Former MPS interim chief school financial officer pleads guilty in fraud case

MONTGOMERY, Ala. (WSFA) - A woman who used to run the finances for Montgomery Public Schools has pleaded guilty after prosecutors say she used that job to run a financial scheme.

Alabama Attorney General Steve Marshall announced that Brenda Palmer pleaded guilty to two felony ethics charges and two felony counts of lying to the attorney general’s office about a matter under investigation. Her trial was set to begin Monday before the plea.

Palmer’s sentencing hearing is scheduled for Oct. 3 before Montgomery County Circuit Judge James Anderson. Marshall said she will be sentenced as a habitual felony offender since she has previously been convicted of first-degree theft of property. She faces 10 to 99 years on the two ethics charges, and two to 20 years on the lying charges.

Palmer used to be MPS’ interim chief school financial officer. Prosecutors say used her role to facilitate a fraudulent billing scheme that “deceived MPS out of $291,367 between November 2017 and April 2019.”

Her accomplice was Walter James, the former vice principal of what used to be called Jefferson Davis High School and is now JAG. He pleaded guilty in both state and federal court for his role in the scheme and is serving a 60-month prison term.

Marshall said their scheme involved James submitting fraudulent invoices from nearly a dozen nonexistent companies that purported to provide various MPS entities with books, professional development and other goods or services. He said Palmer and James both knew no goods or services were being provided. James then created fraudulent invoices with Palmer’s help, and Palmer used her position to ensure they were paid without attracting attention.

The attorney general said Palmer’s efforts to avoid detection included forging at least two employees’ names on checks and other written instruments while directing subordinates to work overtime to prepare legitimate checks so the fraudulent ones would be less likely to be noticed. He said she then pulled out the fraudulent checks from the legitimate ones so James could pick them up personally. He said this was necessary for the scheme because the face of the checks showed addresses for the fake companies that were either nonexistent or otherwise undeliverable. After James deposited the MPS checks into his Navy Federal Credit Union account, he paid Palmer with cash in the amounts she demanded. Marshall said this was documented by text messages between the two.

The scheme came to light after an audit in 2019. Marshall said Palmer shredded check files she was asked to give to auditors and “claimed that she bypassed procedures because she just wanted to get vendors paid.”

Palmer resigned when confronted by the new chief school financial officer. She then left with her pension until Tuesday’s guilty plea, the attorney general said.

Marshall delved further into the investigation, saying Palmer “lied repeatedly” to his office about the scheme and told James to lie too and try to frame an innocent person in the MPS accounts payable department. Marshall said Palmer didn’t know that James was already cooperating with state and federal authorities and agreed to record a phone call with her.

“Betraying the public’s trust is never acceptable and will not be tolerated in our state. In this case, Mrs. Palmer’s brazen corruption and utter disregard for the law was astonishing. My office will continue to identify and prosecute those exploiting the public sector for personal gain,” Marshall said in a statement.

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