Detroit— A former high-level Detroit Public Schools administrator who started her own tutoring company to serve low-income students has been accused of federal program fraud and money laundering in an alleged scheme involving $6.17 million in federal funds for students in DPS and Highland Park schools.
The FBI seized multiple bank accounts belonging to Carolyn Starkey-Darden and her husband, Anthony Darden, after launching an investigation in 2011 into the couple and three of their businesses. The companies were formed to provide after-school tutoring to students who attended schools targeted for improvement on federal progress goals.
In the 39-page civilcomplaintfiled in U.S. District Court, federal prosecutors allege Starkey-Darden ordered the falsification of documents, including inputting false pre-test scores, creating fake individualized learning plans for students, forging parental signatures on monthly attendance records and submitting inflated invoices for unperformed services.
Student progress reports were doctored, FBI agents allege, and Starkey-Darden’s company billed for students who weren’t in class, according to the complaint.
The U.S. Attorney’s Office filed a forfeiture action in April after seizing more than $282,800 in accounts that belonged to Starkey-Darden, her husband and their companies.
Investigators said Starkey-Darden created her own proxy form for parent signatures, which removed parents from overseeing their children’s attendance, and instructed employees to forge parent signatures of tutored students.
The complaint is a civil action against the couple’s bank accounts, and they have not been criminally charged. Attorneys for Starkey-Darden and her husband did not return calls Wednesday. DPS officials did not respond to requests for comment.
Gina Bayala, a spokeswoman for the U.S. Attorney’s Office, declined comment.
The three companies under investigation are Grants ’N Such, MI Learning Unlimited and the Learning Unlimited Companies. Agents determined that from June 22, 2006, through Oct. 19, 2012, the companies received $6.17 million in federally subsidized program money.
Agents allege a general rule in the scheme was to give each potential student a fabricated pre-test score that was three to five grades lower than the student’s actual grade that school year.
In an email agents retrieved from Starkey-Darden to employees, Starkey-Darden allegedly wrote, “I put in some fake scores for a few kids at Denby, just to get their plans approved. When and if we get new ones from Edith, just replace what I put in.”
An employee sent Starkey-Darden an email saying she was confused about “making up the pre-test dates.”
Prosecutors allege Starkey-Darden falsified documents required by DPS and Highland Park schools for payment of logged tutoring hours.
Starkey-Darden, who was director of grant development for DPS, retired Oct. 31, 2005. She was the former director of Title 1 compliance at DPS, a job that involved the distribution of federal funds to local school districts.
Starkey-Darden filed articles of organization for one of her companies on July 20, 2005 — before her retirement. Starkey-Darden filed articles of organization for another company Nov. 2, two days after her retirement. Her husband entered into a contract with DPS for tutoring services on Nov. 1.
The case is set for a status conference at 9:30 a.m. June 20 before U.S. District Court Judge Laurie J. Michelson.