Former Chicago State University employee, her mother charged in ‘ghost payroll’ scam

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CHICAGO — A former Chicago State University administrative employee has been indicted for engaging in a financial crimes scheme in which she hired her mother in an ongoing “ghost payroll” scam and steered an unauthorized university consulting contract to a family friend, according to the Office of Cook County State’s Attorney Anita Alvarez.

Lashondra Peebles, 43, of Chicago, is charged with several of felonies, including six counts of Theft by Deception/School, five counts of Official Misconduct, two counts of Wire Fraud and four counts of Computer Fraud.

Peebles’ mother, Shirley Kyle, 65, has also been charged in the case and faces two felony counts of Theft by Deception/School for accepting payment for work that was never performed.

Peebles was terminated from her position at Chicago State in June of 2014 after an internal investigation at the university uncovered financial misappropriations which were reported to the State’s Attorney’s Office for criminal investigation.

According to prosecutors, Peebles was working as Director of Compliance and Interim Vice President for Enrollment Management at Chicago State in March of 2014 when she arranged for her mother to be hired as an employee.

According to prosecutors, Peebles created and posted an available part-time position on the university’s website but after receiving more than 3,000 applications for the position, Peebles hired her mother, Shirley Kyle, to fill the opening.

On March 3, 2014, Kyle filled out hiring paperwork at Chicago State and from the time of her hiring through May 30, 2014, Kyle was never seen on campus and failed to report to her assigned department. Peebles also failed to inform any of her co-workers that Kyle was her mother.

Despite never showing up for work or producing any recognizable work product, Kyle received six checks totaling $4,450 in gross pay.

During this same time period, Peebles also made a request to a university superior to enlist the consulting services of a company called PMO501. The request was officially denied by Peebles’ superior on the grounds that Chicago State did not require the contractual services.

Despite being specifically instructed not to enter into a contract with PMO501, prosecutors say that on April 21, 2014, Peebles used a Chicago State credit card which she did not have authority to use to pay PMO501 a total of $4,748. According to the university’s policy, any payment of over $3,000 requires authorized approval, so Peebles issued two payments in the amount of $2,700 and $2,048 in order to circumvent the system.

Investigators later determined that the company was owned by a family friend of Peebles. In addition to using the university credit card for fraudulent purposes, Peebles is alleged to have manipulated computer software at several levels in order to obtain approval of the PMO501 contract, including appearing on campus after taking medical leave from the university to approve the contract through the Legal Department, which she had no authority to do.

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