CHICAGO (Reuters) – The former superintendent of a suburban-Chicago public high school district has been indicted on federal fraud charges involving the misuse of proceeds from a bond sale, the U.S. Attorney for the Northern District of Illinois announced on Thursday.
Lawrence Wyllie, 79, who retired in June 2013 from the position of superintendent of Lincoln-Way Community High School District 210, was charged with five counts of wire fraud and one count of embezzlement.
Wyllie has denied the charges.
The district sold $29 million of bonds in 2009 with $10 million of the proceeds earmarked for capital expenditures. According the indictment, Wyllie used at least $7 million of those proceeds to instead pay for school operating expenses.
The move concealed the district’s true financial health from the school board and the public ”by fraudulently appearing to lower the district’s net operating expenditures in its audited financial statements and its reported cost-per-pupil
calculation,” the indictment said.
Federal officials also alleged that at least $50,000 was used by Wyllie to build and operate a dog obedience training facility “that provided no benefit” to the district’s four high schools.
The indictment said Wyllie also misappropriated at least $30,500 in school funds for his own benefit.
Wyllie denied the charges, according to a statement from his attorneys Dan Webb and Bob Trevarthen.
“Dr. Wyllie did not receive any funds or profit as a result of the bonds issued by the school district,” the statement said. “All of the bond money referenced in the indictment was expended on school related issues.”
Each wire fraud charge carries a penalty of up to 20 years in prison, while the embezzlement charge could lead to a maximum sentence of 10 years. Wyllie’s arraignment on the charges has not yet been scheduled.
Reporting by Karen Pierog; Editing by Matthew Lewis