Category Archives: Legal issues

Courier-Journal: U of L grant funds end up in local bank (updated story)

Three checks totaling $450,000 — money that former University of Louisville education dean Robert Felner said was intended to pay for research — instead ended up being deposited in a Louisville bank, records show.

The records, which The Courier-Journal obtained in an open-records request, don’t identify who deposited or endorsed the checks. But Felner’s lawyer, Scott C. Cox, said yesterday that his client is cooperating with federal investigators in “locating and reimbursing any funds that could be in question.”
Cox declined to say how much Felner is paying back. He has said that Felner is the focus of a federal investigation into the possible misappropriation of federal grant money that he controlled.

The records show that BB&T posted a check made out to “Natl Ctr on Public Education Prevention” for $200,000 on April 10, 2007, that had an endorsement stamp saying “credited to the account of the within named payee in accordance with the payee’s instructions.”

A second check for $50,000 on July 31, 2007, was endorsed with a stamp from the “National Center on Public Education and Prevention Inc.,” or NCPE.

A third check for $200,000 on Jan. 4 of this year had a hand-written endorsement of “NCPE. Deposit only.”

Wes Beckner, the regional president for BB&T, said the bank is cooperating with the investigation.

“We are giving them what they need,” he said, declining to elaborate.

The records show that U of L issued three checks totaling $450,000 to the National Center for Public Education and Prevention Inc. in Illinois, whose president is Thomas Schroeder, Felner’s colleague and friend.

Schroeder’s lawyer, Herbert Schultz, said yesterday that, at Felner’s request, Schroeder returned to Felner the only two checks he was sent, which totaled $250,000. Schroeder previously said he didn’t know about a third check for $200,000.

But university officials said none of the money was ever returned to U of L.

U.S. Attorney David Huber declined to comment on the checks or whether Felner is making reimbursements.
Checks came from grant

The money for the checks came from a $694,000 federal grant received by U of L’s Research Foundation. Felner — who headed the university’s College of Education and Human Development from 2003 until June — directed the grant, which was intended to create a center to help schools boost achievement under the No Child Left Behind law.

Schroeder’s Illinois center is a nonprofit corporation that Schroeder has said he set up in 2001 at Felner’s request. The state dissolved the Illinois center in 2006 after Schroeder failed to file the required paperwork with the secretary of state.

Schroeder told a newspaper in Rock Island that he was the fiscal agent for the grant project but wasn’t aware of any work the center produced.

The three checks for $450,000 were deposited in Louisville under an account bearing the same name as the Illinois center but listing a phone exchange at U of L. The number’s last four digits were not legible in the copy of the check provided the newspaper.

U of L spokesman John Drees declined to comment yesterday on the checks or anything related to the federal investigation.
Team since early ’90s

Felner and Schroeder worked together on projects dating to Felner’s employment as a psychology professor at the University of Illinois in the early 1990s.

Felner later worked as a professor and director of the School of Education at the University of Rhode Island, before being hired as U of L’s dean of education in 2003.

University of Rhode Island officials confirmed this week that Schroeder was paid about $53,500 from August 1997 to June 2001 to work as a consultant on various projects involving Rhode Island’s National Center on Public Education and Social Policy, which Felner directed until 2006.

Felner also hired Schroeder to work as a consultant at U of L in 2004, and he later hired Schroeder to work as his personal grant research assistant from 2005 until this past April, paying Schroeder $2,400 a month.

Schroeder is executive director at the Rock Island County Council on Addiction and president of the Riverdale Community Unit School District No. 100 Board of Education.

So far, no documents have suggested any grant-related research was conducted in Kentucky. The other subcontracts in the grant to come to light include two $60,000 contracts with the University of Rhode Island’s National Center on Public Education and Social Policy.

Officials there said that in the first, a 2006 contract, data on public schools were collected from schools in Rhode Island and Buffalo, N.Y. In a 2008 contract, data were collected from Rhode Island schools only, according to the university.

Follow

Courier-Journal: U of L grant checks end up in local bank

Three checks totaling $450,000 — money that former University of Louisville education dean Robert Felner said was intended to pay for research — instead ended up being deposited in a Louisville bank, records show.

The records, which The Courier-Journal obtained in an open-records request, don’t identify who deposited or endorsed the checks. But Felner’s lawyer, Scott C. Cox, said his client is cooperating with federal investigators in “locating and reimbursing any funds that could be in question.”

Cox declined to say how much Felner is paying back. He has said that Felner is the focus of a federal investigation into the possible misappropriation of federal grant money that he controlled.

The records show that BB&T posted a check made out to “Natl Ctr on Public Education Prevention” for $200,000 on April 10, 2007, that had an endorsement stamp saying “credited to the account of the within named payee in accordance with the payee’s instructions.”

A second check for $50,000 on July 31, 2007, was endorsed with a stamp from the “National Center on Public Education and Prevention Inc.,” or NCPE.

A third check for $200,000 on Jan. 4 of this year had a hand-written endorsement of “NCPE. Deposit only.”

Wes Beckner, the regional president for BB&T, said the bank is cooperating with the federal investigation.

“We are giving them what they need,” he said, declining to elaborate.

The records show that U of L issued three checks totaling $450,000 to the National Center for Public Education and Prevention Inc. in Illinois, whose president is Thomas Schroeder, Felner’s colleague and friend.

Schroeder’s lawyer, Herbert Schultz, said that at Felner’s request, Schroeder returned to Felner the only two checks he was sent, which totaled $250,000. Schroeder previously said he didn’t know about a third check for $200,000.

But university officials said none of the money was ever returned to U of L.
U.S. Attorney David Huber declined to comment on the checks or whether Felner is making reimbursements.

Follow

Courier-Journal: Felner feared loss of house, U of L job, e-mails show
E-mails show concern over center’s tax status

Federal agents and prosecutors expect to complete their criminal investigation of the University of Louisville’s former education dean within four to six weeks and are aware of e-mails indicating that he believed months ago that his job was at risk, U.S. Attorney Dave Huber said yesterday.
Advertisement

Huber said the e-mails were seized about two months ago, during a search of former dean Robert Felner’s office and computer. “We are aware of them and a lot of other things,” he said, declining to elaborate.

Follow

UPI.com: Feds wrap up U of L dean investigation

LOUISVILLE, Ky., July 30 (UPI) — A criminal investigation of a former University of Louisville, Ky., education dean is expected to wrap up within six weeks, officials said.

Robert Felner’s office and computer, including emails allegedly expressing his concern about the nonprofit tax status of an Illinois organization to which he had funneled federal grant money, have already been searched, the Louisville Courier-Journal reported Wednesday.

“We really, really need the tax thing if we are ever going to get out of this hole,” Felner wrote last April to friend and former colleague, Thomas Schroeder, former director of the National Center on Education and Prevention in Port Byron, Ill., the report said.

U of L records show Felner used a $694,000 federal grant to make payments of $450,000 to Schroeder’s center. In return, the center was supposed to provide and administer education surveys to students, parents, teachers and school employees. However, there is no evidence any work was done, the Courier-Journal said.

Illinois records show Schroeder’s nonprofit corporation was involuntarily dissolved by the state after failing to file its annual report in 2005 — a year before the U of L payments were arranged.

Follow

Courier-Journal: Ex-dean feared for job, house
E-mails show concern over center’s tax status

Federal agents and prosecutors expect to complete their criminal investigation of the University of Louisville’s former education dean within four to six weeks and are aware of e-mails indicating that he believed months ago that his job was at risk, U.S. Attorney Dave Huber said today.
Advertisement

Huber said the e-mails were seized about two months ago, during a search of former dean Robert Felner’s office and computer. “We are aware of them and a lot of other things,” he said, declining to elaborate.

In the e-mails, which The Courier-Journal obtained from UofL under the Kentucky Open Records Act, Felner expressed concern that he’d lose his house unless he could show that an Illinois organization to which he had funneled federal grant money could prove it had tax-exempt status.

Felner, who was then dean of UofL’s College of Education and Human Development, doesn’t explain in the e-mails why his house or job might be in jeopardy, or why getting the organization declared tax-exempt would save them.

“We really, really need the tax thing if we are ever going to get out of this hole,” Felner wrote in April to his friend and former colleague, Thomas Schroeder, who was director of the National Center on Education and Prevention in Port Byron, Ill. “I am already needing to relentlessly look for another job as this one I have been told is probably not long,” Felner added.

Records previously released by UofL show that Felner had arranged for it to pay Schroeder’s center $450,000 from a $694,000 federal grant that’s the focus of the federal investigation.

Follow

WHAS11.com: Louisville, Ky. (WHAS11) – There is new information in the investigation into former University of Louisville Dean Robert Felner.

http://www.whas11.com/video/index.html?nvid=267596&shu=1

Felner is under investigation for allegedly mishandling federal grant money.

WHAS11 News has obtained copies of e-mails sent between Felner and Thomas Schroeder.

Schroeder is the director of a defunct non-profit corporation called the national center on public education and prevention.

That organization allegedly received $450,000 dollars from the University of Louisville for work that was never performed. In the documents Felner describes himself as terrified and nuts over concerns about the IRS. They also hint that perhaps Felner and Schroeder were more than just colleagues.

The first e-mail we obtained from Robert Felner to Tom Schroeder was about grants.

Schroeder wrote, “The grant idea is excellent.”

Felner replied, “Great. We need to do this quick. Good funding and no one is better at this than you.”

By that time, the National Center on Public Education and Prevention, Schroeder’s non-profit organization, had already been dissolved for not filing annual reports.

The next e-mail came in February of 2007.

Felner writes “hi honey,” and discusses getting together with Schroeder.

Felner ends the e-mail with the word “hugs”.

Four days later, Schroeder sent the University of Louisville a tax I.D. number so that it could serve as a contractor.

Then Felner arranged to send the center $450,000 dollars from a $694,000 dollar No Child Left Behind grant.

The grant that’s in question was an earmark that we secured for U of L but the money apparently ran out.

In December 2007, Felner wrote Schroeder saying, “This is starting to completely destroy my break.” he writes that he is concerned about “an IRS thing” that has him “terrified and nuts.”

In the next e-mail, Felner writes the “Situation is getting real dicey. I could lose my house and you too as your payments will be stopping.”

It’s not clear exactly which house Felner was referring to.

WHAS11 News discovered Felner owns four houses including a $700,000 dollar house in Prospect, a $1.4 million dollar home in Florida, a $300,000 dollar home in Florida and a $520,000 dollar home in Rhode Island that he co-owns with his ex-wife.

The total value of the homes is $2.9 million dollars.

On April 27th of this year, Felner refers to payments made to Schroeder “I’ve helped you with this for five years”.

Felner says “I am already needing to relentlessly look for another job as this one I have been told is probably not long.”

The e-mail came just weeks before Felner was hired as the new Chancellor of the University of Wisconsin Parkside.

Felner asks Schroeder to file a 990 tax form for the non-profit.

Schroeder writes back that he’s met with attorneys twice about the national center and will be calling the IRS compliance person.

It was around that time, the university began to investigate.

The final e-mail we received indicates the University of Louisville ended Schroeder’s payments of $2,400 dollars a month which began in November 2004.

WHAS11 News contacted both Schroeder’s and Felner’s attorneys.

Schroeder’s attorney said he had no comment.

Felner’s has not called us back.

Emails between Robert Felner and Tom Schroeder

Subject: HELP
From: “Robert Felner” r0feln01@gwise.louisville.edu
Date: Sat, 29 Dec 2007 10:17:06 -0500
To: RICCATDS@aol.com

Hi Tom,

This is starting to completely destroy my break. I spent three days trying to get a loan – not fun and chaos – been getting yelled at by RI – have my whole group who are not going to get paid very angry with me-and now am hanging around waiting for a fed ex guy who is not coming. All on top of two years of waiting for an IRS thing that has me completely terrified and nuts as well as multiple contracts/earmarks that never come. I love ya to pieces but please, I need just a little reliability and follow through on this stuff – all I ask in return for the ability to get you paid….please….it is creating great havoc in my life…..and some in yours..

Hugs
me

Robert D. Felner, Ph.D.
Dean and Distinguished
University Scholar,
College of Education
and Human Development
University of Louisville
Louisville, Ky. 40292
r.felner@louisville.edu
voice: (502) 852-3235
fax: (502) 852-1464

Subject: May 22-25
From: “Robert Felner” r0feln01@gwise.louisville.edu
Date: Tue, 5 Feb 2008 15:40:17 -0500
To: RICCATDS@aol.com

Tom

I’m looking at a meeting in Chitown those dates-possible for you?
R

Robert D. Felner, Ph.D.
Dean and Distinguished
University Scholar,
College of Education
and Human Development
University of Louisville
Louisville, Ky. 40292
r.felner@louisville.edu
voice: (502) 852-3235
fax: (502) 852-1464

Subject: Re: (no subject)
From: “Robert Felner” r0feln01@gwise.louisville.edu
Date: Fri, 16 Feb 2007 14:14:47 -0500
To: RICCATDS@aol.com

HI honey,

Next couple of weeks I am traveling-this was a great week but I understand about the weather> So, call me and we can try to find a time I am around.
Hugs
me

Robert D. Felner, Ph.D.
Dean and Distinguished
University Scholar,
College of Education
and Human Development
University of Louisville
Louisville, Ky. 40292
r.felner@louisville.edu
voice: (502) 852-3235
fax: (502) 852-1464

— RICCATDS@aol.com 2/16/2007 1:44 PM —

Robert:

I am interested in visiting the great cityof Louisville on Monday and Tuesday of next week. Is this a possibility with your schedule?

I will call your cell phone this afternoon and try to connect. The weather up here in this arctic wasteland has been awful this week.

Talk to you soon.

Tom

Subject: Re: (no subject)
From: “Robert Felner” r0feln01@gwise.louisville.edu
Date: Tue, 4 Mar 2008 09:43:01 -0500
To: RICCATDS@aol.com

I called-call me

Robert D. Felner, Ph.D.
Dean and Distinguished
University Scholar,
College of Education
and Human Development
University of Louisville
Louisville, Ky. 40292
r.felner@louisville.edu
voice: (502) 852-3235
fax: (502) 852-1464

— — RICCATDS@aol.com 3/3/2008 3:36 PM —

Robert,

I am hoping to travel to Louisville to visit you later this week, if that fits into your outrageous schedule. Please let me know. I could arrive on Wednesday evening, and leave Friday in the morning.

Thank you and see you soon.

Tom

Subject: (no subject)
From: RICCATDS@aol.com
Date: Mon, 21 Apr 2008 10:27:50 -0500
To: r0feln01@gwise.louisville.edu

Robert:

I have been trying to get in touch with you by hand held communications device. How are you? What do you think about the Yankees? Is Joe Girardi going to make it as Stenbrenner’s whipping boy? What did you think about the John Adams series on HBO? Don’t you feel the show depicted Adams as over the top sensitive, paranoid and insecure? Where are you and when does your schedule accomodate a visit from your old friend? Let me know, and take care.

Tom

Subject: Gotta
From: “Robert Felner” r0feln01@gwise.louisville.edu
Date: Sat, 26 Apr 2008 17:14:43 -0500
To: riccatds@aol.com

Tom,

Situation is getting real dicey. I could lose my house and you too as your payments will be stopping. I really need you to take care of this. Not manyana. Now. Please, for the sake of our familes and friendship.
Me

Subject: I need you to send me and submit
From: “Robert Felner” r0feln01@gwise.louisville.edu
Date: Sun, 27 Apr 2008 11:12:03 -0500
To: RICCATDS@aol.com

the 1099 I asked for showing $36,450

And I need it asap -ok? Please do not daudle on this. Then payments to you will stop in the next month or sooner. We really really need the tax thing if we are ever going to get out of this hole or get you additional payments or if I am not going to lose my house. I am already needing to relentlessly look for another job as this one I have been told is probably not long. Tom, I’ve helped you with this for five years asking very little back and the amount is HUGE….(54 x 3000) I’ve taken care of covering it MYSELF anticipating we would get the tax status and cover it in my accounts and new value we could show the university. Please do something as quick as humanly possible-I have checked with the IRS-the longest thhey have taken to respond is 7 months not 5 years.

Robert D. Felner, Ph.D.
Dean and Distinguished
University Scholar,
College of Education
and Human Development
University of Louisville
Louisville, Ky. 40292
r.felner@louisville.edu
voice: (502) 852-3235
fax: (502) 852-1464

Subject: Re: I need you to send me and submit
From: riccatds@aol.com
Date: Mon, 28 Apr 2008 15:01:49 -0500
To: r0feln01@gwise.louisville.edu

Robert:

In response to your email of 4/27, I am picking up the 1099 form that must be scannable for the IRS, and will complete the form, submit and mail to you. Also, I have met with the attorneys twice since last week about the National Center, and we will be conference calling with an IRS compliance person on Wednesday morning. I will continue to push and give them anything they request. I truly hope you have a better week. Take care.

Tom

Subject: Please send
From: “Robert Felner” r0feln01@gwise.louisville.edu
Date: Mon, 12 May 2008 09:34:11 -0500
To: RICCATDS@aol.com

1099 as requested – amt 36,400. And be on look out for check for final payment for data collection on project and call as SOON as received.

Robert D. Felner, Ph.D.
Dean and Distinguished
University Scholar,
College of Education
and Human Development
University of Louisville
Louisville, Ky. 40292
r.felner@louisville.edu
voice: (502) 852-3235
fax: (502) 852-1464

Subject: Re: Please send
From: RICCATDS@aol.com
Date: Mon, 12 May 2008 12:03:58 -0500
To: r0feln01@gwise.louisville.edu

Robert,

I completed the 1099 for $36,450. Would you prefer I send the form to your home or U of L address? Also, I will send the check to you as soon as it arrives, and I have had three conversations in the last two weeks with officials from the IRS regarding 501c3 status for the National Center, and I am re-submitting some of the forms of the application.

Whatever I can do for you, please know that I will. Take care, and I hope to talk with you and see you soon.

Tom

Subject: Re: Please send
From: “Robert Felner” r0feln01@gwise.louisville.edu
Date: Sat, 17 May 2008 18:12:12 -0500
To: RICCATDS@aol.com

Please send to
me at

P.O. Box 436 Harrods Creek KY (for a short time) 40027
Check to you soon.
Any progress?
Will talk to you next week. Right now trying hard to find a job.
Gotta get out of here.

Robert D. Felner, Ph.D.
Dean and Distinguished
University Scholar,
College of Education
and Human Development
University of Louisville
Louisville, Ky. 40292
r.felner@louisville.edu
voice: (502) 852-3235
fax: (502) 852-1464

— — RICCATDS@aol.com 5/12/2008 1:03 PM —
Robert,

I completed the 1099 for $36,450. Would you prefer I send the form to
your home or U of L address? Also, I will send the check to you as soon as it
arrives, and I have had three conversations in the last two weeks with
officials from the IRS regarding 501c3 status for the National Center, and I am
re-submitting some of the forms of the application.

Whatever I can do for you, please know that I will. Take care, and I
hope to talk with you and see you soon.

Tom

Subject: Re: I need you to send me and submit
From: “Robert Felner” r0feln01@gwise.louisville.edu
Date: Tue, 27 May 2008 07:18:27 -0500
To: riccatds@aol.com

Have not yet received the 1099 form. Any news on the IRS stuff. What happened on the conference call. This is URGENT.

Robert D. Felner, Ph.D.
Dean and Distinguished
University Scholar,
College of Education
and Human Development
University of Louisville
Louisville, Ky. 40292
r.felner@louisville.edu
voice: (502) 852-3235
fax: (502) 852-1464

— — riccatds@aol.com 4/28/2008 4:01 PM —

Robert:

In response to your email of 4/27, I am picking up the 1099 form that must be scannable for the IRS, and will complete the form, submit and mail to you. Also, I have met with the attorneys twice since last week about the National Center, and we will be conference calling with an IRS compliance person on Wednesday morning. I will continue to push and give them anything they request. I truly hope you have a better week. Take care.

Tom

Subject: Re: Please send
From: “Robert Felner” r0feln01@gwise.louisville.edu
Date: Tue, 27 May 2008 07:31:12 -0500
To: RICCATDS@aol.com

Have you sent this?

Robert D. Felner, Ph.D.
Dean and Distinguished
University Scholar,
College of Education
and Human Development
University of Louisville
Louisville, Ky. 40292
r.felner@louisville.edu
voice: (502) 852-3235
fax: (502) 852-1464

— — RICCATDS@aol.com 5/12/2008 1:03 PM —

Robert,

I completed the 1099 for $36,450. Would you prefer I send the form to your home or U of L address? Also, I will send the check to you as soon as it arrives, and I have had three conversations in the last two weeks with officials from the IRS regarding 501c3 status for the National Center, and I am re-submitting some of the forms of the application.

Whatever I can do for you, please know that I will. Take care, and I hope to talk with you and see you soon.

Tom

Follow

WHAS11.com: Former UofL employee questioned, claims he sent checks back to Felner

(WHAS)—We continue to learn more about the federal investigation into a former dean at the University of Louisville.

A former UofL part-time employee who has been questioned in connection with the disappearance of federal grant money said he sent the money back to Robert Felner.

Federal agents are investigating him in connection with a grant in which nearly $500,000 was spent, but no work is believed to have been done.

Thomas Schroeder, who was president of the now defunct National Center on Education and Prevention was contracted to receive $450,000 to collect data.

WHAS 11 news discovered that the non-profit company was dissolved by the state of Illinois in 2006, yet still received money from the university.

Schroeder, who was involved in several other grant projects with Felner, told the Rock Island, Illinois newspaper that he only received $250,000 in checks.

Schroeder also said when he was interviewed by federal agents about the grant, he told them he sent the uncashed checks back to Felner after he received them because Felner asked for them.

Schroder said in the Rock Island newspaper:

“I found out this was being investigated when two federal agents came to my home. There were some forged addendum to this contract and forged signatures of mine. This had been going on all along. Where the money is and what was done with the money we had nothing to do with.”

Courier-Journal: Grant money returned, man says

The director of a nonprofit agency tied to a $694,000 federal grant being investigated at the University of Louisville says he returned $250,000 in grant-related funds at the direction of former U of L education dean Robert Felner, who told him it was sent as a “mistake,” according to an Illinois newspaper.
Advertisement

Thomas D. Schroeder of Illinois told the Rock Island Argus Thursday that he acted as a fiscal manager for the National Center on Education and Prevention, which U of L documents show was contracted to receive $450,000 from the grant to provide and administer education surveys.

Follow

Rock Island Argus: Area man questioned in fraud case

A local school board president, who also serves as executive director of the Rock Island County Council on Addiction, has been questioned by federal agents in connection with an investigation into allegations that a former dean at the University of Louisville mishandled federal grant funds.

Thomas Schroeder, of Port Byron, said Thursday he is cooperating with investigators, and immediately returned money sent to his non-profit corporation in connection with a U.S. Department of Education grant to create a center to help schools boost student achievement on federal No Child Left Behind exams.

The project manager, Robert Felner, until recently was dean of the College of Education and Human Development at the university.

Mr.Schroeder was listed as director of the National Center on Education and Prevention Inc., a non-profit corporation he formed in Rock Island in 2001 at Mr. Felner’s request. He said the center had served as the fiscal agent in other projects supervised by Mr. Felner.According to reports published by the Louisville Courier-Journal, the center allegedly received $450,000 from a $694,000 federal grant to provide and administer education surveys in connection with the project.

Mr. Schroeder said that in 2007 the center received a contract for the project, which he signed and returned to Mr. Felner. It later received two payments, one for $200,000 and another for $50,000. Both checks were returned uncashed, he said, at Mr. Felner’s direction.

He said he is unaware of any other payments, specifically $200,000, made to the center.

His organization performed no work in connection with the project, and that was the last he heard about the project until two Secret Service agents knocked on his door last month, he said.

“I found out this was being investigated when two federal agents came to my home. There were some forged addendum to this contract and forged signatures of mine. This had been going on all along. Where the money is and what was done with the money we had nothing to do with,” Mr. Schroeder said.

Mr. Felner’s attorney, Scott Cox, could not be reached for comment Thursday. Earlier, however, he confirmed to the Courier-Journal that Mr. Felner is the subject of the probe.

University spokesman, John Drees, could not be reached for comment Thursday, but did say earlier in the week the university is cooperating in the investigation.

“We are investigating all leads as we typically do in fraud cases, which usually have a lot of fingers. We’ll follow them out,” said U.S. Attorney David Huber.

He declined to speak about specifics of the case.

Mr. Schroeder met Mr. Felner in late 1987 or early 1988 when Mr. Felner worked for the University of Illinois and Mr. Schroeder was working for RICCA.

Mr. Felner was involved with a state agency that evaluated substance abuse and alcoholism programs throughout the state. After that, Mr. Felner became an evaluator of large grant programs throughout the state, Mr. Schroeder said, and they had occasions to work together and became friends.

The National Center on Public Education and Prevention was formed in 2001 in Rock Island after Mr. Felner had moved to Rhode Island. “He called me and said, ‘I have this assessment which I can use to help schools determine where they need to improve. I need an organization to be the fiscal agent and catalyst for that’,” Mr. Schroeder said.

Mr. Felner even named the nonprofit, Mr. Schroeder said. “It all sounds a little funny now, but he didn’t want his name as a member of the board or staff member,” he said.

Mr. Schroeder became the executive director and fiscal manager. His job was to sign contracts, receive checks, take care of legal issues, get paid and send the rest of the money to Mr. Felner. On two projects, they also brainstormed and bounced ideas off one another.

Mr. Felner handled all the assessments and payment to those doing the research and analyzing the data, Mr. Schroeder said.

“I had no program responsibilities with the national center,” Mr. Schroeder said, adding that he didn’t know how the assessments were delivered.

They worked together on two projects before the contract with the University of Louisville. In 2002, the center received a $400,000 contract for a project with the Atlanta school district and in either 2003 or 2004 received approximately $125,000 for a project with the Santa Monica, Calif., school district.

For that work, he said, he was paid $3,000 a month as director of the center.

Mr. Schroeder admitted that in 2006 he failed to file required paperwork with the Illinois Secretary of State’s Office, and that the state considers the corporation to be dissolved. At that point, he said, the center wasn’t actively involved in any work.

In late 2006 or early 2007, Mr. Felner told Mr. Schroeder about a contract with the University of Louisville to do work with Louisville schools on a No Child Left Behind project.

Mr. Schroeder signed the contract and returned it to Mr. Felner.

“Shortly after that, a check arrived in Rock Island for $200,000. I called Dr. Felner at the university and asked, ‘What is this? What are we to do with this? He said the check was a mistake, it shouldn’t have been written and to send it back,” Mr. Schroeder said.

Mr. Schroeder said Mr. Felner seemed livid that the check had been sent. It was sent back to Mr. Felner.

Then about Christmas 2007, a $50,000 check arrived in Rock Island. Mr. Schroeder said he called Mr. Felner, who again said to send the check back. It was a mistake.

“When it got to this Louisville thing, we had no role. No role at all. We honestly didn’t think there was a contract because we had to send the checks back. I got the impression from that that it was a mistake and this wasn’t happening,” he said.

He said everything with the nonprofit corporation seemed legitimate until this happened.

“It just seemed like a good thing. It was a good way for schools to identify where improvement is needed in student achievement, parent involvement and various areas. That’s why it was such a shock when federal officers came to my house and started talking to me about all these things that weren’t done, and how they came to find there weren’t any students surveyed or teachers surveyed.”

Mr. Schroeder is upset that his name is involved. “I’m distraught about whatever might be possibly involved here. Yes, I’m mad. I’m betrayed,” he said.

“It is real strange. We were close friends and professional colleagues, then this happens.”

Mr. Schroeder also worked as a research assistant for Mr. Felner from Jan. 1, 2005, until this past April. He was paid $2,400 a month to search for programs and funding opportunities for the university.

Mr. Schroeder said he does not know from where he was paid — the university’s general fund or a grant — but had to provide federal authorities with records of the time he spent doing the work.

Mr. Felner’s last day with the university was June 30. He resigned to take a position as chancellor at the University of Wisconsin-Parkside. According to the Louisville Courier -Journal, he backed out of the job after the federal investigation became public on June 20.

Follow

Courier-Journal: Ill. director says he returned money from U of L grant

The director of a nonprofit agency tied to a $694,000 federal grant being investigated at the University of Louisville says he returned $250,000 in grant-related funds at the direction of former U of L Education dean Robert Felner, who told him it was sent as a “mistake,” according to an Illinois newspaper.
Advertisement

Thomas D. Schroeder, of Illinois, told the Rock Island Argus Thursday that he acted as a fiscal manager for National Center on Education and Prevention, which U of L documents show was contracted to receive $450,000 in funds from the grant to provide and administer education surveys.

Schroeder said he signed a contract for the project. But he said wasn’t aware of any work the center produced and never received the remaining $200,000.

“I found out this was being investigated when two federal agents came to my home,” he told the Rock Island newspaper.

Schroeder’s lawyer, Herbert Schultz, told The Courier-Journal that he was present at the interview but wouldn’t make his client available for further interviews. Schroeder did not responded to numerous messages at his work and home.

Follow

Courier-Journal: Head of Illinois nonprofit cooperating in U of L grant probe

The director of the defunct Illinois nonprofit that received the bulk of a $694,000 federal grant being investigated at the University of Louisville is cooperating with investigators, his attorney said yesterday.
Advertisement

Thomas D. Schroeder, of Illinois, was also on U of L’s payroll from 2005 to this April as a research assistant to Robert Felner, the former dean of U of L’s College of Education and Human Development at the center of the investigation.

Schroeder “hasn’t been charged, and I doubt he will,” said Herbert Schultz, his attorney in Rock Island, Ill. He declined to comment further.

U of L documents show Felner arranged approval for Schroeder’s nonprofit corporation — the National Center on Education and Prevention Inc., based in Port Byron, Ill. — to provide and administer education surveys as a subcontractor. Its contracts with U of L totaled $450,000.

But according to the Illinois secretary of state’s office, Schroeder’s corporation was involuntarily dissolved March 1, 2006 — a year before the U of L deal was struck — after it failed to file its 2005 annual incorporation report.

Schultz confirmed Schroeder’s nonprofit had “ceased operation” but did not offer further details, including when it ceased operation.

The grant was to be used to create a center to help schools — including those in Kentucky — boost student achievement on federal No Child Left Behind exams. But local and state education leaders have said they have never heard of the grant or its research. And it remains unclear what grant-related work Schroeder produced.

Schroeder also is president of the Riverdale Community Unit School District No. 100 Board of Education, and executive director at the Rock Island County Council on Addiction, which provides addiction treatment, substance-abuse prevention and family services.

Felner’s resume shows he and Schroeder worked together on a substance abuse and prevention study between 1990 and 1994 while Felner was a professor at the University of Illinois at Urbana-Champaign.

Felner’s attorney, Scott C. Cox, has said Felner denies any wrongdoing and is cooperating with investigators. Felner, whose last day at U of L was last month, backed out of a new job as chancellor at the University of Wisconsin-Parkside after the federal investigation became public June 20.

Follow

Courier-Journal: U of L grant went to defunct nonprofit group

Center’s director was paid as aide to education dean

The nonprofit Illinois corporation that was paid the bulk of a $694,000 federal grant now being investigated at the University of Louisville was dissolved a year before the U of L deal was struck, the Illinois secretary of state’s office verified yesterday.
Advertisement

Also yesterday, U of L provided documents showing that the man listed as director of the Illinois center — Thomas D. Schroeder — was on the university’s payroll from Jan. 1, 2005, until this past April.

Schroeder was paid $2,400 a month as a research assistant to Robert Felner, former dean of U of L’s College of Education and Human Development, who managed the grant, according to the documents.

Follow