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I-Team Investigates Former Administrator's Alleged Scam To Steal $325,000 From Schools

By Charlotte Huffman

PHILADELPHIA (CBS) -- A South Jersey man is accused of running an elaborate scam to steal hundreds of thousands of dollars from schools.

Robert S. Armstrong, 44 of Franklinville allegedly mailed more than 70,000 fraudulent invoices to schools nationwide.

Armstrong is the former Assistant Principal of Sooy Elementary School in Hammonton.

The invoices, which looked like this were mailed between July and September 2014 and sought payment in the amount of $647.50 for textbooks from Armstrong's company, "Scholastic School Supply."

The United States Attorney's Office says schools never placed the orders and the textbooks never even existed.

But hundreds of school administrators in at least 36 states wrote checks and mailed them to Armstrong's drop boxes in Las Vegas, NV and Sewell, NJ.

Agents with the U.S. Postal Inspection Service say Armstrong opened more than six bank accounts for Scholastic School Supply and deposited checks from victim schools amounting to more than $325,000.

The I-Team reviewed purchase orders and found Blackfoot Charter was one of several schools in Idaho that paid the invoice.

Eyewitness News Investigative Reporter, Charlotte Huffman alerted school administrators who were unaware they had been scammed.

"I was deeply disappointed that someone would do this to us … We are such a low funded school. We struggle for every penny we can get. This plan was so well devised and the timing was so perfect that they were able to sneak it through on us," said Blackfoot Charter School's director, Fred Ball.

In order for the invoice to appear legitimate, authorities say Armstrong included a telephone number and a Federal Employer Identification Number (FEIN) for Scholastic School Supply.

The invoices also included International Standard Book Numbers (ISBNs), unique identifiers assigned to each book published in the United States.

All three numbers were phony - the telephone number was out of service, the FEIN did not exist, and the ISBNs were either non-existent or did not correspond to the textbooks listed on the invoices.

According to Dun & Bradstreet as well as Department of Treasury Records, Scholastic School Supply is not a registered business.

"I've been an educator for 16 years. I would never do anything intentionally to defraud any school," said Armstrong.

"So how do you explain this invoice?" Huffman asked Armstrong.

"If you speak to my lawyer he would be more than happy to talk to you about that," Armstrong said.

"But surely you can explain this invoice for textbooks," said Huffman.

"Invoices were sent. Some on my behalf and some were not authorized. That's pretty much all I can say," Armstrong responded.

Armstrong's attorney Rocco C. Cipparone, Jr., Esq. of Haddon Heights, N.J. tells Eyewitness News he cannot elaborate on the case.

"Because I'm in the process of reviewing discovery and anticipating more discovery from the government I'm not in a position to discuss (it)," said Cipparone.

The feds have arrested Armstrong and charged him with mail fraud.

One week after the arrest, federal agents charged him with a second count of mail fraud after they caught him running another scheme in which he allegedly mailed fraudulent invoices to colleges and trade schools from another company, "The Trend Publishing."

In that scam, investigators say Armstrong sought payment in the amount of $495.00 for an advertisement in the "College Edition." Prosecutors say victim colleges and trade schools never ordered the advertisement.

The I-Team tied Armstrong's Franklinville residential address to seven businesses offering everything from loans to insurance and witnessed a mail carrier pick up a large stack of envelopes from his mailbox.

The U.S. Attorney's Office says the money will be returned to the victimized schools at the end of the case.

The charge of mail fraud is punishable by a fine of $250,000 or twice the loss to the victims or gain to the defendant, whichever is greater and a maximum of 20 years in prison.

If you believe your school was victimized call the U.S. Attorney's Office, New Jersey District at (973) 645-2888.

If you have information about possible fraudulent conduct, call postal inspectors at 877-US MAIL 5 (877-876-2455).

Scholastic School Supply is not affiliated with Scholastic Inc., the well-known, global company that publishes classroom magazines and children's books.


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