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Southern University Work-Study Scam Under Investigation

Southern University Work-Study Scam Under Investigation
By Scott Dyer

A local district attorney has launched a criminal investigation into allegations that eight employees at historically Black Southern University defrauded the school’s work-study program for $167,317 by falsifying student time sheets.
Southern University System Vice President Ralph Slaughter says officials at the Baton Rouge campus discovered irregularities in 1999 and alerted Louisiana Legislative Auditor Dan Kyle about the problem.
But Slaughter, a former Louisiana State secretary of taxation and revenue, says he didn’t realize the extent of the fraud until Kyle completed a yearlong probe and filed a report Dec. 15.
“We’re trying to clean this up,” Slaughter says, noting all eight employees involved in the swindle have either resigned or been terminated.
Kyle’s auditors found that in some cases, the employees recruited students to participate in the scam, falsified time sheets for hours that the students never worked, and then split the money with them.
In some cases, the employees allegedly drove the students to their banks to ensure that they received a piece of the action, Kyle says.
For example, in one case, an employee reportedly took two students to a bank where they cashed work-study paychecks for hours that they never worked. The employee then allegedly gave the students $100 apiece from the paycheck proceeds, and kept the remaining $675, according to Kyle’s report.
In another case, Kyle noted that two employees were said to have filed false time sheets on behalf of a student with the understanding that the student would treat them to dinner. The paycheck totaled $536, and the student spent approximately $200 wining and dining the employees at an upscale Baton Rouge restaurant.
But students were not accomplices in all cases.
Kyle says his auditors found instances in which the employees filled out false time sheets on behalf of the unsuspecting students and cashed the checks without the students ever knowing it.
One employee allegedly added herself to the work-study payroll and filed false time sheets so that she received $778 while she was student-teaching on leave without pay from her regular job.
The work-study scam ran from January 1996 through May 1999, and involved 67 students, Kyle says.
Kyle says the scam was one of the most disturbing that he has encountered.
“This was money for needy students, and you had university personnel actively soliciting students for illegal activities. That just is unbelievable,” Kyle says.
The investigation took more than a year because auditors interviewed all 67 students who were implicated, Kyle says.
Kyle has turned his report over to East Baton Rouge Parish District Attorney Doug Moreau, who has launched a criminal investigation. Moreau says he plans to pursue possible prosecution of the employees and possibly some of the students who knowingly took part in the scam.
The local federal prosecutor, U.S. Attorney L.J. Hymel, is reportedly also looking into the matter since it involved federal funds.
Kyle identified the mastermind of the scam as Eloise Blount, the school’s former federal work-study coordinator.
During his investigation, Kyle’s auditors also discovered that Blount had allegedly falsified her own time sheets to receive leave that she had not earned.
Kyle’s report noted that, from April 1992 through February 2000, Blount received $44,772 for 3,379 hours in unearned leave.
Some of the bogus leave was paid to Blount after the school suspended her in November of 1999. And Kyle’s report noted that, during the eight-year period, Blount’s bogus claims for leave were approved by all three individuals who held the post of financial aid director, including the wife of Southern University System President Leon Tarver.
Cynthia Tarver served as financial aid director in the early 1990s, before her husband was hired to run the system.
Slaughter said none of the three financial aid directors are to blame for Blount taking the unearned leave.
Blount took advantage of the fact that Southern University doesn’t have a computerized accounting system to track employee leave, Slaughter says, noting that the school is in the process of implementing a new system that will prevent such abuses in the future.
Besides Blount, other school employees implicated in the scam are former financial aid employees Darrel Lee, Sandra Perry, Sharon Davis and Shirley Alexis Bell. Former work-study student Robert Jones, former athletics department employee Moses Dupre and former intramural department employee Richard Wilson were also investigated. 

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