Feds sentence school superintendent

PIERRE, S.D. — The former superintendent at the Crow Creek Tribal School was sentenced Monday to 10 years in federal prison for soliciting bribes in what prosecutors called a case of kickbacks and money laundering involving federal funds used to replace a student dormitory destroyed by fire.

Scott Raue, 43, of Pierre had been charged with more than two dozen counts, but pleaded guilty in April to one count of accepting a bribe.

Raue and relatives in the courtroom cried as he told U.S. District Judge Karen Schreier that he was sorry for what he had done. He said he knows he has hurt his two children, students and teachers at the school and the contractors he drew into the bribery scheme.

“I know I’ve done so many wrong things to so many people,” Raue said.

Raue’s lawyer, Stan Whiting of Winner, asked the judge to be lenient because Raue has high blood pressure and other health problems. Raue was addicted to gambling and sought bribes to cover his losses in video lottery games, Whiting said, adding that his client is a single parent raising a 7-year-old daughter and an 8-year-old son.

Assistant U.S. Attorney David Zuercher urged that Raue get the maximum sentence of 10 years.

Schreier said after the school dormitory burned in April 2005 that Raue worked tirelessly to get new dorm buildings built quickly so the school could reopen that fall. The judge said Raue’s bribery scheme turned what should have been a great story into a great shakedown that ensnared a number of contractors.

“You were the driving force behind this scheme,” Schreier told Raue.

Schreier said she will recommend that Raue be placed in custody in a federal prison with medical care. She also ordered that Raue join a contractor to repay more than $129,000 to the school.

The charges against Raue indicated he had accepted bribes from contractors before the dormitory fire.

In pleading guilty to one count of bribery, he acknowledged that a contractor paid him between $30,000 and $70,000 in 2005 to ensure the contractor continued to get work at the school.

When Raue was superintendent at the school, it had more than 600 students from the Crow Creek Sioux reservation in central South Dakota as well as students from other areas. The school had a good academic reputation and met annual goals under the federal No Child Left Behind school improvement law.

Earlier Monday, an electrical contractor was sentenced to two years of probation for failing to report a felony in the bribery scheme.

John Nystrom, 55, of Pierre was originally charged with seven counts of bribery, but those charges were dropped when he pleaded guilty to failing to report a felony.

The offense carries a maximum sentence of three years in prison, but Schreier sentenced Nystrom to probation and fined him $5,000 after noting that he had no prior criminal record, was a county commissioner for eight years and participates in many community organizations. Nystrom must also repay the Crow Creek tribe $20,515 and perform 100 hours of community service.

Nystrom’s lawyer, former U.S. Attorney Jim McMahon, said Nystrom failed to report a felony when he did not tell officials that a subcontractor was being paid by him and by the tribe for the same work.

Zuercher, the prosecutor, agreed that Nystrom should be sentenced to probation, but said Nystrom had acknowledged that he concealed the illegal activity involved in the school construction. Nystrom also made payments of about $35,000 to the school’s superintendent, Zuercher said.

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