FBI investigation nets 2 arrests in VCSC kickback scheme

ICN file photo

UPDATE - See relatedstory
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A Vigo County sheriff's Office deputy and a Vigo County School Corp. facilities director were arrested this morning after alleged involvement in a kickback scheme that involved personal profit in cash, gift cards and other perks of doing official business with the corporation.

FBI Special Agent Joann Dowell reports that investigation into the Vigo County School Corp. reveals Franklin V. Fennell and Deputy Frank Shahadey -- while working for the VCSC between April 2014 and Oct. 28.2016 -- "embezzled, stole, obtained by fraud" more than $5,000. 

Many  projects were lined up at several schools through the course of investigaiton where the two suspects received kickbacks, including projects involving fence installation, tree removal and retention pond construction. Several recorded conversations and meeings with a key witness took place over the course of several months. However,The FBI became aware of a more serious plan Oct. 4. The witness met in a recorded meeting with Shahadey, who performed routine duties in school security.

"During the meeting, Shahadey threatened to kill a VCSC employee for giving a journal, maintained by fennell, to VCSC Superintendent Danny Tanoos," court documents state. 

Special Agent Dowell believes, due to her investigative expertise, Shahadey was worried the scam with Fennell would end if Fennell was to be fired because of the pending investigation. As a result of the seriousness of the threat, the investigation and warrants were kept confidential until now.

Fennell was reportedly released today after his initial hearing. No future court date has been set at this time.
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Shahadey was detained by the US Marshal and has a detention hearing in Indianapolis Federal Court Friday, Nov 4, at 12: 30 p.m. Due to the arrests today, both have been terminated from their jobs with the VCSC.

​Look for related story soon.