MUSD IN CRISIS: Board Member Ben Cardenas and CBO Ruben Rojas Lead Cover-Up of Financial Corruption at Montebello School District

 

Editor’s note: Readers can start a Facebook thread at the end of the story.

By Brian Hews

From the beginning of his employment, Montebello Unified School District’s (MUSD) Chief Business Officer Rueben Rojas has been a lightning rod of controversy.

It was first reported by Hews Media Group-Community News that Rojas had a very troubling employment background, which included lying to both Governor Brown and the MUSD on his resume.

The wide-ranging exposé revealed that everywhere Rojas was employed, allegations of fraud followed, with his subordinate employees eventually figuring out that Rojas possessed a complete lack of knowledge in the most rudimentary business practices.

As a consequence, many of Rojas’ employees resigned, were fired, or placed on leave due to his incessant harassment.

Within one or two years at each position, Rojas would leave or be fired; and he would not include those employment stints on future employment resumes or worse, lie about his success at the positions all together.

Now the same scenario is taking place at MUSD, with Rojas uniting with Ben Cardenas and his Board allies to take MUSD down a similar path of corruption.

HMG-CN has exclusively obtained letters from the accounting firm of Vasquez and Company LLP (Vasquez), the firm retained to audit the school district, that warn of an ongoing financial scandal of immense proportions being guided by Rojas.

The letters accuse Rojas and his management team of, among other things, fraudulent financial transactions, abuse, waste, and handing out sole-source contracts to family and friends.

The letters also implicate certain MUSD Board members, along with Rojas, used highly questionable stall tactics to delay the public release of Vasquez’ findings of waste, fraud, and abuse.

The letters paint a picture of Rojas firing those that questioned him, some in crucial positions at MUSD, in a wide-ranging plan to conceal blatant financial improprieties.

Most disturbing, the letters will show that then-Board President Benjamin Cardenas deliberately misled everyone at MUSD declaring at the Dec. 7, 2016 Board meeting that “an audit was needed” knowing Vasquez was nearly done with their audit.

Cardenas, who is the Assistant City Manager for the city of Pico Rivera earning a hefty six-figure annual salary, called for the audit to implement his strategy and deflect attention away from Vazquez’ findings.

Those findings will likely implicate Rojas and his team, Cardenas, and his allies on the Board in the huge financial scandal that is certain to embroil the entire school district.

The letters, all written in 2016, are dated December 1, December 9 and finally December 29.

 

First Letter

The December 1 letter, signed by Margaret J. McBride, Principal at Vasquez, was sent exclusively to then-Board President Cardenas.

 

 

 

 

The letter did not mince words and implicitly indicated they had found fraud linked to Rojas and wanted to meet with the Board in closed session.

The one-page letter stated, “it has come to our attention that the district has recently terminated it’s Chief Executive Officer, former superintendent Susanna Contreras, and Chief Financial and Operations Officer Cleve Pell.”

“We also understand that in recent months the District has experienced the departure of other individuals in key financial management positions.”

The positions included the Budget Control and Accounts Payable Manager, Fiscal Services Manager, Chief Information Technology Officer, and the Controller.

The involuntary departures were specifically meant to interfere with any financial audit looking for fraud.

The letter went on, “accusations regarding Mr. Rojas’ qualifications and integrity have been publicly aired (the HMG-CN exposé on Rojas), and we also have been independently made aware of other allegations of impropriety.”

The letter ended with a request to meet board members in a closed session to “discuss the impact of the (new fraud revelations) on our ability to complete the audit.”

The letter was ignored by Cardenas, Rojas, and Interim Superintendent Martinez.

Six days later, during the Dec. 7 Board meeting, Cardenas and his allies implemented their deflection strategy to draw attention away from Vasquez’ findings as outlined in the first letter.

At the meeting, Cardenas suddenly called for an “audit of the MUSD” even though Vasquez was nearly done and the State mandated deadline was in eight days.

Board President Cupchoy and Board member Flores quickly agreed with Cardenas.

Board member Chacon voted yes but wanted to “talk to the new audit team personally so I can tell them where to look.”

Interim Superintendent Martinez also agreed with the new audit.

 

Second Letter Marked URGENT-

The second letter was sent two days later, this time to all MUSD Board members and MUSD attorney Rick Olivarez, on December 9, with URGENT in bold at the top of the letter.

 

 

 

 

McBride stated, “we previously wrote to Mr. Cardenas regarding a meeting with the Board of Education in closed session, we have not received a response to that letter.”

The letter strongly implicated fraudulent cover-up and financial improprieties by Rojas and his team.

Aiming her comments at the Board, McBride stated, “certain audit procedures have been delayed due to the actions of the District management.”

McBride called for, “other audit procedures (fraud investigations, related party transactions, and no-bid contracts) to be expanded as new information has come to our attention.”

The letter closed with McBride saying, “we reiterate our request for a meeting with the Board to obtain authorization to expand our audit procedures, complete the audit, and render our opinion.”

Once again, Cardenas, Rojas and Martinez ignored the letter, and Cardenas’ Board allies refused to meet with Vasquez in closed session.

 

Third Letter-Rojas Fires Vasquez, Hires Another Audit Firm

The third letter was sent – once again to all MUSD Board members and MUSD attorney Rick Olivarez – by Ms. McBride on December 29.

This time the letter went much further, strongly implicating Rojas’ financial improprieties and a cover-up by his Board allies in an effort to keep the corruption from public view.

 

 

 

 

 

McBride wrote, “On December 22, Rojas stated that he had been directed by the Board to terminate the services of Vasquez. Rojas gave no reason for the termination and stated that another firm would be retained to the conduct the audit.”

McBride stated that the District will incur higher fees, miss the deadline for California, and was in danger of missing Federal deadline.

“We asked if Mr. Rojas advised the Board of these facts and he declined to answer.”

The letter then addressed the Board and slammed Rojas and his team.

“It is important that we inform you (the Board) at the time of our termination we had revised our risk assessment of the district to ‘high risk’ and accordingly expanded our audit procedures to include the areas of fraud, related party transactions, and competitive procurements.”

Translation: Rojas was handing out checks to family members and friends using no-bid sole-source contracts.

“The higher risk was due to numerous factors including communications from several sources alleging fraud in the Business Office, the high-level of turnover in top management, and the inability to communicate with Mr. Rojas.”

The letter went on to describe how Vasquez and McBride had been chasing Rojas and his team since October 20, 2016, “to perform procedures concerning risks and allegations of fraud, information technology controls, and litigation exposure.”

The sources in the Business Office were likely MUSD Superintendent Susanna Contreras and Chief Financial and Operations Officer Cleve Pell.

Fourteen days later, on Nov. 4, 2016, the Board placed Contreras and Pell on administrative leave.

The letter also pointed at Interim Superintendent Martinez as complicit in the cover up.

“The call from Mr. Rojas to terminate (Vasquez) occurred within 45 minutes of our request directly made to Martinez for additional documents as part of our expanded audit procedures.”

The letter then went on to implicate that Cardenas and his Board allies were also in on the cover-up.

“In our letter to Cardenas on December 1, and again in our letter to the Board dated December 9, we requested a meeting to go over the audit findings and expanded (fraud investigation) procedures, that request has not been granted.”

McBride angrily ended her letter stating, “Vasquez will retain our working papers (audit documents) for seven years, however the audit documents are the property of Vasquez.”

Board member Hector Chacon, an outspoken critic of Rojas, told HMG-CN, “”I was perplexed but not surprised at all, why a reputable and well respected accounting firm was suspiciously terminated in light of the findings pertaining to Ruben Rojas. To this date, no one from the District has given me any sound or logical reason as to why they terminated Vasquez. I certainly saw no harm at all by waiting to hear what their findings were, but instead Ruben Rojas recommends that the Board bring in another firm-whom I believe Rojas knows, to do another audit.”

“It has been my experience going back to last year, anyone who questions or challenges the CBO’s authority is fired, terminated or demoted. Luckily for me, I answer and work for the voters of our community and not Ruben Rojas, and this is why I will continue to fight and advocate for our students, parents and employees of MUSD, while I serve on this Board.”

Chacon ended saying, “This is also why I support a State Audit. I only hope they don’t get swayed by Ruben Rojas about where to look.”

Chairperson of MUSD Personnel Commission Charlie Pell said, “Firing professional auditors for doing their job when they uncover and further investigate signs of fraud is a pretty clear sign that they found something that Mr. Rojas and some involved board members wanted to keep hidden from the public. I have to ask myself, what did the auditors find, which caused the district to immediately fired them and effectively have to pay double to hire a new auditing firm? And I can’t believe that Mr. Rojas was given the power to fire the auditing firm, given all the issues in his background.”

And the Rojas issues and attempt to cover-up his corrupt practices are not going away.

At the January 19 meeting, the Board voted to hire San Diego based Christy White and Associates to audit MUSD, paying White $88,000.

Chacon voted no, saying “I do not trust anything Rojas does.”

The recommendation to hire White was made by Rojas.

As of the publication of this article,  nearly two months after the hiring, no findings by White have been made public regarding the new audit.

One observer told HMG-CN, “No doubt a few board members and a few administrators, along with a pocketful of select vendors working at MUSD, were more than interested in seeing the Gil Vasquez & Associates audit stopped, or the report buried under, or tied to, the front of Metro Rail’s Gold Line Eastside Extension, taking the first train out of town. Perhaps the MUSD should hire the Capstone Advisory Group, find someone to toot the whistle again, and get a federal inspector on board!”