Audit: Queens special ed provider overcharged state $1.5M

1

A Queens special-education contractor overcharged the state $1.5 million, a Comptroller’s Office audit found.

Bilingual SEIT & Preschool Inc., a Queens-based provider of special education services, inappropriately charged New York City’s Department of Education by nearly $1.5 million for salaries, vehicle leases and items such as cosmetics and children’s furniture, according to the audit, released today.

The findings were referred to the Queens County District Attorney’s Office.

 “Special education services are critical for thousands of children, and every tax dollar meant for them should be spent on them,” said state Comptroller Thomas DiNapoli in a statement Thursday. “Sadly, my auditors have found that has not been the case at Bilingual SEIT & Preschool.

“As we have seen in several audits of special-education providers, taxpayers are footing the bill for expenses they shouldn’t have to cover, no-show jobs and other perks,” he said. “This cannot continue.”

The audit released today is part of an in-depth review by DiNapoli’s office of New York’s special education programs by a team of auditors and investigators. Three audits released in June led to the arrests of four contractors and restitution of $610,000.

The contractor in question provides services to about 700 children with special needs between the ages of 3 and 5. New York City’s Department of Education pays tuition to the contractor, using rates set by the state Education Department.

DiNapoli’s auditors found numerous reports that the contractor did not comply with state guidelines. For instance, Bilingual SEIT & Preschool Inc. officials could not provide records to show that 26 employees had actually worked the time they were paid for. Auditors disallowed the $233,368 paid to those employees.

Auditors also disallowed $107,380 paid to Bilingual’s assistant executive director, the former wife of its executive director. She was paid $369,081 for fiscal years 2007-08 and 2008-09, but she actually performed the services of a payroll specialist.

Bilingual inappropriately charged $795,368 in other costs not allowed by state guidelines, including:

 

– $186,819 in rental expenses for three buildings that were unrelated to the SEIT program, one of which was under construction;

 

– $60,280 in lease payments, gas, insurance, parking, tolls, and maintenance costs for three vehicles (a Toyota Matrix, a Honda Odyssey with a rear entertainment system, and a Mercedes Benz);

 

– $22,347 in interest expenses for bank loans taken out by the former wife of the executive director; and

 

– $5,567 in children’s bedroom furniture, as well as other charges for cosmetics and cell phone expenses.

 

Auditors concluded Bilingual officials may also have deprived federal, state, and local taxing authorities of a significant amount of tax revenues by treating top officials of the school, as well as certain other staff, as independent contractors rather than employees. The executive director, received $730,546 in total compensation for calendar years 2007 through 2009. Of this amount, just $108,270 was reported on his W-2 forms. The remaining $622,276 was paid to him as an independent contractor and was reported on the 1099 forms that were issued to him. Moreover, $577,276 of the $622,276 was issued to a separate corporation he formed. He admitted to investigators he did this intentionally because he had cash-flow problems, according to the report.

Similarly, just $114,504 of the $541,077 in compensation the assistant executive director received for calendar years 2007 through 2009 was reported on her W-2 forms. The remaining $426,573 paid to her as an independent contractor was reported on forms 1099. Again, $234,573 — 55 percent — of the $426,573 was issued to a separate corporation she had formed.

DiNapoli has issued recommendations to both the state and New York City education departments and is working with them to address these issues.

See the report here.

Share.

About Author

1 Comment

  1. HABIBHASAN-An American Storyteller on

    It’s Free For All! Why “!Special Ed! ” ? It’s like double Japordy fiesta! …. No one talks about it! Why? Where is the Government now? ….

    Why are Children who are enrolled in a School District; later in 10 th Grade FOUND ” Mental on Paper” sent to BOCES? AND, The “Mother of the Child who very well knew that after a Club and Drinking she went with ( a any guy) and slept with him! Got Pregant and had the Baby ( not to mention out of wedlock) and “started earning 50% Pension PLUS The Taxpayers Welfare Money; AMERICA is asking it was “not out of a mistake” but as a Norm! And, the Woman knew how to make a FREE LIVING! And, the Present ( under the Context of Education ) System where THE COUNTRY AND IT’S REAL FAMILIES are being CHEATED. Why?

    Is this a game of fooling the American Family and Their Values! Again! Not to mention what exactly are they educating the American Children ” cartoons known as Manga and PROBABLY THE FBI must PICK A FEW BOOKS AND READ THEM.what is being conveyed to 15 Years olds! Just for the beginners FYI The Names of Cartoons are ” BIN ” Yes! And, why and what they are corrupting in the NEW Generation Mind! An example of such was the act by Timmity McMeah’s KOUSIN did in A Cinema in Calarado! ….

    It’s so amazing!

    HABIBHASAN-An American Storyteller