11th Detroit Public Schools principal cops a plea in kickback case

Following in the footsteps of 10 colleagues, an 11th Detroit principal has cut a deal with the federal government in a kickback case involving a vendor who scammed $2.7 million from DPS with the help of a dozen principals and an assistant superintendent.

So far, 10 of those principals, the assistant superintendent and vendor have pleaded guilty.

The latest to join that group is Willye Pearsall, a former principal at Thurgood Marshall Elementary School, who has a plea hearing scheduled for June 15.

Pearsall, 65, is charged with accepting $50,000 in kickbacks from longtime school supply vendor Norman Shy over a period of two years for signing off on Shy's fraudulent invoices. According to court documents, to disguise the kickbacks, Shy funneled money to Pearsall by writing checks to one of her businesses, known as 'Safety Net Enterprises.' Shy also wrote checks to J & J Youth Services. Those checks were really kickbacks to Pearsall, prosecutors allege in court documents.

Pearsall is charged with conspiracy to commit federal program bribery, which carries a maximum prison sentence of five years. She is among 14 individuals who were charged in March with helping run kickback schemes that largely benefited Shy, who pleaded guilty to bribery and tax evasion on March 11 and faces up to seven years in prison. He also has to pay back $2.7 million in restitution to DPS and $51,667 in back taxes to the IRS.

According to federal prosecutors, Shy was at the center of a $2.7-million DPS  kickback scheme that robbed students of supplies that were paid for but never delivered over a seven-year period. He is accused of paying nearly $1 million in kickbacks to 12 principals and one assistant superintendent as rewards for helping him submit phony invoices to DPS for materials such as paper, chairs and supplemental teaching materials.

Shy will be sentenced in September. So far, the stiffest penalty faced by his cohorts  is nearly six years in prison. That's what ex-assistant superintendent Clara Flowers is looking at after pleading guilty to accepting nearly $325,000 in kickbacks from Shy for helping him submit inflated invoices for materials that were meant for special education kids. The supplies, she said, were never delivered.

Prosecutors allege Shy cut deals with individual principals at different schools. The principals would approve his inflated invoices, and when Shy got paid, he kicked money and gift cards back to them, prosecutors say.

Out of the 14 defendants charged in March, 12 have pleaded guilty; Pearsall is scheduled to plead guilty in two weeks.

The only defendant who has not cut a deal in the kickback scheme is Josette Buendia, 50, of Garden City, principal at Bennett Elementary School. She is charged with accepting $45,775 in kickbacks from Shy.

Tresa Baldas can be contacted at tbaldas@freepress.com.