$6 million in fraud, multiple bribes paid at Houston school district

Multiple guilty verdicts have been handed down in a nine-year fraud case that cost Houston ISD – and its taxpayers – millions.

A federal jury convicted the Houston school district’s former COO Brian Busby and contractor Anthony Hutchison on charges of conspiracy, bribery, filing false tax returns and witness tampering. Hutchison was also convicted of seven counts of wire fraud, the U.S. Attorney’s office said in a release.

The corruption centered around Busby pressuring school officials to award projects to Hutchison’s companies in exchange for tens of thousands of dollars in bribes. Hutchison often overcharged the district, overbilling it for services and charging twice what he paid for supplies, plus an additional 20%.

“HISD is the largest school district in the state, and the people of Houston trusted that district officials would spend their tax dollars wisely and carefully,” said U.S. Attorney Nicholas J. Ganjei. “Instead, Busby and Hutchison defrauded the school district and the taxpayers of millions of dollars, doing so to line their own pockets.” 

Five other district officials pleaded guilty to conspiracy and admitted to taking bribes, including former School Board President Rhonda Skillern-Jones. They face up to five years in prison when sentencing is carried out on July 28. 

The four-week trial included testimony from over 50 witnesses on the 33 charged counts involving bribery, false invoicing schemes, witness tampering and tax violations. 

One school official testified he did not want to work with one of Hutchison’s companies because it was often more expensive, but Busby pressured him to bypass the rotation or bid process and award the work anyway. 

Hutchison’s mowing and landscaping company charged the district an additional $6 million over the years, said the District Attorney’s Office. 

Busby deposited nearly $3 million in cash into 18 bank accounts between 2015-2019, money he failed to report on his tax returns. He told the jury it was from other sources of income. 

Hutchison filed false tax returns in 2017 and 2018 and used various check-cashing schemes to try to disguise the bribes as legitimate expenses. Some of the money also paid for “extensive gambling debts,” the attorney’s release said. 

Both Busby and Hutchison pressured one of the witnesses to lie about how the contracts were awarded and to say a ledger with the bribe payments was for gambling. 

“For years, Busby and Hutchison defrauded the largest public school system in Texas out of millions of dollars – money that was intended to benefit the students of HISD,” said Special Agent in Charge Douglas Williams of the FBI Houston Field Office. “In turn, Busby and Hutchison also defrauded the taxpayers whose hard-earned dollars were fraudulently diverted for their greed and personal gain. Public corruption cases like this one are challenging to investigate and prove and erode the trust we place on our public servants.” 

None of those convicted by the jury still work for the school district. 

The convictions come as the Texas House approved the largest day-one school choice program in the nation, a $1 billion fund that could allow up to 100,000 to attend private school or the school of their choosing this fall.  

At sentencing, Busby and Hutchison face up to five years for conspiracy, 10 years for bribery and 20 years for witness tampering. Hutchison also faces up to 20 years for each count of wire fraud. All charges also carry a fine of up to $250,000. 

The district, which serves nearly 190,000 students, has been scandal-plagued for years but is in the middle of a turnaround following a state takeover in May of 2023. Still, less than half of students can read or do math proficiently, according to test data.