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DOE Sources Silent About Fiscal Misconduct Warnings for Six Years

According to DCI, Stephanie Hubers knew something was wrong in Scott and Nicole Westerhuis’s budget fudgery at Mid-Central Educational Cooperative before the Department of Education noticed “incompetence” in Mid-Central bookkeeping in 2012. Apparently, reports Angela Kennecke, so did multiple people in the Department of Education:

Sources who have first-hand knowledge within the Department of Education tell KELOLAND News there were questionable expenses involving GEAR UP grant money as early as 2006 that were brought to the attention of department officials.

Several sources have confirmed that the department was warned of the misuse of grant money again in 2010 and 2011 by then-directors of Indian Education, LuAnn Werdel, followed by Roger Campbell.

KELOLAND News spoke with Roger Campbell Wednesday. He told Angela Kennecke he left the Department of Indian Education by his own accord, and could not help regarding issues with the GEAR UP grant during his time in office.

When KELOLAND News reached LuAnn Werdel, she said she did not want to comment.

In a statement Wednesday, the governor’s office did not dispute those warnings, but said they cannot comment on personnel actions [Angela Kennecke, “Warnings of Troubles With GEAR UP Grant To DOE Earlier Than First Reported,” KELO-TV, 2016.03.23].

One could read this report as pretty thin. The two individuals named, both former directors of the Office of Indian Education, decline to substantiate whatever “several” unnamed sources are telling Kennecke. We don’t know if “first-hand knowledge” is simply stuff folks heard or documents that landed in their laps that they can share with the press and the police. We don’t know if “several” means two or ten.

But I don’t think Angela Kennecke leaks tea leaves stamped “Sources in Pierre” unless she knows there’s strong tea coming. Since we have these tea leaves, let’s stick our pinkies out and see what they say:

  1. Kennecke says the sources are “within the Department of Education.” Leaks don’t happen much in Pierre. If sources in Pierre are talking, they may know the next shoes are about to drop, and they want to get out in front of that drop so they don’t get squashed along with the main targets.
  2. Leaks from the Department of Education may also indicate that someone higher up has authorized the leaks. Someone higher up may have told those sources that whatever fear or orders or loyalties have kept them silent for six years are about to be superseded.
  3. Speaking of that six-year silence, even if we don’t know their names, apparently several people had signals of “misuse”—not “incompetence,” but “misuse”—for a mighty long time and, apparently, did little or nothing to stop it. These sources may have committed no active fraud, they may not have received any hush money from Scott Westerhuis, but even if unbought, their long silences lay on their shoulders some portion of responsibility for the diversion of funds and whatever other crimes happened at Mid-Central.

“Several” sources cognizant of misuse of funds but silent for six years or more would represent pervasive corruption that no happy spin or the replacement of one department official will cure. These unknown DOE sources may be guilty staffers who know the crapstorm cometh and can only unburden their consciences on their way out the door.

Now, let’s see which one of them is first to reveal the real evidence.


  1. Meyerink 2016-03-24

    If they were unbought and still remained silent, there is still a family gone and one would wonder if this would have still happened if the silent ones would have came forward. It’s not all about money and fraud, I do agree that many are involved and I hope the guilty partys are charged with their crimes but at the same time when all this is brought to light we will always be reminded of the family that might have been saved….

  2. BOHICA 2016-03-24

    In a statement Wednesday, the governor’s office did not dispute those warnings, but said they cannot comment on personnel actions …. ummm….what type of personnel actions? Upcoming…or past? Could the citizens of SD get lucky enough to get a new Secretary of Education?

    Actually their style is to let the heat subside (as if it will) and then let her resign for other opportunities. Then comes the accolades from her staunch supporter the head guber…and we never hear any more about her…officially.

  3. Dana P 2016-03-24

    Corruption breeds more corruption. If you remain silent, you are giving tacit approval to the “wrong doing”.

    As some in law enforcement subscribe to the “thin blue line” theory, maybe we should start calling SD corruption:

    TTPL = The Thin Pierre Line

  4. Roger Elgersma 2016-03-24

    When there is a gag law in place it is easy to just keep your mouth shut. But when there are felony charges being dropped, it starts to look like talking first as if you did nothing but that you did notice something becomes easier or even necessary to cover ones own butt. So then the gov says that those that talk are talking about individual actions, as if it might be their actions or insinuating that it was not the whole department, may be misleading or even trying to threaten those who talk as if it is their actions that are bad.
    When there is this much money being taken it becomes more likely that there are more people involved since there is enough money to go around.
    This whole company culture that we conservatives do no wrong has led to a coverup mentality that is a breeding ground for corruption, since nothing gets caught in a reasonable amount of time. State employees have noticed for a long time that you can get by with crap and everyone looks the other way. Then Michelson tries to defend his weak corruption laws by saying that we do not want to spread felonies around to his colleages and only get the money back and a little slap on the wrist. This proves to employees of the state that if you gamble on doing fraud you will not get a very severe penalty but sure could get rich on a scheme to defraud. Not a good scenario.

  5. Rorschach 2016-03-24

    Here’s the thing. There are no legal protections for these inside “sources.” South Dakota does not have a whistleblower law to protect them because the Republican party that has complete control of government does not want anybody to be a whistleblower. Rep. Peggy Gibson (D-Huron) brought a bill for whistleblower protection in the interest of clean government, but the GOP party would not let the bill pass. Imagine all the shenanigans we would find out about if people in government were free to blow the whistle on corruption and incompetence without fear of losing their jobs and being prosecuted.

    I see on the press release blog that Marty Jackley is interested in working with both parties on strengthening conflict of interest laws. When he supports a whistleblower law we’ll know he’s serious about that. Otherwise he’s just issuing empty press releases.

  6. Rod Hall 2016-03-24

    Rod Hall agrees with Meyerink that that family did not have to die. Were all those “so called educators” blind, deaf and dumb? If you are smart enough to be paid as an educator you need to open your eyes and report things that are not right. Had anyone gone to Angela with real factual material four more students might enjoy this Easter season. Shame on all you adults for not knowing what was going on!

  7. Rorschach 2016-03-24

    I don’t believe that Jackley will support a whistleblower law because he will find himself on the wrong side of whistleblowers. The recent leak of a DCI report detailing rampant corruption in the Flandreau Police Department some time back indicates that Jackley swept the whole thing under the rug. DCI works for him, and he decides what to prosecute and what to tell the press. With a crooked police force he chose to bottle up the investigation and not tell anybody. Were it not for some brave anonymous whistleblower we would never have learned about the extent of corruption in Flandreau or Jackley’s coverup. So instead of prosecuting crooked cops he’s probably looking for the leaker of the DCI report (whistleblower) to prosecute. This is why we need an honest prosecutor who will follow the facts wherever they lead rather than acting as the cover upper in chief for the GOP party.

  8. Darin Larson 2016-03-24

    Ror- I would like to know who voted against Peggy Gibson’s whistleblower bill. The politicians that voted against her bill need to be held accountable, especially in the aftermath of all these corruption scandals that demonstrate the need for it. If you have any information in terms of legislative year, I would be happy to try to look it up.

  9. MOSES 2016-03-24

    Where is the Secretary of Education on this.

  10. grudznick 2016-03-24

    Mr. Larson, I think you can look that up yourself. They put it on the internets right after the vote and there it stays mostly forever.

    Mr. Moses, what I am wondering is are the deep throats making anonymous phone calls to the media and throwing their co-workers under the train wheels? You will probably see a domino effect of more and more of these “sources” starting to spill the beans and pretty soon names of people in the Education Department who failed to do the things that needed to be done will be blared across the sky. Mr. Mercer might get a Bob Woodward award.

  11. Roger Cornelius 2016-03-24

    With all that dirty money floating around Pierre and not going for what it was meant, you really have to ask yourself why Dennis Daugaard is afraid to fire Melody Schoop$$$$$

  12. caheidelberger Post author | 2016-03-24

    Bohica, I’m speculating, but “personnel actions” could refer to whatever decisions spun the merry-go-round of Indian Education directors. The two directors mentioned in Kennecke’s report, Werdel and Campbell, didn’t hold that post very long. Maybe the warnings came up in personnel reviews. Maybe the warnings had something to do with why the higher-ups didn’t want the warners sticking around in the office.

  13. caheidelberger Post author | 2016-03-24

    Roger C, that’s a good question. Why keep Schopp? What does she have to offer? Why not cut the head off now, before the scandal gets bigger?

    Curious: can anyone think of comparable scandals, here or in other states, that led to an earlier dismissal of a department chief by the Governor?

  14. Roger Cornelius 2016-03-24

    If you go back to Nixon era, you’ll recall that Nixon would not fire Halderman, Erchilman, and Dean until he absolutely had no choice.
    Once he fired all three, the wheels really came off the wagon.

  15. mike from iowa 2016-03-24

    Roger C-I believe you are getting into the Judge Bork “Saturday Night Massacre” that endeared him to Libs at his Scotus hearing later in life.

  16. leslie 2016-03-24

    Thin too is using “personnel” to hide, cover-up, and keep people in the dark, again before an election. Daugaard must join Jackley standing up in front of the public and answering every question arising. No dodging. Then a full press conference. Soon. Come on Platte, demand answers and action. Why no whidtle blower law this session. Truly no credibility here.

  17. grudznick 2016-03-24

    They should parade these whistleblowers out across a stage during a press conference. No doubt that would really get more to come forward.

    No, no indeed, Ms. leslie. They need to get the names of the people who failed and terminate them loudly and not shoot the tattletales in public.

  18. Richard Schriever 2016-03-24

    Cory, have you ever tried to report “misuses”, or abuse of power, or a statutory violation by a governmental official to the AG’s office, or to a state’s attorney’s office? Unless they are directed by clear statutory to investigate a charge/claim (open meetings violation for ex:) the typical response is “you need to contact a private attorney.” I.E., the cost of justice is on you, not the state.

  19. mike from iowa 2016-03-25

    Got to admit,Westerhuis blew the lid off this scandal (no pun intended) and I still must wonder what would be going on now if he hadn’t spectacularly drawn attention to it? Would there have been an investigation without the murder/suicide/arson?

  20. caheidelberger Post author | 2016-03-25

    Richard, that’s crazy, There ought to be some mechanism by which we get the state to check its abuses. Ah, that must be what IM 22—the Anti-Corruption Act and its state ethics commission—is for!

    Mike, if this story didn’t have the murder-suicide angle, it would generate at best a third of the traffic I see on my site stats now. Ditto for EB-5 without Richard Benda’s death.

  21. grudznick 2016-03-25

    I just bet you an extra sausage with your bacon tomorrow that there are some low level grunts in the Education Department who are singing right now.

  22. caheidelberger Post author | 2016-03-25

    I think you’d win that bet. Call me overly hopeful, but that cautious leak sounds like a signal.

Comments are closed.