School Officials Bribed With Cash, Cruises and Strippers: Prosecutors

Niles, Illinois – Two men were indicted on federal charges of defrauding more than 200 school districts in 19 states out of more than $33 million.

Also charged were four school officials who the U.S. Attorney alleges accepted bribes in the form of Caribbean Cruise vacations, cash and services at a gentleman's club.

Federal officials allege the fraud involved school districts in Illinois, Colorado, Georgia, Hawaii, Idaho, Indiana, Louisiana, Minnesota, Montana, New Mexico, New York, Oklahoma, Oregon, South Dakota, Tennessee, Texas, Virginia and Washington during the 2008-2009 and 2009-2010 school years.

Brilliance Academy, Inc., was contracted with school districts across the country to provide "supplemental educational services" under the 2001 No Child Left Behind Act by tutoring students at schools. A subsidiary company, Babbage Net School, Inc., contracted to tutor students through laptop computers provided to students.

Both companies were based in Niles, Illinois.

The U.S. Attorney alleges the companies, among other things, "falsified students' progress reports" and configured a computer program to ensure that students' post-test scores "were always higher than their purported pre-test scores."

Jowhar Soultanali and his son Kabir Kassam, ran Brilliance Academy and Babbage. Soultanali was charged with five counts of mail fraud and three counts of bribery. Kassam was charged with five counts of mail fraud and two counts of bribery.

Soultanali, 58, of Morton Grove, Illinois, and Kassam, 34, of Wheeling, Illinois obtained between $8 million and $13.6 million for themselves and their families, the U.S. Attorney alleges.

"As part of the fraud scheme, the defendants also allegedly engaged in fraudulent billing, including inflated invoices base on false attendance records, spreadsheets, and a computer program that contained false tutoring time summaries," the U.S. Attorney stated.

Indicted on bribery charges were Arturo Martinez, 52 of New Mexico, who was an educational administrator at the New Mexico Education Department; Cedric Peterson, 61, of San Antonio, Texas, who was the assistant principal at Fox Tech High School; Armando Rodriguez, 54, of Corpus Christi, Texas, who was SES coordinator at Miller High School; and Brian Harris, 33 of San Antonio, Texas, who was SES coordinator at Sam Houston High School.

The indicted school officials allegedly received cash to steer federal funds toward the companies, the U.S. Attorney stated. Peterson also received Caribbean cruise vacation. Martinez also received meals "and services at a gentleman's club."

The indictment states that the U.S. attorney will seek forfeiture of more than $33 million from Soultanali and Kassam, as well as their residences, three condominiums, five luxury automobiles, six whole life insurance policies, and "various items of diamond jewelry purchased in 2009."