Tuesday, March 8, 2011

Clown time is over? Fraud whistleblower asks Ronald McDonald House Charities to investigate what happened to $125,000 awarded to Save-A-Life for phantom Chicago Schools program and why records were "prematurely destroyed"

Chicago Schools CEO Arne Duncan, unknown woman, SALF founder/president Carol J. Spizzirri, and Ronald McDonald, January 12, 2005. According to a recent San Diego Reader article, Duncan called Spizzirri - a twice-convicted shoplifter who fabricated medical and college credentials and whose late daughter took out a protective order against her - "one of my heroes."

In a January 5 letter to the Inspector General of the Chicago Public Schools (CPS), fraud whistleblower Peter Heimlich requested an investigation into what happened to $62,000 paid to the Save-A-Life Foundation (SALF) to provide first aid training to students.

The lion's share was $49,000 arranged and signed off by then Schools CEO Arne Duncan for a matching grants program with Ronald McDonald House Charities in which SALF was contracted to train 18,000 students over two school years. (For years, Duncan was close to SALF and even appeared as an animated pitchman on SALF's website.)

The problem - for CPS and for Duncan, now Secretary of Education - is that the training may never have happened.

Yesterday the problem landed on the desk of Martin J. "Marty" Coyne, president and CEO of Ronald McDonald House Charities via another investigations request letter from Heimlich. The opening paragraphs:
This letter is to request that your company initiate a review to determine if $125,000 awarded to the Save A Life Foundation Inc. by Ronald McDonald House Charities and by Ronald McDonald House Charities of Chicagoland & Northwest Indiana was properly administered.

Further, this is to request a review to determine if the destruction of related financial and other records, confirmed in an e-mail sent last year by Doug Porter, CEO of Ronald McDonald House Charities of Chicagoland & Northwest Indiana, was premature and constitutes a violation of Ronald McDonald House Charities’ Records Management Policy.

If such reviews are conducted by your company, this is to request that upon completion all relevant documents and findings be made available for public inspection.
Here's Heimlich's letter on Scribd. Click here to download a copy.
Heimlich asks McDonald's House to review $125K Save-A-Life grants, destroyed files (+receipt conf.)

Here's a highlight:
(In a) July 4, 2010 e-mail, Doug Porter, CEO of Ronald McDonald House Charities of Chicagoland and Northwest Indiana wrote:

I’m sorry to report that those records being 6+ years old have been destroyed. We do not have any files left on this grant and given that we had turned down any future requests, never in a million years did I think they would ever be relevant again. But again, the records that you had (we discussed) seemed to be accurate. That $37,500 from our local chapter (matched by global) in 2004 was the only one I recall.

This appears to be a clear violation of the records retention guidelines as stated in Ronald McDonald House Charities’ Records Management Policy
Grant Administration - Administration of donations made by RMHC to other organizations - including applications and agreements. While Active + 10 years thereafter
McDonalds Charities Chicagoland CEO confirms $37,500 payment to Save-A-Life Foundation; records destroyed


What about Mickey D customers debating whether or not they should drop the change from their Happy Meals into the donation can next to the cash register?
(Past) and potential future donors to Ronald McDonald House Charities may harbor concerns as to whether their donations have been or will be properly administered. Given the uncertainties associated with the administration of the $125,000 RMHC awarded to SALF and what appears to be the premature destruction of related financial records, donors may harbor concerns regarding whether RMHC employees properly administered those funds. Donors may also harbor concerns regarding RMHC employees' relationships with SALF.
So how to determine how many Chicago Schools students received SALF first aid training courtesy of the $125,000 from RMHC?

Heimlich's letter offers this helpful suggestion with names of some folks who may not be lovin' it:
Should your company wish to locate that information, you may wish to contact members of SALF's 2009 executive board; former SALF employees Sid Blustain and Dane Neal, both named in SALF's October 14, 2004 press release about the CPS training program; and Saquan Gholar who, according to CPS records, was SALF's “Education Training Coordinator” for the program. Please find attached a list with contact information for these individuals.