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Founders of Houston’s Varnett charter school pleaded guilty to a $2.6 million embezzlement of school-related funds. Marian Annette Cluff, 69, and Alsie Cluff Jr., 69, husband and wife, will face jail sentences and fines after a 19 count indictment.
Per plea agreements, Marian agreed to a maximum sentence of up to 10 years, while Alsie agreed to a maximum sentence of up to 3 years in prison. More than $1 million of the $2.6 million of stolen funds came from parents, who gave school officials money meant for field trips and fundraisers.
Founded in 1984, Varnett school has received about $11 million to $13 million in state funding annually over the past several years. Marian Cluff served as the network’s board president, principal and superintendent, and Alsie Cluff Jr. worked as vice president and treasurer. Prior to their indictments, the Cluffs engaged in pervasive conflicts of interest and questionable governance practices.
Federal authorities allege that the Cluffs schemed opening four “off-books accounts” kept secret from their external accountant and tax preparer. The couple hid money from vendors, insurance companies and federal agencies, and evaded nearly $852,000 in federal income taxes. Cluffs also deposited $115,000 into personal bank account thanks to false invoices from the school’s maintenance. They then ordered the contractor to lie to the FBI and say the money was for a loan they repaid in cash.
The couple also received salaries that were significantly higher than average for leaders of similar-sized schools. In 2013-14, the final year with available compensation data, Marian earned $266,400, while Alsie received $184,000.
The Cluff’s now are seeking buyers for their six-bedroom, 7,000 sq ft estate as they try to pay back the government and local victims. After originally listing their mansion at $3.5 million, the Cluffs gradually have dropped the price to $2.5 million. The Cluffs’ lawyers wrote in court filings that the couple dropped the list price “as a gesture to show their serious intent to sell the home as quickly as possible.”