Convicted DPS vendor wants leniency for kickback scheme

Jennifer Chambers
The Detroit News

Convicted school supply vendor Norman Shy is begging the government for a lenient prison sentence for a $2.7 million bribery scheme he masterminded with 13 Detroit Public School officials.

Shy says because of his age, clean record and remorse, he deserves no more than three years in prison.

“The experience of living in this world teaches us that human beings, and human lives, are usually multifaceted, and that a person cannot be fairly judged on the basis of only one aspect of his or her life. Unfortunately, it is the character lapse that brings him before this court,” wrote Shy’s attorney, Christopher Andreoff, in a court filing.

But federal prosecutors say they do not believe Shy’s decision to deprive DPS schoolchildren of $2.7 million in public funds was the result of a single bad decision, a momentary impulse, or an isolated exercise of poor judgment. They want him behind bars for 70-87 months when he is sentenced Sept. 6.

“He devised and implemented his ‘encumbered funds’ system and, over the course of years, paid countless kickbacks to DPS principals in the form of prepaid gift cards (sometimes in amounts ranging from $500 to $3,000 per kickback), checks, cash, and home improvements,” Assistant U.S. Attorney Michael J. Buckley wrote in the government’s sentencing memorandum to the judge.

“Shy’s conduct was not spontaneous, but, instead, involved careful premeditation and planning, and repeated acts of deceit over a period of years. It is also important to note that the encumbered funds kickback scheme was Shy’s brainchild; he devised the scheme.”

Prosecutors oppose the leniency being sought by Shy, who filed a sentencing memo of his own on Aug. 18 that said he should be shown mercy because he accepted responsibility for his crimes. He will be 75 in October and is asking for a sentence of 30-36 months.

Shy also is asking the judge to look at 25 character reference letters sent to the court that show despite his “greed-filled actions” in recent years, Shy was an “honest, upright businessman” for most of his career.

Buckley, in a response filed Tuesday with U.S. District Court Judge Victoria Roberts, said the true loss to DPS students is “incalculable.”

“Defendant Norman Shy’s greatest sin was depriving Detroit schoolchildren, for years, of the opportunity to develop their greatest abilities, thereby robbing society of numerous future potential doctors, lawyers, scientists, teachers. Shy stole over $2.7 million, which could have been used to help Detroit kids develop their greatest abilities, by paying for books, laptops, supplemental teaching materials, field trips, and salaries for additional teachers. The true loss in this case is far beyond financial loss, and it is incalculable,” the motion read.

In May, Shy pleaded guilty to one count of conspiracy to commit federal program bribery and one count of federal income tax evasion. Shy owes DPS $2,768,846.93 in restitution.

Federal prosecutors allege the scheme, which started in 2002 and ran through January 2015, was hatched by Shy, who billed DPS for $5 million school supplies but delivered less than promised.

In return for the business, Shy allegedly paid bribes and gave kickbacks to 12 former and current DPS principals and one assistant superintendent in the form of cash and gift cards totaling $908,518.

Shy allegedly kept a ledger to record how much he owed defendants in the case.

As part of the case, Shy has forfeited several homes and bank accounts in the case. Prosecutors said they expect to collect $1.6 million in restitution from Shy.