According to an indictment on Tuesday, February 4, 2025, Mr. Eric Rego allegedly committed fraud by using Mt. Diablo Unified School District (MDUSD) funds intended for an after-school program to purchase tablet computers and other electronic devices and selling the devices for profit.
The school district had an after-school program that offered students, recreational, academic, and environmental programming. The program was funded primarily through state grants and Mr. Rego was the after-school program coordinator.
MDUSD’s after-school program was run by a nonprofit company with which Mr. Rego worked closely as the coordinator. Mr. Rego allegedly told an employee of this company that the electronic devices were for the students. In addition, an employee was allegedly instructed to submit monthly invoices containing a line-item expense for subcontracts and supplies and to include the cost of the iPads and other devices in this line-item.
Rego reviewed and approved these monthly invoices before submission to the school district. Mr. Rego would then allegedly keep the devices and sell them. There was a failure of internal controls that allowed Mr. Rego to use his position to steal the electronics and conceal up the scheme by altering invoices.
Segregation of duties and not allowing for Mr. Rego to have the ability to influence employees of the nonprofit company could have prevented the scheme. In the future, this will likely serve as a lesson learned for the school district in where they can improve processes and mitigate future fraud.
Photo by Abdullah Minhas
