Feds accuse former Houston ISD chief of taking kickbacks from contractor

The February raid on Houston ISD headquarters and the home of the district’s then-chief operating officer stemmed from allegations that the high-ranking administrator engaged in a kickback scheme with a district contractor, newly filed court records show.

In a civil forfeiture complaint filed by an assistant U.S. attorney Thursday, federal investigators allege former chief operating officer Brian Busby conspired to pay an unnamed contractor for work performed by district employees in exchange for kickbacks. Federal agents seized $90,150 in cash from Busby’s home in February, as well as $95,874 in cash from the home and vehicle of the contractor, according to the filing.

Busby has not been charged with a crime, though federal officials wrote in the filing that the seized money is traceable to “the proceeds of federal programs theft and wire fraud.”

Busby did not respond Monday to a voicemail or message sent via Twitter. Court records do not list a lawyer representing Busby.

HISD officials said Busby, who was earning a $221,000 annual salary, no longer is employed by the district after he was not offered a contract renewal. His last day of employment was Aug. 31. Busby had been on paid leave following the February raid.

In a statement, HISD officials said the district is cooperating with an ongoing federal investigation, declining any further comment. Officials did not address whether the district continues to do business with the unnamed contractor.

The forfeiture complaint offers the first details of why FBI, IRS and U.S. Department of Education officials descended on HISD’s headquarters and Busby’s Cypress home in the early morning hours of Feb. 27. Federal agents were seeing carrying multiple boxes and containers out of the district headquarters as part of what they described as a “court-authorized law enforcement activity.”

Federal officials had not commented on the reason for the raid or filed any court records outlining the nature of their investigation.

In the Thursday filing, federal officials said the contractor owns a lawn and landscaping business that has performed work in the district. The owner received a multimillion-dollar contract in 2016 for grounds maintenance, landscaping, irrigation, and tree pruning and removal, according to investigators.

Federal officials said “there is reason to believe” Busby, the contractor and unnamed other individuals conspired to get HISD to pay the contractor’s business “for work that it did not perform.”

“At times, HISD employees performed a portion of the contracted work, often at overtime rates,” Assistant U.S. Attorney Kristine Rollinson wrote.

Rollinson added that the contractor wrote checks from his business account to other people, including subcontractors, who would cash the checks and return the money to the contractor.

Federal officials also said Busby would meet with the contractor or the contractor’s representative, and subsequently make “multiple cash deposits into various bank accounts he controlled.”

The six-page filing does not offer extensive details of the allegations or name any individuals, though it refers to HISD’s chief operating officer as of the date of the raid.

The allegations represent another blemish for HISD, which has endured multiple cases of self-inflicted tumult in the past few years.

State officials are trying to oust the district’s school board due to chronically low accountability scores at Wheatley High School and multiple findings of misconduct involving current and former trustees.

In addition, Texas Education Agency officials have spent the past 11 months investigating the district’s special education practices.

HISD also remains without a permanent superintendent nearly 2 1/2 years after Richard Carranza’s unexpected departure.

Busby spent more than 20 years working for HISD, rising from a custodian to the district’s second-highest paid employees. As chief operating officer, he oversaw several departments that combine to employ about 7,000 people, including business operations, maintenance, procurement and transportation.

Busby’s wife, Courtney, works for HISD as a school support officer. Her employment status did not change following the raid and the civil forfeiture claim does not reference her.

HISD Interim Superintendent Grenita Lathan has appointed an interim chief operating officer, Eugene Salazar, and the district posted an advertisement for the permanent position in mid-August.

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