Audit: Broward schools failed to recoup more than $300,000 from caps and gowns vendors
South Florida Sun Sentinel | By Scott Travis | January 28, 2024
The Broward School District has been unable to collect more than $300,000 that auditors say were overbilled by a former supplier of graduation caps and gowns, a new audit shows.
The district issued a demand letter dated Oct. 24, 2023, to Chuck Puleri and Associates, the district’s former vendor for Herff Jones graduation products, for $301,489 in October, according to a Jan. 5 letter from district administrator Joe Phillips to Chief Auditor Joris Jabouin.
The company overcharged the district for certain items, such as honor cords, stoles and diplomas between 2016 and 2021, according to audits from the Alabama accounting firm Carr, Riggs & Ingram. The district does not expect to get that money back, Phillips wrote.
“Our understanding is that the business is no longer in operation. Therefore, the recuperation of funds may not be likely,” he wrote.
The South Florida Sun Sentinel could not reach Chuck Puleri, owner of Chuck Puleri & Associates. His company still has an active registration with the Florida Division of Corporations, but last year he closed down his shop that sold class rings and graduation products.
Auditors say Puleri’s company also overbilled parents and students at least $331,181 by charging prices higher for caps and gowns than the company had bid on. That figure was based on one year in a five-year contract period.
Auditors say the actual amount is likely much greater because the company reported to auditors that it had shredded invoices for four other years in the contract.
Audit-Broward-findingss_PDF-1The district has not attempted to collect this money, as the district’s general counsel’s office has concluded the district has no legal standing in overpayments by students or parents, Phillips told the district’s Audit Committee on Thursday.
“The course of action would be for parents to take legal action on their own against the company,” Phillips said.
Some Audit Committee members questioned whether the district was trying to absolve itself of responsibility. They noted the only reason parents and students used Chuck Puleri & Associates was because the district instructed them to.
“It disappoints me that parents get caught in the mix and in the middle of something that shouldn’t happen,” Audit Committee Bob Mayersohn said.
The district started reviewing its cap and gown contracts following a series of South Florida Sun Sentinel investigations in 2021 that revealed that Puleri’s company had a near monopoly in the district, maintaining close relationships with district administration while charging inflated prices to students and parents.
The company had bid on a price of $44 but didn’t offer that price to parents who shopped on the company’s website, the Sun Sentinel uncovered.
broward-cap-and-gown-audit-follow-up.pdf-2Puleri also had close relationships with some school officials, inviting former administrator Shawn Cerra, who oversaw graduations, and School Board member Donna Korn to his beach house near Naples on multiple weekends. The State Ethics Commission cleared Cerra and Korn in 2022 after finding insufficient evidence the trips influenced any decisions the two made related to caps and gowns.
The school district overhauled the way it selects cap and gown vendors and set a cap on prices following the Sun Sentinel’s reporting.
In 2022, the district started contracting with the corporate offices of the vendors, rather than the local offices. So the district used Herff Jones’ corporate office rather than Puleri’s company, as well as competitor Jostens for the 2022 graduation season.
Herff Jones initially kept Puleri on as the local supplier, but later severed ties with him.
After the audit, the School Board dropped Herff Jones, leaving Jostens as the sole cap and gown vendor.
Auditors found there were still a few problems during the 2022 graduation season, with Herff Jones overbilling the district $16,326 and Jostens overbilling $5,364.
Jostens has reimbursed the district, and “the district is currently conducting ongoing discussions with Herff Jones leadership to come to a resolution” of the amount that company owes, Phillips wrote.
Although Herff Jones no longer has a cap and gown contract, the company is still an active yearbook vendor with the district. The yearbook company is a separate division of Herff Jones that was never affiliated with Puleri, and the School Board decided last year not to end that contract.
Still, audit committee member Peter Turso said the district should completely cut ties with the company, noting the company hadn’t repaid money the district says it’s owed.
“They shouldn’t be dealing with the district until they do, and the fact that they are, I’m sorry, it smells bad,” Turso said at the recent audit committee meeting.
