Four Charged With Embezzlement of School District Funds

After more than a year-long investigated, four men have been arrested by the Somerset County Prosecutor's office for allegedly embezzling over $2 million over six years from the Bernards Township School District.

Robert E. Titus, former District Manager of Aramark Corporation – the food and maintenance service provider for the Bernards School District – John Paris, owner of John Paris Construction, Edward Beach and Gabriel Caponetto were charged with perpetuating the scheme that ran from January 2003 to October 2008.

All of the money taken was reimbursed by Aramark Corporation to the school district. "Aramark has made complete restitution for all monies lost as a result of the actions of its employee, and has additionally refunded to the District all profits realized from our account dating back through 2002-03," Superintendent Valerie Goger said in a letter to Bernards residents today.

"Throughout this entire period of investigation Aramark has acted honorably and cooperated fully with the Board and the Prosecutor's Office in seeking justice. As the financial victim in this situation, they are pursuing legal avenues to reclaim their lost funds," Goger said.

Aramark has provided food, janitorial and maintenance services for the Bernards School District since 1999. Titus worked as the District Manager for Aramark in Bernards out of an office at Ridge High School.

Because Aramark won the bid to provide services in the school district, Titus was able to hire independent contractors through a no-bid process for maintenance and construction projects in the district.

In July of 2008, Nick Markarian, who was just starting his current role as Business Administrator for the Bernards School District, noticed a discrepancy between the amount charged to the school district on the invoices submitted by Titus and the actual work that was being completed. Titus was confronted, admitted to doctoring an invoice and left his post in October 2008.

Markarian notified Bernards Superintendent Valerie Goger about the situation, who notified the proper authorities, and in December 2008, informed residents that the district had uncovered evidence of embezzlement. The Somerset County Prosecutor's Office began its investigation into the case around the same time.

The findings, released today, allege that Titus and three accomplices were involved in the money-laundering scheme. The investigation claims Titus used one contractor, John Paris Construction for nearly all construction, maintenance and repair projects from 2003 until he left in 2008.

In exchange for all of the work, Paris has been accused of inflated invoices for Titus to process. Titus would keep some of the extra money paid out by the school. To disguise the transaction, Paris developed two schemes using check-cashing stores with the assistance of defendants Beach and Caponetto, according to the accusations.

Paris is accused of making checks payable to cash and delivering them to Caponetto via a third party. Caponetto then would cash the checks in his company's name, GMC, keep $100 per transaction, and send the rest via third party to Titus, according to the report.

The second scheme also involved checks from Paris, this time delivered to a check-cashing store in Hazlet, New Jersey, where Beach worked as a manager. Beach allegedly would cash the checks in the names of randomly selected clientele from the store's computer database, take some of the money in each transaction and have the rest delivered to Titus.

The Prosecutor's office believes most of the money obtained by Titus was used to pay off gambling debts.

All four are expected to turn themselves in to detectives from the Special Investigations Unit today. The charges and narrative submitted in the report and this article are accusations, and have not been proven in a court of law.

Titus and Paris have both been charged with first and third degree money laundering, second degree theft by deception and second degree conspiracy to committ money laundering and theft by deception. Beach has been charged with first degree money laundering, third degree money laundering, third degree forgery and third degree uttering forged instruments. Caponetto has been charged with third degree money laundering.