Doesn't the ODE do background checks any more? Where was Dr. Zelman?

Ex-con minister faces school-fraud charges

Cleveland Plain Dealer

Saturday, September 16, 2006

Damian G. Guevara

Plain Dealer Reporter

The Rev. Mark C. Olds found religion in prison and, once out, ascended to the pulpit, where he preached redemption and forgiveness.

But the preacher is in trouble with the law again and faces another stint in the penitentiary. Federal authorities accused him and two others Friday of defrauding the state's Department of Education of $2.2 million in connection with a defunct charter school that Olds founded and ran.

An indictment charges Olds, 56, of Solon, with conspiracy, money laundering and mail fraud. Also indicted are Shirley S. Haynes, 57, of Cleveland, the school's treasurer; and Timothy Daniels, 47, of Arizona, chairman of the school's board.

The charter school -- the Cleveland Academy of Math, Science and Technology -- was one of several projects that garnered media attention for Olds in the past decade. The native of North Carolina spent most of the 1980s in federal prison for bank robbery before arriving in Northeast Ohio to promote a message of forgiveness, especially for ex- convicts.

He conceived and spearheaded Cleveland's Amnesty Court, which led more than 13,000 people with outstanding misdemeanor warrants to turn themselves in and clear their cases last winter.

That led to a similar program for felony cases in August, which is being copied nationwide.

Olds opened the charter school in the fall of 2002, holding classes first at a church and then a building on East 71st Street.

The academy struggled as students were given outdated textbooks and at times went without heat or food for lunch. When the school shut its doors for good in December 2003, it owed the state $1.4 million and had failed to pay teachers.

Prosecutors said that while workers and students were left in limbo, the trio pocketed $2.2 million, using the money to pay credit card bills and buy furniture, computers and even an aquarium for Olds.

The private academy received public money based on attendance. The scam, according to the indictment, involved submitting monthly reports with bloated student enrollment numbers. The school reported as many as 681 students when the actual number never exceeded more than 100, according to the indictment. The Department of Education gave the school $2.9 million, based on the inflated numbers.

The trio then set up overpriced contracts between the school and their own companies for services such as transportation and janitorial work. They never provided the services, which served as shells through which the group embezzled money, according to the indictment.

Olds was arrested Friday, and he entered a not guilty plea before U.S. District Judge Patricia A. Gaughan in Cleveland. The gray-haired preacher appeared solemn as a guard cuffed him and escorted him out of the courtroom.

Haynes entered a not guilty plea later in the day. Gaughan scheduled a detention hearing for both on Sept. 20. Both will remain in custody until then and could not be reached to comment.

Daniels appeared before a judge Friday in U.S. District Court of Arizona in Phoenix. He was released without bail. Next week Daniels will be arraigned. He can not travel to Ohio or acquire a passport, court officials said.

Olds has served at the Eagle Rock Covenant Assembly in Cleveland and Olivet Institutional Baptist Church. He also founded The National Restoration Movement, an amnesty program designed to get guns off the streets, help convicts get the record of their crimes expunged and rebuild communities.

Phone messages left at Olds' listed phone number and at Eagle Rock were not returned.

In 2000, Olds published an autobiography, "Not Without Scars," about his 16 years in prison and the rebuilding of his life. He has used the story of his incarcerations - for selling and using drugs and as well as bank robbery - to motivate others to live right.

The book was published by MCO Media Group, one of the companies that authorities say benefited from the scam.

To reach this Plain Dealer reporter: dguevara@plaind.com, 216-999-4334