Ex-Montgomery schools chief financial officer pleads guilty in $291K theft

Ex-Montgomery schools chief financial officer pleads guilty in $291K theft

The former interim chief financial officer of Montgomery Public Schools pleaded guilty to two ethics charges and two counts of lying to the attorney general’s office in connection with bilking the school district out of more than $291,000, Attorney General Steve Marshall announced Wednesday.

Brenda Palmer’s trial was set to begin Monday until she pleaded guilty to the four counts.

“Betraying the public’s trust is never acceptable and will not be tolerated in our state,” Marshall said in a statement announcing Palmer’s guilty plea. “In this case, Mrs. Palmer’s brazen corruption and utter disregard for the law was astonishing. My office will continue to identify and prosecute those exploiting the public sector for personal gain.”

Because Palmer is a habitual felony offender — she was previously convicted of first-degree theft of property — she faces between 10 and 99 years on the two ethics charges and two to 20 years on the lying charges when she is scheduled to be sentenced on Oct. 3.

Palmer was the interim chief financial officer for Montgomery Public Schools when the fraudulent billing scheme was perpetrated between November 2017 and April 2019.

Walter James, the former vice principal of JAG High School and Palmer’s accomplice in the scam, pleaded guilty in both state and federal court and is serving a five-year prison sentence.

James submitted fraudulent invoices from nearly a dozen sham companies that purported to provide the school district with books, professional development, and other goods or services.

But both Palmer and James knew that no goods or services were provided to the district.

After James created the fake invoices with Palmer’s help, Palmer used her position as CFO to ensure she and James were paid without attracting attention.

To avoid detection, Palmer forged at least two employees’ names on checks and other written instruments and directed employees under her to work overtime to prepare legitimate checks so the fraudulent ones would be less likely to be noticed, according to the attorney general.

Palmer then pulled out the fraudulent checks from the legitimate ones so that James could personally pick them up personally.

That step was necessary because the face of the checks showed addresses for the fake companies that were either non-existent or otherwise undeliverable. After James deposited the MPS checks into his Navy Federal Credit Union account, he paid Palmer with cash in the amounts she demanded, according to text messages between them, Marshall’s office said.

When examiners with the Alabama Department of Examiners of Public Accounts began their yearly audit of the MPS system in 2019, they requested supporting documents for many of the fraudulent checks. Palmer was asked to help produce some of those check files. Instead of providing those check files, Palmer shredded them and claimed that she bypassed procedures because she just wanted to get vendors paid.

When confronted by the new CSFO, Palmer resigned, walking away with her pension, which she earned until pleading guilty, Marshall said.

Palmer voluntarily sat down for two interviews with state investigators.

During both interviews, Palmer lied repeatedly to the Marshall’s office about her knowledge of the scheme, her role in the scheme, her relationship with James, and “virtually every other aspect of the state’s investigation,” Marshall’s office said.

Palmer even lied about speaking with James just two weeks prior, according to the attorney general.

Unbeknownst to Palmer, James was cooperating with state and federal authorities and agreed to record a phone call with Palmer. During that call, Palmer told James to not send text messages, to tell authorities that certain addresses for the fraudulent companies used to exist, that he didn’t see her when he got the bogus checks, and “to put [the crime] on the white boy,” referring to an innocent third party who worked in the accounts payable department of MPS.

Marshall said prosecutors will be seeking prison time for Palmer “because of the gravity of Palmer’s crimes, her repeated lies, her attempt to influence James, and her refusal to accept responsibility until the day of trial, when she would have finally had to face a jury that would have heard this evidence and more.”

Palmer’s attorney indicated they will seek a community corrections sentence for their client, which would spare Palmer jail time, according to Marshall.