Federal Law

Civil Conspiracy at Houston Gateway Academy Charter School Ends Up With Extremely Split Sentencing

While superintendent of Houston Gateway Academy Richard Garza awarded a contract to a company who would kickback most of the funds.

LIT COMMENTARY

Superintendent receives 5 year jail sentence along with restitution but the co-conspirator receives not a single day of jail time for hot-roddin’ taxpayer funds…should be a lawyer!

Former charter school official sent to prison for embezzling funds

APR 9, 2021 | REPUBLISHED BY LIT: APR 14, 2021

HOUSTON – The former superintendent of Houston Gateway Academy has been ordered to federal prison after taking more than a ¼ million dollars, announced Acting U.S. Attorney Jennifer B. Lowery.

Richard Garza, 61, Houston, pleaded guilty Sept. 20, 2019.

Today, U.S. District Judge Ewing Werlein Jr. sentenced him to serve 60 months in prison to be immediately followed by three years of supervised release. He was further ordered to pay a $20,000 fine and restitution in the amount of $191,292 to the Texas Education Agency (TEA). At the hearing, the court noted Garza led a double life and had a desire for taking money from others which got him into trouble and led him to his situation today.

Houston Gateway Academy is a charter school located in the Gulfgate area of Houston. While superintendent, Garza awarded a contract to a company whose owner then sent funds back to Garza.

As part of his plea, Garza admitted he awarded a $280,000 no-bid contract to Ahmed Bokaiyan. Bokaiyan was an IT employee at the school who also owned  a business called Hot Rod Systems. Bokaiyan, through his company, was to provide IT equipment and services to a new school not yet constructed.

An audit revealed Garza paid three checks totaling approximately $252,757 to Hot Rod Systems before it completed any work. Shortly after Bokaiyan received the payments, he sent approximately $164,381 via wire transfer to Garza’s personal bank account. Garza then used some of the funds to purchase a New Nissan Armada SUV and a condominium located on Gentryside Drive in Houston.

Garza was permitted to remain on bond and voluntarily surrender to a U.S. Bureau of Prisons facility to be determined in the near future.

Bokaiyan, 58, Houston, had also pleaded guilty for his role in the scheme and was ordered to pay $156,595 in restitution.

The Department of Education-Office of Inspector General conducted the investigation with the assistance of the TEA. Assistant U.S. Attorney Quincy L. Ollison is prosecuting the case.

Former charter school official sent to prison for embezzling funds

APR 9, 2021 | REPUBLISHED BY LIT: APR 14, 2021

The head of a Houston-area charter school and another school employee have been indicted on federal embezzlement charges, accused of siphoning more than $250,000 from the school for themselves and using some of the money to buy a car and condominium.

A grand jury in the U.S. District Court’s Southern District of Texas handed up charges this week against Houston Gateway Academy Superintendent Richard Garza, including one count of conspiracy, two counts of theft concerning programs receiving federal funds, three counts of wire fraud and two counts of engaging in monetary transactions involving criminally acquired property. Ahmad Bokaiyan, a technology support specialist at the school, was charged with conspiracy and three counts of wire fraud. They are now considered fugitives, according to a federal court records.

Attempts to reach Garza and Bokaiyan were unsuccessful. An employee who answered Houston Gateway Academy’s phone on Thursday said she had not seen either employee for several days and did not know whether they or the school had retained legal counsel. Attorneys for Garza and Bokaiyan were not listed on the indictment or the federal docket.

Houston Gateway Academy, Inc., has more than 2,400 students across three campuses in the Greater East End near Golfcrest. The charter district is working to build a fourth campus just south of Beltway 8 and west of Interstate 45 South.

According to the indictment, Garza awarded a $280,841.85 no-bid contract in 2014 to a group called Hot Rod Systems to build an IT infrastructure at the new school, even though construction on the school had not yet begun. Hot Rod Systems was owned by Bokaiyan. Prosecutors say the two Houston Gateway Academy employees agreed that Bokaiyan would wire some of that contract money into one of Garza’s personal bank accounts. Within days of receiving the contract money from Garza, Bokaiyan wired the superintendent $164,381.

The indictment alleges Garza used more than $50,000 of those funds to buy a new Nissan Armada sport utility vehicle, more than $86,500 to help purchase a condominium, and nearly $26,000 to help make payments on a house loan in Cypress.

It is not the first time finances have landed the charter school district in trouble. The Texas Education Agency in 2013 found that the Gateway schools charged parents fees to enroll their children in violation of state law. In that case, a TEA director called the superintendent of Houston Gateway to explain the fee was not allowed after the Chronicle asked the agency about the letter. The superintendent pledged to halt the fee, TEA officials said.

TEA Spokeswoman DeEtta Culbertson said on Friday that the agency was investigating the charter group but would not say what the probe entailed. She would not say whether the investigation could lead to sanctions.

“Because we currently have an open investigation on Houston Gateway, we cannot offer any comment or answer any questions,” she wrote in an email.

The school also was under investigation in 2017, when the TEA denied the network additional charters pending the outcome of an investigation into “misuse and misapplication of public funds.” Culbertson could not say whether the current investigation is the same as the 2017 probe.

In 2017, Gateway leaders said they wanted to expand and grow their enrollment to about 9,600 students.

Garza came to the charter network in 2006, at a time when the district was struggling academically and financially. He began an aggressive plan to improve academics on state-mandated standardized tests, placing countdown clocks to test days in all classrooms and requiring even the youngest students to complete three-ring binders filled with practice tests and worksheets. As a result, their Coral middle school campus shot up the nonprofit Children at Risk’s annual school report card rankings, rising to the ranking’s number three spot. All of its 110 fifth and sixth grade students passed the math portion of the STAAR, an exceedingly rare feat for any school, let alone one that serves predominately low-income students.

Garza also bought property to get the campus out of a mortgage and stopped paying bills, telling the Chronicle in 2017 he offered debtors the chance to sue.

“I used the word so many times at the beginning it was ridiculous: ‘So what? Sue me,’” he recounted.

Harris County civil court records show that several firms took him up on that offer. One construction group sued for commercial debt in 2013, another firm sued for the same in 2014 and two others sued over unpaid bills in 2017. All but one have been dismissed by the plaintiffs or the court.

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Civil Conspiracy at Houston Gateway Academy Charter School Ends Up With Extremely Split Sentencing
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