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Federal agents arrest Vigo Schools employee & school resource officer accused of theft

Posted at 5:10 PM, Nov 02, 2016

TERRE HAUTE, Ind. -- A Vigo County School Corporation employee and a sheriff's deputy assigned as a school resource officer were charged Tuesday with theft for allegedly taking kickbacks from vendors.

Frank Fennell, VCSC's facilities director, and Frank Shahadey, a Vigo County Sheriff's deputy assigned to VCSC, were each charged with one count of theft in U.S. District Court.

According to court documents released Wednesday, federal agents interviewed a business owner who told them he had been inflating invoices to VCSC and providing kickbacks to Fennell and Shahadey since early 2014.

The business owner, who isn't named in the documents, told agents he performed approximately 58 jobs for VSCS between January 2014 and June 2016. He said he never paid Fennell or Shahadey more than $500 each at a time.

He also said there were times when no work was completed that he nevertheless submitted fake invoices.

Records show VSCS paid the business more than $440,000 between January 2014 to June 2016. The business owner reportedly said only $37,520 of that comprised payments in which no kickback was made.

Investigators also recorded a meeting between the business owner and Shahadey in which he allegedly accepted a $6,000 kickback, to be split with Fennell.

The charges appear to be connected to an FBI investigation at the VSCS in June.

MORE | FBI investigation Vigo Co. School Corporation

Fennell was released to his own recognizance Wednesday following an initial hearing. No court date has yet been set.

Shahadey was detained by the U.S. Marshal's Service and has a detention hearing scheduled Friday at 12:30 p.m. in Indianapolis.