November 2, 2016

FBI Probe Leads To Theft, Bribery Charges In Vigo County

Article origination WFIU-FM
Crime scene tape surrounded the parking lot as the FBI raided the Vigo County School Corporation offices in Terre Haute in June. - Harrison Wagner/WFIU-WTIU

Crime scene tape surrounded the parking lot as the FBI raided the Vigo County School Corporation offices in Terre Haute in June.

Harrison Wagner/WFIU-WTIU

Two Vigo County School Corporation employees have been terminated and are charged with theft for allegedly stealing thousands of dollars from the school district.

Early Wednesday morning, FBI agents arrested Special Deputy Franklin Fennell, who is also the school corporation transportation director, and Sergeant Frank Shahadey, also the School Resource Officer.

The two appeared Wednesday afternoon in federal court in Indianapolis.

According to FBI investigators, Fennell and Shahadey took thousands of dollars from the school district.

The scheme began in early 2014 and continued until October 2016.

According to court documents, Fennell contracted an unnamed business to perform several tree and stump removals, then worked with Shahadey and an employee of that business (referred to as “Individual A”) to inflate the invoices. Once the school district paid the bill, Individual A split the excess with Fennell and Shahadey. Most kickback payments were $500, but some were larger.

In February, Individual A went to police with the information and worked with the FBI to collect proof.

Timeline of Events

January 2014
Business A begins working for VCSC.

April 2014
Fennell directs Individual A to begin inflating invoices so that kickbacks would be made to Fennell and Shahadey.

June 8, 2016
Federal agents execute search warrants at VCSC locations.

June 15, 2016
Business A received $33,700 check for work completed at Hoosier Prairie prior to June 8, 2016 search warrant.

July 15, 2016
Individual A meets with Shahadey at agent’s direction and tenders $6,000 in kickback payments arising from work completed at Hoosier Prairie, and agreement between Individual A, Fennell, and Shahadey to inflate the cost of the work and split the overage.

July 20 – October 28
Fennell hires Business A for two separate jobs to remove trees and stumps at Ouabache Elementary School.

Shahadey directs Business A to inflate the cost and split the coverage 50/50.

October 27, 2016
VCSC funds the jobs, and Individual A receives a VCSC check in the amount of $3,100 as payment. Individual A deposits the check at agent’s direction, and pays Shahadey and Fennell (through Shahadey) $500 each in kickback payments.

October 28, 2016
Individual A pays Fennell a $200 kickback payment in the form of a gift card as instructed by Shahadey.


Investigators believe Shahadey is a threat and should not be released, based on threats Shahadey made during recorded conversations. Shahadey will challenge that in court on Friday.

From the court documents:

“I believe that during this [October 4, 2016] recorded conversation SHAHADEY referenced FENNELL’S continued concerns that the VCSC Superintendent (“Danny)” was going to fire FENNELL because FENNELL had information relevant to the pending federal investigation. According to SHAHADEY, if the Superintendent fired FENNELL, the three could not continue their kickback scheme. SHAHADEY threatened to harm the person who provided purported evidence of FENNELL’S cooperation to the Superintendent.”

Here is an excerpt of that meeting, provided in court documents:

Shahadey: [Another employee] found Frank’s (FENNELL’S) book at Sarah Scott, laid down, he went through it, read it and took it to Danny.
Ind. A: Uh.
Shahadey: So guess what? I want him killed, I think I’m about to do it.
Ind. A: You’re out of your mind.
Shahadey: Oh no, listen to me, he’s crossed the line. Crossed the line.

Fennell was released Wednesday prior to a pre-trial hearing. Shahadey will remain in custody until at least Friday.

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