Feds seek to dismiss fraud case against ex-Lincoln-Way school chief

Federal prosecutors motioned to end their 2017 federal fraud case against the former leader of Lincoln-Way High School District 210 based on medical issues hindering his ability to defend himself.

The case against Lawrence Wyllie, 86, who retired as superintendent in 2013, has long been delayed by his unspecified medical issues since at least 2018, when his attorneys submitted records in federal court about his health condition.

Then, on Jan. 11, 2023, both parties in Wyllie’s case said for the first time that his “serious and ongoing” medical conditions prevents him from meaningfully participating in his own defense.

That eventually became the basis for the dismissal of a six-count indictment against Wyllie, according to a motion filed Friday from Assistant U.S. Attorney Jason Yonan.

“Based on a review of those materials, the government seeks dismissal of the indictment because [the] defendant’s various medical conditions are significant enough that the parties agree [the] defendant cannot meaningfully contribute to his defense in this matter,” according to Yonan’s motion.

Calls and messages to the U.S. Attorney’s Office in Chicago, Wyllie’s attorney Dan Webb and Lincoln-Way District 210 Superintendent Scott Tingley were not returned Friday.

Wyllie could have lost his pension if convicted of the charges against him. He continues to collect hundreds of thousands of dollars in annual pension payments since his retirement in the past decade.

Wyllie’s pension payment this year likely would amount to almost $400,000.

The indictment against Wyllie was filed Sept. 13, 2017. Federal prosecutors alleged that Wyllie:

• caused District 210 to assume $7 million in additional debt.

• misused $80,000 in district funds for his own personal benefit.

• concealed the true financial health of District 210.

• deceived the public about the use of money from a $225 million bond referendum.

• used $50,000 in district funds for his own dog obedience school called Super Dog Training School.

Many allegations concerning financial issues at District 210 – including Super Dog – were detailed in an unsuccessful 2015 lawsuit from 28 plaintiffs to block the closure of Lincoln-Way North High School in Frankfort.

Liz Sands, the lead plaintiff in the case, said that in 2017 the indictment was a vindication for the community and everyone who worked hard to uncover information alleged by prosecutors.

“Every single piece, from what we can see, is absolutely everything we uncovered and turned over to the FBI almost two years ago,” Sands said in 2017.

On Sept. 27, 2017, Wyllie appeared in person for his arraignment in Chicago, where he pleaded not guilty to charges of wire fraud and embezzlement. Wyllie was with Webb, who recently prosecuted the disorderly case against actor Jussie Smollett in 2021.

Wyllie was largely silent throughout the almost 10-minute arraignment. After the court hearing, Wyllie refused to respond to questions from the media about the charges or the financial crisis that afflicted District 210 for many years.

Financial fall

Between 1989 and 2013, Wyllie was the superintendent of District 210, which has three high schools in New Lenox and Frankfort. Wyllie was a highly esteemed school official whom former District 210 board President Ron Kokal called an “absolute genius in school financing.”

But District 210′s financial health began to publicly unravel in the few years after Wyllie’s retirement.

After district officials adamantly denied rumors of a school closure in spring 2015, the school board nevertheless voted 5-2 to shut down North later that summer. The closure was part of a plan to resolve the district’s dire financial issues.

The district had overbuilt with the construction of West and North high schools, which were financed by the $225 million bond referendum.

The schools were built to meet projected student growth in the late 2000s. But it was apparent to district officials well before the construction of North in 2008 that student enrollment projections were not matching reality.

The district’s financial crisis kicked off a firestorm of criticism at board meetings, protests, litigation, investigations by the FBI and the U.S. Securities and Exchange Commission, and a crowded election race for the school board in 2017.

Board members were quick to blame low state funding and a poor housing market. But they acknowledged about eight months after the decision to close North that the financial condition of the district was “masked by improper accounting.”

Board members also admitted that there wasn’t a “proper system of checks and balances” in place and Wyllie took “unauthorized action.”

In 2016, the board voted to dismiss teachers to save millions of dollars. Tim Conway, president of the Lincoln-Way Education Association at the time, said the teacher cuts were symbolic of the “mismanagement of public dollars.”

“It represents a way of conducting business that should have never been allowed. It represents students losing their teachers, it represents an increase in class size that will diminish the educational opportunities for students,” Conway said.

After Wyllie’s retirement, District 210 received the lowest financial rating by the Illinois State Board of Education for three years in a row. Moody’s Ratings also gave the district a junk bond rating in 2016.

Since then, the district’s financial rating has improved to the highest rating by ISBE, and it was given a high “A1″ rating by Moody’s last April.

For years, North school sat mostly empty after its closure in fall 2016. But the Super Dog school continued to operate there long afterward.

The building was used this past school year by students and staff from Lockport Township High School District 205 as repairs were made to Lockport’s Central Campus.