange for money. The kickbacks, records show, came in all forms: cash, gift cards, and payments to contractors who installed a new roof or gutters on one administrator’s home.
The vendor at the heart of the alleged scheme is Norman Shy, owner of Allstate Sales — which sells school supplies and items including auditorium chairs and raised line paper. He is charged with paying $908,500 in kickbacks to at least 13 DPS principals who used him as a school supply vendor in exchange for money.
According to court records, here’s how the scheme worked.
Principals steered millions of dollars worth of business to Shy, who in turn would give them money for helping make the deals possible.
The principals would certify and submit phony invoices to DPS for the school supplies. Shy got paid, but the goods were rarely delivered, only sometimes “for the purpose of making the transaction paper legitimate.”
Federal prosecutors allege that Shy ran this 5-year-long scheme with the help of Clara Flowers, an assistant superintendent of DPS’s Office of Specialized Student services. She had the authority for selecting vendors and ordering supplemental resources such as maps and workbooks for various DPS schools. She picked Shy, court records show.It was Flowers who first introduced Shy to DPS sometime before 2009, when as principal of Henderson Academy she chose Shy as school supply vendor for the academy. Flowers would continue to use Shy as a vendor when she became an assistant superintendent.
According to court documents, Shy maintained a ledger to keep track of how much money he owed Flowers in kickbacks, which came in the form of cash and gift cards. The two regularly met to discuss how much Flowers was owed for her favors, and Shy was careful not to get caught, disgusting his payments to Flowers in a variety of methods: checks payable to contractors who worked on Flowers’ home, including one company that did painting and gutter work. Shy also used DPS money to help pay for a new roof on Flowers’ house.
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