Owner of closed Flushing preschool pleads guilty to fraud – QNS.com

Owner of closed Flushing preschool pleads guilty to fraud

By Alex Robinson

The owner of a government-funded Flushing pre-school pleaded guilty last week to participating in a fraud scheme in which he used public money intended for special needs children for his personal use, the U.S. attorney in Manhattan said.

Cheon Park, 46, of Manhasset, L.I., received hundreds of thousands of dollars in misdirected funds after illegally billing the state and city for expenditures at Bilingual SEIT & Preschool Inc., a school that offered preschool programs and special education services, according to U.S. Attorney Preet Bharara’s office.

Park’s school, which was at 150-07 Northern Blvd., came under scrutiny in 2012 when state Comptroller Thomas DiNapoli released an audit showing $1.5 million of the school’s funding had been improperly used to pay employees inflated salaries and to buy items that were never used in the school.

Park pleaded guilty to one count of mail fraud last Friday. He is scheduled to be sentenced July 29 and could face up to 20 years in prison.

The audit showed Park billed the state for a number of personal expenses, including a children’s bedroom set that featured two white, antique-finished night stands listed at $1,006 and two bedroom lamps with petite silk shades that cost $261. He also used $186,819 in tax-dollar funds to rent three buildings unrelated to the school, $60,280 for leases on three cars and $22,347 in interest expenses for his ex-wife’s loan.

DiNapoli also found Park had used $233,368 to pay 26 employees whose time and attendance could not be substantiated. The school paid Park’s ex-wife a salary of $369,081 over two years as Bilingual SEIT’s assistant executive director, but she actually performed the services of a payroll specialist, the audit said.

DiNapoli’s office determined her salary should be reduced by $107,380 over that time period.

The school also deprived tax authorities of a significant amount of revenue by listing top officials of the school, as well as certain other staff, as independent contractors rather than as employees, the audit said.

After the comptroller’s report was released, the city Department of Education soon canceled its funding for the school, which closed its doors that September.

“Park blatantly enriched himself to the tune of millions of dollars and deprived children with physical, developmental and emotional disabilities of the help they need,” DiNapoli said in a statement.

DiNapoli forwarded his findings to the Queens district attorney’s office, which then assisted Bharara’s office in the subsequent investigation.

Investigators found Park also received kickbacks from individuals he paid who performed little or no work for the school, according to the criminal complaint filed by Bharara’s office.

At Park’s request, these individuals kicked back as much as 50 percent of their fraudulent salaries to him, the complaint said.

From 2005-12, Bilingual SEIT received approximately $94.5 million in federal, state and city funds, according to the complaint, during which time Park falsely represented the amount of compensation the school was giving its employees on financial statements.

He also arranged to have the school pay for his children’s tutoring, paid his ex-wife and ex-sister-in-law for work they never performed and even had a Bilingual SEIT employee come to clean his home twice a week, the complaint said.

Reach reporter Alex Robinson by e-mail at arobinson@cnglocal.com or by phone at 718-260-4566.

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