An embezzlement scandal in an affluent Long Island community has residents asking hard questions about how a school district known for its Advanced Placement classes, college-bound graduates, and generous school budgets apparently could have been bilked out of millions by trusted administrators.
The unfolding drama in New York state’s 3,300-student Roslyn Union Free School District, located about 20 miles from Manhattan, heated up last week, when former Superintendent Frank A. Tassone was charged with grand larceny on July 6 for allegedly stealing more than $1 million from the system between 2000 and 2002.
The Nassau County district attorney also has charged Pamela C. Gluckin, a former assistant superintendent for business, with grand larceny for allegedly stealing more than $1 million from the district over a five-year period.
Nassau County District Attorney Denis Dillon said in a statement that Mr. Tassone and others had used district credit cards “for personal expenses such as airline travel, cruises, hotel and resort accommodations, dermatology treatments, furniture, jewelry, and meals.”
Mr. Tassone and Ms. Gluckin have pleaded not guilty.
Investigators from the state comptroller’s office are now combing through years of financial documents and transactions. The district has identified close to $8 million in suspicious spending dating back to 1990.
In a sign of community anger over the unfolding scandal, voters in Roslyn for the first time in two decades rejected the district’s $82 million budget proposal on May 18. A pared-down budget goes to the voters this week.
“Parents are shocked and very upset,” said Denyse Dreksler, the co-president of the Parents’ Faculty Association at Roslyn High School. “In a district like this, where you have very educated people, everyone is extremely devastated.”
$33,000 in Dry Cleaning
Just days after Ms. Gluckin was charged, Mr. Tassone resigned after district officials discovered they had paid about $800,000 since 1993 to a word-processing company whose owner shares Mr. Tassone’s home address in Manhattan.
A list of suspicious transactions compiled by the district showed that the former superintendent allegedly billed the district for $33,000 in dry cleaning charges and other unauthorized expenses.
Charles Piemonte, the district’s assistant superintendent for curriculum and instruction, was named acting superintendent until an interim superintendent can be found.
“Though it will take a long time for the school district to get past this difficult situation, we will continue to focus on education,” Mr. Piemonte said in a July 6 statement. “This is a financial scandal, not an educational scandal.”
The district attorney’s office alleges that Ms. Gluckin used her authority to issue district checks to pay for personal expenses, including bills at a gourmet market and paying off a home mortgage.
Ms. Gluckin quietly resigned from the district in 2002, with the approval of the school board, after she paid back $250,000 that she allegedly embezzled. At the time, the board did not notify the public of the deal.
Then, this past February, an anonymous letter sent to the board claimed that Ms. Gluckin may have stolen more than previously suspected. The letter prompted the district attorney’s investigation, which found that the extent of the financial problem was worse than imagined.
William Costigan, the former president of the school board, said the district is working to improve its financial oversight and is conducting an investigation to uncover possible fraud.
“We had some unethical people who made a decision to embezzle funds, and who set up an elaborate plan for how they could do that,” he said in an interview.
Mr. Costigan, who was replaced as board president at a July 6 meeting but still sits on the board, pointed to the William Floyd school district, also on Long Island, where last month the district treasurer, James Wright, was charged with larceny for allegedly stealing at least $700,000 in school money by writing district checks to himself. Mr. Wright did not enter a plea. He is scheduled to return to court on Aug. 24.
But Mr. Costigan acknowledged the potential for abuse in the fact that Ms. Gluckin had the responsibility for both issuing checks and maintaining the records for receipts.
“The lesson for everyone is to make sure you always review your internal controls, and make sure there is a separation of powers between and among people who are charged with protecting the district’s funds,” he said.
The Roslyn school board is also considering taking legal action against its external auditor for its failure to identify suspicious transactions.
Barbara Bradley, the deputy director of communications and research for the New York State School Boards Association, said the financial scandal in Roslyn has captured the attention of other districts across the state.
“This is something that other school boards are aware of, and there are lessons to be learned from what Roslyn is experiencing,” Ms. Bradley said.
School boards, she said, can’t assume that an annual audit by an external auditor will check every invoice and spot all inconsistencies. Boards also must be assured that an internal auditor is truly independent, and that documentation of business transactions is carefully recorded, she said.
The school boards’ association has conducted several workshops across the state to teach board members how to do a better job of exercising financial controls.
“Boards need be concerned about this,” Ms. Bradley said. “This is part of what they do to be good stewards of taxpayers’ dollars.”
