Former Lincoln-Way D-210 superintendent pleads not guilty to federal fraud charges

CHICAGO – A former Lincoln-Way District 210 superintendent pleaded not guilty to federal charges of fraud and embezzlement.

Lawrence Wyllie, 79, of Naperville, appeared in person with his attorneys at his arraignment Wednesday before U.S. District Judge Gary Feinerman in Chicago.

Wyllie largely was silent throughout the almost 10-minute arraignment. Afterward, he didn’t acknowledge questions from the media about the charges against him or the fallout of the school district he led for about 24 years before retiring in 2013.

While walking away from the courtroom, Wyllie’s attorney, Dan K. Webb of Winston & Strawn law firm, spoke on his behalf and said he and the rest of Wyllie’s defense team plan to go to trial over the charges.

In an email, Webb said they are convinced Wyllie is not guilty of the charges in the indictment.

“As a result, we will be going to trial and we expect that a jury will find Mr. Wyllie not guilty of these charges. We will not be making any further statements until the case goes to trial,” Webb said.

The next court date for Wyllie’s case is at 9:45 a.m. on Dec. 11.

When Wyllie appeared in court, he sat with his attorneys with his back to an audience of about 10 residents of the New Lenox-based district who came to watch his arraignment.

Marisa Barnas, one of the residents who attended, said that there needs to be more oversight of school boards. She said that parents need to be vigilant with school districts, and she hopes state lawmakers take note of what happened with District 210.

“The community will have its day in court. The community is being heard,” Barnas said.

Wyllie was superintendent of District 210 from 1989 to 2013. He led the district through immense growth as it grew to four high schools.

However, the district was put on the state’s financial watch list in 2015, and the board voted the same year to close one of its newest schools, Lincoln-Way North High School, to cut costs.

The decision stirred community outrage and led to an unsuccessful lawsuit by citizens group Lincoln-Way Area Taxpayers Unite Inc. to block North’s closing. Wyllie has not spoken publicly on the district’s fallout.

Wyllie has been highly respected in the community, and was once called an “absolute genius in school financing” by former Board President Ron Kokal.

However, federal prosecutors allege Wyllie caused the district to assume $7 million in additional debt and misused at least $80,000 in district funds for his own personal benefit.

Wyllie misappropriated bond proceeds from a $225 million referendum that were used to construct North and West high schools in the late 2000s, as well as renovate Central and East schools, prosecutors alleged.

He also allegedly reclassified millions of dollars in district general operating expenses as purported bond expenses in the district’s general ledger and transferred millions of dollars from a U.S. Bank account to an Old Second Bank account the district used to pay general operating expenses.

“In this manner, [Wyllie] concealed the scheme and the true financial health of Lincoln-Way from the school board and the public by fraudulently appearing to lower the district’s net operating expenditures in its audited financial statements and its reported cost-per-pupil calculation,” prosecutors allege in the indictment.

Wyllie also allegedly used $50,000 in district funds, including bond funds, to build and operate Superdog – a dog obedience school at North high school – allegedly misappropriated $16,500 of district funds as a retirement stipend and allegedly misappropriated $14,000 of funds for unused vacation days.

He faces five counts of wire fraud and one count of embezzlement. Each count of wire fraud is punishable by up to 20 years in prison if he is convicted, while embezzlement carries a maximum sentence of 10 years if he is convicted.

Wyllie has a government pension of more than $321,000 a year. Dave Urbanek, spokesman for the Teachers’ Retirement System of the State of Illinois, has said that based on what TRS understands from the indictment, Wyllie could lose the pension if convicted, according to state law.