Two Central Valley school officials pleaded guilty Thursday in a scheme that officials say bilked the Patterson Joint Unified School District out of more than $1 million that was used to remodel homes and purchase cryptocurrency, computers and vehicles, including a Ferrari sports car.
Jeffrey Menge, the former assistant superintendent at the Stanislaus County district, and Eric Drabert, the former information technology director, pleaded guilty in Sacramento federal court to theft concerning programs receiving federal funds, crimes that could result in prison sentences of up to 10 years and $250,000 in fines.
The pleas before U.S. District Judge Troy L. Nunley follow FBI raids last May of Menge’s Copperopolis home and Drabert’s home in Patterson that resulted in the seizure of cash, electronics and computer equipment, according to The Modesto Bee.
Court documents say the case involved Menge embezzling between $1 million and $1.5 million from 2019 until 2022 using a phony company he created and a fictitious executive from the “company.”
The scheme included setting up a website for the company, Cencal Tech LLC, and a fake LinkedIn page and email account for a Cencal executive Menge named “Frank Barnes,” court documents say.
Menge also hired Drabert as the IT director to help with the plot, court documents say.
“Over the course of the next approximately two years, Menge and Drabert then conducted over $1.2 million in interested party transactions with the School District through Cencal Tech,” court records say. “Many of the roughly $1.2 million in transactions were fraudulent and involved Menge and Drabert intentionally and fraudulently double billing, over billing, and billing for items not delivered by Cencal Tech to the School District.”
Menge also used his district credit card for his personal use, court records say.
“Between 2018-2022 Menge used his School District Credit card as his own personal credit card and purchased furniture, watches, hunting equipment, automotive parts and tools and electronics,” court records say.
The pair also used school money to buy high-end laptop computers and graphics cards “to operate a cryptocurrency mining farm,” court records say, and then transferred the proceeds “to wallets under their own personal control.”
Menge also had an apparent affinity for vehicles, according to court records, which say that in 2020 he sold a two-year-old Chevy truck the school district had purchased for $50,000 to himself for $12,300.
A year later, he sold the truck, which had 12,000 miles on it, to a dealer for $39,300, “pocketing a $27,000 profit,” court records say.
Menge also took control of a school district van officials had planned to loan to Modesto Junior College and kept control of it for five years until 2023, “when the van was anonymously left at a school district site with the keys in an envelope on the front seat,” court records say.
“Google Earth images from 2018 to 2022 revealed the van parked at Menge’s residence,” court records say. “A social media picture posted online showed Menge sitting with his family at an outdoor table (also improperly purchased with School District funds) at their home with the van parked behind them.”
Menge’s other expenses included paying to build a shop on his property, remodel his home and purchase expensive vehicles, including the Ferrari, court records say.
A plea agreement says Menge must forfeit dozens of items to the government, including tools, computers, an Audi R8 Quattro, Jeep Wrangler Hellcat and the 2010 Ferrari 458 Italia.
Drabert is accused in court records of using some of the district funds to remodel a cabin in Calaveras County and helping deliver proceeds from the scam to Menge, court records say.
“Drabert personally picked up some of the Cencal Tech checks from the finance department, and told others that he would deliver the checks to the ‘owner’ of Cencal Tech,” court records say. “Drabert personally received at least $200,000 in transfers from the Cencal Tech Bank of America bank account.”
“In total, Drabert stole between $250,000.00-$300,000.00 from the School District,” court records say.
The two men are scheduled to face sentencing May 30.