It appears there was collusion going on between various Delaware agencies when it came to the Indian River School District audit investigation in 2016. As a result of that collusion, Patrick Miller walks free and Susan Bunting became the Delaware Secretary of Education.
In 2016, while everyone was focused on the upcoming elections, various state agencies were deciding what to do about the Indian River Audit Investigation. A recent letter showcases some of the baffling shenanigans that went on during the months before the actual report came out.
In August of 2016, the Delaware Department of Justice met with the Auditor of Accounts office. The audit investigation into Indian River was ready to come out but the Delaware DOJ stopped it. The Deputy Attorney Generals handling the case were Allison Reardon and Dennis Kelleher. No reason was given for the delay. Ultimately, the report came out a mere five days before the Indian River referendum in November of 2016.
While Patrick Miller, the former Chief Financial Officer for Indian River, was allowed to retire and collect a pension, activities surrounding his coinciding tenure at Indian River Volunteer Fire Company (IRVFC) were also under the microscope.
Two board members of IRVFC approached Dave Smith with the Division of Revenue. They let Smith know Miller committed tax fraud. Each year, some members of fire companies in Delaware receive a $400 tax credit. Miller was in charge of submitting those names to the state for IRVFC. But Miller submitted names of people who were not members of IRVFC. Smith asked the board members for a list of the non-member names. Nothing has come out about these allegations since this time.
By September of 2016, shortly after Indian River cut their discretionary budgets for schools and their district office, rumors began circulating that Miller stole up to $15 million dollars from the district during his 18 years as CFO. While that number is highly exaggerated, people knew Miller stole money. The district had removed all their financial information from their website at the beginning of the school year.
Even though the State Auditor’s office completed their investigation in August, the report didn’t come out. At one point, State Auditor Tom Wagner wanted the report to come out after the Indian River Referendum even after he announced it would come out before.
The two IRVFC board members who approached Smith about the tax fraud also began speaking with an attorney. They wanted Miller suspended from IRVFC. The attorney reached out to the district’s attorney, James McMackin, who gave the attorney the contact information at the Auditor of Accounts office, Andrena Kardos (now Burd) and Jennifer Reiske.
On 9/22/16, Wagner gave comments to Coastal Point. He gave the impression the audit investigation was not completed. Since the report was completed, Wagner was making it sound like it wasn’t. In fact, on 10/20/16, Wagner sent out a media advisory stating the report would come out before the referendum and he authorized compensatory time for those working on the investigation, to make sure it came out prior to November 22nd, 2016. If the report was finished in August, did employees at the Auditor of Accounts office get overtime for something that was already done?
Meanwhile, weeks before the report came out, the IRVFC attorney spoke with Tammy Smith at AOA. They discussed the possibility of implication between IRVFC and the school district in the final report. The attorney advised Smith that AOA could come in and investigate based on the IRVFC bylaws. The board at IRVFC would have to “invite” AOA to come in and conduct an audit. Smith was going to speak with Tom Wagner and would get back to the attorney. Smith gave the attorney a contact name at the Delaware DOJ who was the special investigator assigned to the Indian River School District investigation- Mr. Jean Rothenburger.
On November 4th, Indian River Superintendent Dr. Susan Bunting, along with board members Charles Bireley and Rodney Layfield, wrote a letter to the editor of the Sussex Post in response to anti-referendum ads that appeared in the newspaper. The trio stressed that Miller did not answer to Bunting but to the Board of Education. They emphatically stated the district cooperated with the Auditor’s office.
Five days later, the district received a copy of the final report. This is customary in case the agency under investigation wants to give a response.
On November 17th, State Auditor Tom Wagner released the report that had been completed nearly three months earlier. In a press conference, Wagner said the timing for the release of the report was not a political move.
Meanwhile, newly elected Delaware Governor John Carney was putting his Cabinet together. Initially, he wanted Brandywine Superintendent Mark Holodick as his Secretary of Education. Holodick turned Carney down. Other names began to enter the mix- Dusty Blakey from Colonial, Kevin Carson from Seaford, and Bunting.
Since IRVFC was specifically named in the audit report, the two board members contacted the attorney the day after the report release and began to plan how to suspend Miller. Miller was also on the Boys & Girls Club in the area. They asked Miller to step down from their board and he did so without incident. But the faction of the board at IRVFC that wanted Miller out did not think he would go quietly.
The same day, Bunting, Bireley, Assistant Superintendent Mark Steele, and the new district CFO Jan Steele gave a press conference about the audit. Bunting looked into the camera and lied. She said “the district was unaware of the financial misdoings by Miller before the audit.” She went on to say “we were unaware of his actions. The Board had complete trust in him.” How far that trust went is certainly a matter of supposition. One district board member, Charles Bireley, conducted the annual audits for IRVFC. Another district board member also sat on the board of IRVFC. In fact, she was one of the board members that contacted the attorney to see how to get Miller suspended. Leolga Wright and her son Tyler were the ones in contact with the attorney at IRVFC.
A few days after the press conference, the attorney emailed the Wrights a letter stating not only does the Board have the authority to suspend Miller but they also have a duty to do so to protect the assets of the IRVFC. The attorney said the IRVFC board should suspend him and to immediately take away all accounts, assets, and property of IRVFC pending the completion of an investigation. This would include any debit or credit cards. The attorney said all financial institutions associated with IRVFC should be contacted to remove Miller as a signatory. As a suggestion, since Miller was the President of the IRVFC board, the attorney also said the Vice-President of their board, Mario Street, could also be implicated in this. Therefore, he recommended the Secretary of the Board lead the suspension based on the hierarchy of the board. The Secretary at that time was Tyler Wright. The attorney said an internal audit would not be sufficient and IRVFC should allow the Auditor of Accounts office to conduct a full audit investigation.
The next day, Indian River School District lost their referendum by 30 votes.
A week later, Andrena Burd and Tammy Smith from the Auditor of Accounts office contacted the attorney to see if they should come in. The attorney told them he thought they would already be there given the implications between the fire company and the school district. Smith told the attorney she had spoken with Tom Wagner and Deputy AG Allison Reardon about this and would speak to them again.
As the 2016 holiday season drew to an end, things got quiet. On December 30th, Governor-elect John Carney announced his pick for Secretary of Education- Dr. Susan Bunting. While Bunting was not his top choice originally, Carney proudly exclaimed Bunting would be excellent based on Indian River’s test scores. The day before, I received an anonymous letter from a teacher in the school district. The teacher was very concerned about the rumors Bunting would become Secretary. The teacher wrote:
Some people think if Miller is prosecuted, he might turn on the top district employees and testify against them for a plea deal that favors him. The audit that was done clearly shows how dishonest he was, but they need to dig deeper and find out the true amount of money he mishandled or stole.
In the hours before Carney announced Bunting, I sent the letter to Albert Shields, Carney’s policy director. I urged Shields to make sure Carney had this information and to reconsider Bunting as his pick. I received no response from Shields.
Less than a month later, Bunting was confirmed by the Delaware Senate to become the next Delaware Secretary of Education.
A week after her confirmation, I met with Bunting in her office. I showed her the letters I received and asked for her thoughts. Bunting looked me in the eyes and told me the district had no idea about Miller’s actions and they were as shocked as everyone. I first planted a seed that something needed to happen to decode education funding and how districts and charters spend taxpayer dollars. I never heard anything back from her on this front until almost a year and a half later when I approached Bunting and State Rep. Earl Jaques about a proposal I had to do work on this very thing. To this date, I have heard nothing back from the Delaware DOE about this proposal.
Meanwhile, the Indian River district board was demanding reimbursement from IRVFC for an overhead projector paid for with school funds along with the profit IRVFC made when they sold the district an all-terrain vehicle. To this date, it is unknown if IRVFC did pay back those funds.
The same attorney that dealt with the Wrights at IRVFC represented the fire company over the reimbursement issue. Since Miller was directly connected with this, the attorney recommended a “fire wall” between Miller and anyone investigating the matter. He felt Miller should recuse himself from the investigation. Even though the attorney felt Vice-President Mario Street could have been implicated along with Miller in the potential investigation the previous fall, Street became the lead person on the investigation into Miller over the reimbursement issue. James McMackin represented Indian River School District on the reimbursement demand letter. IRVFC released the following statement on their website:
The Indian River Volunteer Fire Company received notice that the Indian River School District is seeking reimbursement of funds resulting from what may have been questionable transactions between the school district and the fire company which came to light as a result of an audit of the school district.
The Indian River Volunteer Fire Company is investigating this matter and promises its full cooperation to resolve this matter to the satisfaction of the school district, the fire company and the public at large.
Questions on this matter to should be directed to counsel for the Indian River Volunteer Fire Company, Gary Alderson at firstname.lastname@example.org.
At the end of February, 2017, State Auditor Tom Wagner released a memorandum as a follow-up to the school district audit inspection. He noted their improvements and gave some suggestions on how to improve. That was enough to satisfy a majority of voters as Indian River passed their second attempt at a referendum on March 2nd.
By the end of March, the attorney learned there was no investigation into Miller at IRVFC. The Auditor of Accounts office never came in to IRVFC to do an investigation. Later that year, Leolga Wright was briefly suspended from IRVFC. Miller and Street learned about her contact with the attorney the year before. As well, Leolga Wright personally paid for part of the attorney’s invoices from her own money. After a Board of Inquiry in September, 2017, Wright was reinstated to IRVFC. She continues to serve on the school district Board of Education.
Leolga Wright also serves on several committees at IRVFC. She is a one-person member of the Building Committee, the Fund Drive Committee, and the Sick and Sunshine Committee.
For the next nine months, all was quiet. Bunting was Secretary of Education and was performing the functions of that office. Miller was out of the spotlight. After Bunting became Secretary, Mark Steele became the new Superintendent of Indian River. It wasn’t until June, 2018, when board member Billie Jo Bullock began looking into the finances of IRVFC, that this issue came up again.
As a result of her uncovering issues with Patrick Miller and financial abuse at IRVFC, she was suspended from the board. On July 12th, she was terminated at IRVFC. But board Treasurer Mike Eisenhauer had seen enough. He contacted Vice President Mario Street who, instead of acting on the information and forming an investigation, went back to Miller with the information. Eisenhauer let Fire Chief Steven Deerey know this information. Because Bullock had gone public with information about IRVFC, the board hired the same attorney to go after Bullock. IRVFC spent a considerable amount of money with the same attorney in determining what to do about Bullock.
The IRVFC board met recently. Miller and Street informed the board they would investigate the allegations against Miller. A few days ago, the head of the Delaware DOJ’s Office of Civil Rights and Public Trust, Sonia Augusthy, wrote me an email which indicated IRVFC was being looked at by the Auditor of Accounts office in regards to the recent allegations against them. Her email did not indicate the scope of that action.
I made numerous inquiries into when Carney knew Bunting would be his pick for Secretary of Education. All those inquiries gave the same timeframe, about a week or two prior to his announcement on December 30th, 2016.
Based on this information, I have several questions:
- Why did the Delaware Department of Justice order the Auditor of Accounts not to release the final report of the audit investigation into Indian River School District in August, 2016? Did they have the authority to do so?
- Based on the list of indictments and prosecutions initiated by the Office of Civil Rights and Public Trust since the creation of that office in 2015, why has Patrick Miller never been indicted despite a preponderance of evidence against him?
- Wagner stated the timing of the release of the report was not a political move. If the report was completed in August, why did he wait until five days before the referendum to release it?
- Why didn’t Leolga and Tyler Wright press forward with a suspension of Patrick Miller at IRVFC?
- Why didn’t the Auditor of Accounts office automatically investigate IRVFC to coincide with the investigation of the school district given the substantial amount of evidence?
- Did Dave Smith at the Division of Revenue ever do anything with the tax fraud allegations against Miller?
- Why did Wagner go back and forth on when to release the audit investigation final report?
- What knowledge did Governor-elect John Carney or members of his office have about Bunting’s role with her knowledge of Miller stealing portions of grant funding?
- Were there side deals made to prevent any type of audit investigation into IRVFC and charges against Patrick Miller to make Carney’s pick of Bunting as Secretary of Education look clean? Is this why any investigation into Miller at IRVFC stopped at the same time?
- How serious is the current situation with IRVFC? Is the Delaware DOJ and the Auditor of Accounts office going to actually do their job this time?
- When will Bunting retire given her knowledge of Miller stealing education funds and the fact she knew for over a decade? As well as her direct knowledge of Miller verbally abusing a parent in 2012?
- Collectively, going back to Miller’s time at Brandywine School District, through Indian River School District, and now Indian River Volunteer Fire Company, how much money has Miller personally stolen? How much fraud has Miller authorized to benefit Delaware citizens who should not have received money or tax credits?
- Should Leolga Wright have resigned from the Indian River Board of Education given her very obvious conflict of interest with IRVFC?
- How many other Patrick Millers are there in Delaware, currently operating as stewards of taxpayer dollars, that are doing the exact same thing?
Until these questions are answered AND resolved, the game continues. The winners? Those who profit and hide this information. They get promotions and become more powerful. The losers? The taxpayers, the students, the teachers, and those who dare to become whistleblowers and receive retaliatory punishments for doing the right thing.
This is just conjecture on my part, but I believe the timing in which Kathleen Davies was put on administrative leave as second-in-command under State Auditor Tom Wagner given this information was not a coincidence. She was put on leave on mid-May 2016. This was right when the audit investigation into Indian River was kicking in. Given Davies dedication to auditing, I do not think the Indian River audit investigation would have gone down the way it did. I believe the audit investigation final report would have dug much deeper. It would have happened alongside a full investigation into Indian River Volunteer Fire Company. Aside from the obvious frame against Davies that has been publicly talked about for months, I have a strong hunch many powers in Delaware were very worried about upcoming audit investigations Davies would have worked on and did their best to get her out of there as soon as possible.
I firmly believe the timing of the release of the report was politically motivated. Had the report come out after the referendum, voters would have cried foul and it would have seriously stained Carney’s pick of Bunting as Secretary of Education. While I don’t believe he knew for sure Bunting would have been his pick at the time the report was released, she was under strong consideration.
As for the Delaware Department of Justice’s role in this, I have no clue why they would interfere with an audit investigation based on the below document from Attorney Gary Alderson. I can assume they were investigating what to do about Miller but given that nothing ever happened in terms of an arrest or indictment against him, I can only guess.