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November 15, 2013 at 1:57 PM

Former Seattle schools manager sentenced to 43 months in prison in theft scheme

Silas Potter Jr., the disgraced former head of a Seattle Public Schools small-business program, was sentenced to 43 months in prison today for a theft-and-kickback scheme tied to no-work contracts.

“I let down a lot of people,” a contrite Potter told King County Superior Court Judge Michael Trickey, who imposed the sentence.

Potter, 62, pleaded guilty in April to 36 counts of theft in a case that rocked the school district.

In a plea agreement, Potter admitted he approved dozens of school-district checks paying for services from a Tacoma nonprofit called Grace of Mercy, while “knowing no work had been completed.”

In return, Potter said he received some of that money back from David A. Johnson, who ran the nonprofit, which billed the district for classes it was supposedly teaching to small-business owners.

On Nov. 8 a Superior Court jury convicted Johnson of 30 counts of first-degree theft and six counts of second-degree theft.  He was scheduled to be sentenced Jan. 10.

Between 2007 and 2010, Potter and Johnson agreed to bill the school district a total of $168,275 for training that was never performed, according to court documents.

Checks for falsified work invoices were mailed to Grace of Mercy at Johnson’s home address.

Potter admitted Johnson returned about half the money to him in cash. He pleaded guilty to 30 counts of first-degree theft and six counts of second-degree theft.

As the head of the school district’s Regional Small Business Development Program from 2006 to 2010, Potter oversaw efforts to teach minority- and women-owned businesses how to better compete for public contracts.

The program started small, but Potter, a former furniture salesman, grew it into a $1 million-a-year effort that was praised by some prominent minority community leaders, including some who were paid as consultants.

But it came crashing down when Potter became a central figure in the 2011 financial scandal that erupted after a state audit found he had abused his authority and potentially squandered millions of dollars in public money.

Auditors discovered Potter’s program had spent $280,000 — including the payments to Grace of Mercy — for work that was not done or didn’t benefit the district, and $1.5 million more for services that were poorly documented or of questionable value.

A follow-up audit last year turned up $1.3 million more in suspicious payments, finding Potter had approved inflated invoices to vendors charging double or even 10 times the usual rates for services.

The audits and a related school-district report portrayed an office that Potter had turned into a personal fiefdom, doling out public contracts to favored vendors while spending time on school computers looking at dating and gambling websites. His conduct was abetted, the reports found, by superiors who failed to rein him in despite warnings.

The fallout led the Seattle School Board to fire then-Superintendent Maria Goodloe-Johnson, who died at age 55 last year after battling cancer.

0 Comments | Topics: financial scandal, Seattle Public Schools, Silas Potter Jr.

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