At Risk

The Pennsylvania Supreme Court has accepted an attorney’s consent to disbarment.

Respondent’s criminal conviction was affirmed by the United States Court of Appeals for the Third Circuit

Lawyer and businessman David Shulick owned a for-profit education company through which he contracted with the School District of Philadelphia to run its Southwest School, an institution designed to help some of Philadelphia’s most at risk children. Under the contract, Shulick received over $2 million to provide teachers, counselors, security, and special services to the charter school’s students. But instead of spending the money on the students as the contract required, he embezzled funds for his personal benefit and the benefit of his co-conspirator, Chaka Fattah, Jr. After a complex, multiyear fraud investigation, Shulick was ultimately charged and convicted. He now appeals, alleging a number of errors, ranging from speedy trial right violations to errors in evidentiary rulings, faulty jury instructions, and sentencing miscalculations. After careful review of each claim, we conclude there was no reversible error in the proceedings and will therefore affirm.

Particulars

Despite the contract’s clear requirements, Shulick failed to provide the services and staff he agreed to. He failed to employ the dedicated security personnel the contract required. He hired fewer teachers, provided those whom he did hire with far fewer benefits than the budget allocated, and paid his educators salaries of only $36,000 a year—$9,000 less than promised. Shulick then reduced their salaries even further if they elected health insurance. He even attempted to lay off teachers at the end of the school year to avoid paying them the final few months of their salaries. Overall, Shulick represented to the School District that he would spend $850,000 on salary and benefits each year but spent under half of that: about $396,000 in 2010-11 and about $356,000 in 2011-12. In all, of the over $2 million in funds he received, he spent only $1,186,001 on expenditures designated for Southwest.

Shulick’s failure to spend these funds on Southwest was part of an elaborate conspiracy to embezzle money. Shulick directed the unspent funds to co-conspirator Chaka Fattah, Jr., an employee and confidante of Shulick and the son of former U.S. Representative Chaka Fattah, Sr. The two agreed that Fattah, Jr. would use the funds to pay off various liabilities incurred across Shulick’s business ventures, while also keeping a cut of the embezzled money for himself.

At Shulick’s trial, a number of former DVHS employees testified to the harmful effects this scheme had. Teachers explained that students dealing with abuse, addiction, trouble with the law, and other personal and familial hardships  never received access to the counseling assistance Shulick promised to provide. Without security staff on site, teachers had to attempt to keep the children safe while also educating them. Some employees confronted Shulick about his failure to pay for these services for Southwest’s students. He would lie and direct his staff to misrepresent and misreport to cover up his fraud. 

(Mike Frisch)