Schrenko's list of charges grows

ATLANTA - Linda Schrenko, the embattled former state superintendent of schools and unsuccessful gubernatorial candidate, faces additional charges as the result of a new federal indictment returned Tuesday.

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Linda Schrenko: Former schools official is now charged with wire fraud and money laundering. File/Staff

The indictment adds the charges of wire fraud and money laundering to the embezzlement charges she is already facing. Both carry significant jail time if she is convicted.

Ms. Schrenko is accused of ordering bogus contracts for computer services totaling more than $600,000 in federal funds granted to the Georgia Department of Education while she headed the agency. Prosecutors say she and her co-defendants used a complex series of transactions and offshore bank accounts to try to "launder" the money, or make it untraceable, as they channeled it into their own pockets and into her 2002 campaign for governor.

By listing each suspect transaction, the number of counts she faces rose from 18 in the original indictment handed down in November to 47.

Tuesday's indictment supersedes the November indictment. It removed the name of her co-defendant and former deputy superintendent, Merle Temple, of Evans, because he had pleaded guilty last month. At the same time, it added a defendant, Peter Steyn, 60, of Woodstock, Ga.

Mr. Steyn was the chief operating officer in the computer companies that allegedly received the phony contracts, and he is accused of structuring some of the money-laundering transactions. The owner of the companies, Stephan Botes, 47, of Alpharetta, Ga., was named in both indictments.

Attorneys for Ms. Schrenko and Mr. Botes have repeatedly maintained that their clients did nothing illegal. Mr. Steyn does not yet have an attorney, according to the U.S. District Attorney's Office in Atlanta.

Ms. Schrenko's attorney, Pete Theodocion, said prosecutors merely reclassified some of their allegations in the new indictment.

"There was nothing that was alleged in today's indictment that wasn't alleged before," he said, adding that it would not frustrate her defense.

Mr. Temple, who faces 35 years in prison when he is sentenced April 7, has agreed to cooperate with prosecutors and would likely testify against Ms. Schrenko when her case comes to trial.

No trial date has been set. She must enter a plea again on the new charges in federal district court Friday morning before U.S. Magistrate Judge Gerrilyn Brill. Ms. Schrenko pleaded not guilty to the original indictment Nov. 14.

Mr. Temple isn't the only person implicated in the case to plead guilty. Three others who were charged separately also pleaded guilty, including Ms. Schrenko's campaign manager, Richard Leonard, 43, of Augusta; Miller E. Finley, 64, of Evans, who was an Education Department aide at the time in charge of the federal funds allegedly stolen; and Jonathan Turner, 36, of Barnesville, Ga., the chief financial officer of the computer companies.

Reach Walter Jones at (404) 589-8424 or walter.jones@morris.com.

--From the Wednesday, February 9, 2005 printed edition of the Augusta Chronicle