Feds Charge Texas School Board Member in 7-Year Bribery, Kickback Scheme

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Photo: KSAT Screenshot

Federal agents escorted a handcuffed Texas school board member into court to face a judge over her purported seven-year involvement in a bribery and kickback scheme. She allegedly accepted gifts in exchange for her vote to try to secure health insurance contracts for school district employees.

On Thursday morning, FBI officials arrested San Antonio Independent School District trustee Olga Hernandez, 66. The board member stands accused of taking cash, jewelry, and travel bribes, US Attorney Richard L. Durbin announced, saying the ruse deprived taxpayers of honest services.

In the afternoon, a federal grand jury unsealed an indictment that alleged from March 2008 to May 2015, Hernandez conspired with Samuel Mullen, Chief Financial Officer of the Mullen Pension & Benefits Group, LLC; Joshua Cerna, Vice President of Strategic Markets for the Mullen Group; and, William Haff, a paid independent insurance consultant, to defraud San Antonio ISD and taxpayers by securing health insurance service contracts for school district employees through corrupt practices. Last year, the three co-conspirators pleaded guilty to their roles in the health benefit plan scandal.

The grand jury accused Hernandez of accepting bribes in the form of cash, jewelry, and travel from co-conspirators in exchange for her influence on the San Antonio ISD board of trustees and for her vote on numerous insurance services contracts awarded to companies with whom the Mullen Group had a financial interest. Officials did not disclose the total cash equivalent of the gifted valuables or the amount of money involved in the bribes or kickbacks.

US Magistrate Judge Henry Bemporad released her on a $25,000 unsecured bond. She had to agree to turn in her passport. The judge told her not to leave the United States. If convicted, she could face up to 20 years in federal prison for one count of conspiracy to commit honest services wire fraud. She denied any wrongdoing.

Following the court hearing, Hernandez’s attorney Alan Brown told reporters: “She’s been very good on the school board. She’s done a lot of good in this community and she’s innocent of this charge.” Brown added: “I think as everything unravels, everyone will see that.”

On the San Antonio ISD website, school board president Patti Radle called the arrest “alarming to our board and certainly saddens our spirit.” She also stated that she and other board members “know nothing about this case other than what we have read in the media.”

The school district’s Superintendent Pedro Martinez said: “We are very saddened and disturbed by this news. Since I have been here working with the Board, they have demonstrated a commitment to act with the upmost [sic] integrity, to focus on our students and build trust with the community. We are waiting to find out more information, and will be following it closely.”

According to San Antonio ISD, Hernandez was first elected to the school board in 2006 and her current term expires in 2019. She is a lifelong San Antonio school district resident and also retired from the school district. Hernandez, her husband, and two daughters graduated from San Antonio ISD. She holds an honorary life membership from the Texas Congress of Parents and Teachers Association, part of the PTA family.

Bemporad set Hernandez’s arraignment for March 2.

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