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Apex Investigation Stonewall: District Claims Investigators Have Never Billed for Services

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Apex Investigation Stonewall: District Claims Investigators Have Never Billed for Services

November 10, 2018 - 07:35
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NEW ROCHELLE, NY --There was a major development today in the stonewalling by school officials with regard to the Apex investigation. After weeks of claiming they had no such record the District finally produced a copy of the contract under which T&M Protection was hired to investigate allegations of grade-fixing and a phony credit recovery scheme at New Rochelle High School.

One look at the “contract” shows why the District stonewalled efforts to obtain it under FOIL- it obligates the District to pay exorbitant fees and expenses but no one from the District actually signed the contract. It gets worse. And we still don’t have a full picture because the District is now implausibly claiming that six months into a high-priced investigation, T&M has never sent a bill for their services or expenses.

It will be easier for readers if I just lay this ongoing fraud and deception out in a first person narrative. Here is how this story has evolved over the past few weeks:

On October 25th, I filed a Freedom of Information request seeking:

“Documents pertaining to the agreement under which T&M Protection Resources was hired earlier this year to conduct an investigation related to Apex Credit Recovery Service along with all invoices and all related payments pursuant to that agreement.”

On November 1st, I received the following reply from the District Clerk:

“The records you are seeking are not in the possession of the City School District of New Rochelle. The private investigative firm was hired by our attorneys, Bond Schoeneck & King, not the School District, to investigate the APEX complaints.”

A few hours later I replied:

“Don’t be ridiculous.

You all know perfectly well if the records are possessed by some other entity you have to go get them.

Do you not recall we went through this baloney regarding financial records possessed by O’Connor Davies.

I want the records immediately and I am not paying for them either.”

The O’Connor Davis “baloney” refers to a 2014 effort by Jeff Kehl, Sara Richmond and BSK to cover up misdeeds by school board members Lianne Merchant and David Lacher both of who failed to make required disclosures on their conflict of interest statements. Initially the District claimed they had no such records even though they are legally required to have them and produce them for inspection on demand, they then said their accountants had them, then they demanded I pay $895 to cover the supposed cost of having a partner at the firm review the records before releasing them. I eventually got them, at no cost.

You can read about that baloney here:

New Rochelle School District Stonewalling on Additional Conflict of Interest Disclosure Forms for Current and Past Board Presidents

http://www.newrochelletalk.com/content/new-rochelle-school-district-ston...

On November 6th, having received no response I filed a formal appeal, as required under state law, to the head of agency, interim Superintendent Dr. Magda Parvey:

“APPEAL OF DENIAL OF FOIL REQUEST

Dr. Parvey

The district has unsuccessfully adopted this absurd position before.

If there are public records in the possession of a third party (previously it was financial records at O’Connor Davies) the District must obtain those records and provide them to me. This is not even a question; the law is quite clear on this point.

In the previous case, the District claimed its cost to obtain the records was $800+. I successfully refuted that absurd claim as well and was ultimately provide the financial records at no cost. So please do not come back and tell me anything about paying for the records.

I want you to instruct BSK to deliver the records to you and for you to deliver them to me. I would like that to happen today.

Under NYS Law you have 10 days to respond to my appeal and must notify NYS COOG.”

Later that same day I filed an entirely new Freedom of Information request:

“Let me cover my bases here while awaiting my appeal on this phony denial of my previous FOIL request.

This is a public records request.

I would like to obtain the following records:

For the period May 1, 2018 until the present, all invoices from and payments to Bond, Schoeneck & King including all supporting documents such as, but not exclusively, invoices from T&M Protection and payments to T&M Protection, any agreements with T&M Protection, and beyond just T&M, any and all time sheets, records of billable hours, travel & entertainment forms including related invoices and receipts and any other document submitted by BSK for purposes of billing the District during that period.”

On November 9th, I received an email purporting to be a response to two prior FOIL requests, one on 10/25 and another on 11/6. They are not responsive to my requests.

Let me draw the reader to the duplicitous nature of the response below. I made two completely distinct FOIL requests.

On 10/25 I requested T&M records. On 11/6 requested BSK records.

Also on 11/6 I filed an appeal to the denial of 10/25 requests on 11/1.

The email from the clerk on 11/9 is an admission that the District lied in their response on 11/1. Take your pick — that there were no such records, that BSK had no such records, that I was not entitled to District records in the possession of BSK. It also improperly conflates my 10/25 T&M FOIL with my 11/1 BSK FOIL, it provides no records or any response at all to my 11/1 BSK FOIL and it ignores my 11/1 Appeal of the Denial of my 10/25 T&M FOIL.

The 11/9 email is basically a pack of lies of omission and commission.

Here is the actual reply:

“Dear Mr. Cox,

In reference to your Freedom of Information Law requests dated 10/25/2018 and 11/6/2018, and further to our e-mail exchange, attached please find a copy of the executed agreement between Bond Schoeneck & King, PLLC and T&M Protection Resources, LLC, dated May 23, 2018. There is no signature by representative of our School District because the agreement was between BSK and T&M. There are no invoices from T&M or payments made to them by Bond Schoeneck & King pertaining to this agreement.”

I replied soon after receiving this email:

“This is not a correct response.

My FOIL for T&M records was denied.

I filed an appeal to the head of agency. Once that happens the head of agency must reply and send a copy to the NYS Committee on Open Government.

I also made a separate FOIL request for records from BSK.

You seem to be mashing this all together.

So, first Dr. Parvey needs to respond to my appeal. Second, you have to give me all the BSK records I requested or acknowledge receipt and request more time.

Obviously, the original denial was bogus but that is not my problem.

I expect a formal reply signed by Dr. Parvey where is she free to admit the denial of T&M records was improper.

I will set aside for now that the position of the District is that in six months of working on the Apex investigation T&M has not invoiced anyone for anything. I did not realize they were a charity!”

T&M Contract for Apex Credit Recovery Investigation

If you click the link you can read the contract yourself. As you do so, consider the rhetoric we have heard from the school board in the months since the murder of Valaree Schwab and the Attempted Murder of a student in a high school classroom by Bryan Stamps.

You do not need to be a lawyer to understand that the sole purpose of the District taking the unprecedented step of outsourcing the hiring of T&M to BSK is for one purpose and one purpose only, to create a fig leaf to hide what has occurred with the investigation. 

When you hear the “transparency” and “accountability” rhetoric coming from board members just keep in mind that for those of us who seek transparency and accountability from school officials the current board is no different than past boards in providing neither.

To see how this works in practice, look at the contract’s “confidentiality” section:

“All work performed by T&M and all work product of any kind generated in furtherance of the performance of its duties and mandates during this engagement will be deemed to be attorney-work product of Counsel.”

By asserting “attorney-work product” it is all exempt from FOIL. And THAT is the whole point.

Look at the “Introduction” section:

“This agreement shall confirm the engagement of T&M Protection Resources, LLC ("T&M") by Bond, Schoeneck & King, PLLC ("Counsel") to provide consulting and investigative services required in connection with Counsel's representation and rendering of legal services to your client, New Rochelle City School District, ("Client"), as described in the Scope of Services below.

Then look at the “Scope of Services” section: 

“T&M will provide investigative and consulting services in reference to allegations related to the credit recovery program at client's high school.”

With both sections in mind now look at the “Acceptance of Agreement” section: 

“If the Agreement is acceptable, please have it executed on behalf of Bond, Schoeneck & King, PLLC and on behalf of New Rochelle City School District and return a copy to me.”

In plain English, this says the contract goes into effect when representatives of both BSK and the New Rochelle Board of Education sign it.

No one from the District signed this agreement.

Anticipating this rather glaring omission, the District addressed the lack of a signature by making the absolutely absurd claim that “there is no signature by representative of our School District because the agreement was between BSK and T&M.”

Is that true? Nope.

How do we know that?

Look under the “Professional Fees” section:

“It is understood and agreed that Counsel is not financially responsible to T&M for any fees, costs, or expenses and that all such fees, costs, and expenses shall be paid by Client.”

BSK does not pay T&M, the District pays T&M. Got that?

So, how can the District claim with a straight face they are not a party to an agreement when they alone are required to pay for all of the services and related costs provided under that agreement?

The agreement specifically obligates the District to pay T&M and specifically excludes BSK from paying T&M.

Of course the District is a party to the agreement. It is why T&M lawyers put a signature line in the agreement for a representative of the New Rochelle Board of Education.

Now look at those fees! As much as $495 an hour. This is a rather expensive investigation and the agreement says the District is on the hook financially for the entire cost. Yet, no one from the District agreed to accept that financial responsibility so on what basis does it exist?

You do not need a law degree to know that all parties to a contract must sign a contract.

It appears T&M has strict rules about getting paid and getting paid promptly:

“Invoices are due upon presentment of such invoice. Payments received by T&M more than thirty (30) days after invoice date are subject to delayed payment charges of 1 ½ % per month.”

The APR on 1.5% monthly interest (compounded) is 19.56%. That is the sort of rate you see on a lousy credit card.

We know T&M has done work on the investigation. We know they conducted interviews, seized computers and files. We know they delivered a so-called “draft” report. And we know T&M does not take getting payed lightly.

Despite all this, the District claims T&M has never billed the District a penny. There was no upfront money, no monthly retainer, no expenses, nothing.

Recall, the District first claimed (on 11/1), “the records you are seeking (contract, invoices, payments) are not in the possession of the City School District of New Rochelle”, adding “the private investigative firm was hired by our attorneys, Bond Schoeneck & King, not the School District, to investigate the APEX complaints” which suggests that the District does not have invoices from T&M because BSK is paying the invoices. But the District later claimed (on 11/9) “there are no invoices from T&M or payments made to them by Bond Schoeneck & King pertaining to this agreement.”

So, neither the District not BSK has ever gotten an invoice from T&M or made any payment to T&M.

How many companies out there do work for six months but do not charge for that work? None that stay in business very long that is for sure.

The contract the District did not sign says the District is obligated to pay T&M. The District says BSK hired T&M. Seems to me when you “hire” someone it means they work for you and you pay them for that work. If BSK hired T&M they should pay T&M. If the District is paying T&M to do work that means the District hired T&M. This would all be quite simple if not but for BSK getting in the middle of it all. Which goes back to the big picture question that no one on the board seems to have ever asked: why is BSK involved in this at all?

Consider this: the first time the phrase “credit recovery” was bandied about at board meetings was in 2010 when the June graduation rates for minority students was shockingly low (55% Black/AA, 52% Hispanic). Credit recovery is not just about online services like Apex. It also includes having a student submit work for a course failed years earlier or making up an entire year of PE in 5 days or simply altering a grade on a transcript. All of these “credit recovery” schemes began as a way to inflate graduation rates after that 55/52 fiasco. The board President at the time was Sara Richmond. I spoke with her directly in 2010 to raise the alarm. She dismissed me out of hand. So, Sara Richmond was there at the beginning when all these illicit “credit recovery” schemes began and today she is the lawyer at BSK acting as the middle-man between T&M and BSK. For folks who still do not get it, a person with a rather large conflict of interest has been placed in the middle of an investigation into a grade-fixing scheme that began on her watch as board President.

How can the public have any confidence in a report produced under such suspicious circumstances? They cannot. If the contract is a fraud, and the billing for the work is a fraud it is reasonable to conclude the investigation itself is a fraud.

Any honest board member would have already asked to see the contract (until I provided it none had seen it), demanded to know why no one from the District signed the contract, and asked who is paying for the investigation, how much it is costing and, given what the District has claimed, why has T&M never sent a bill to anyone for their work over the past 6 months.

No board member has asked those questions or even the bigger question of why T&M was placed under a so-called contract where the District foots the bill but the actual work is hidden from the public in such an unprecedented manner.