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A Piece of the Action 

How a bright and beguiling budget analyst allegedly fleeced a showcase minority aid program at SFSU

Wednesday, Mar 8 2000

Page 4 of 4

While investigators leafed through the financial records, Walter circled outward toward the businesses listed on the checks. At Cafe Dang, she told the court, she found nothing more than tables, chairs, and beer pitchers. Then she tracked down Luu's boyfriends.

Hieu Sam immediately spilled the beans, she says. Sam said he had never worked as a teaching assistant, or provided any printing or catering services to the university. And yes, he had signed the checks he received from the university, and deposited them, giving Luu money when she needed it. They had been lovers, he said.

Reuben Flores denied everything, though he was living with Luu. He said he had never worked for San Francisco State, and had never received any money from the university. The signatures on the back of the checks were not his, he said, and he had never heard of Cafe Dang or Thuy Duong Printing.

Anthony Hang hesitated, then admitted everything, Walter testified. First, Hang said he was given checks to do some printing. He denied cashing the checks, then admitted to cashing them, Walter says. Hang would keep some of the money, and give the rest to Luu. She was his girlfriend, he said.

In March 1998, the District Attorney's Office began its own investigation, which focused on Luu and her accomplices, but not her bosses at the Educational Opportunity Program. Head and Mendez eventually testified against Luu without grants of immunity, meaning the District Attorney's Office may still prosecute them if it's so inclined. In the meantime, the university has reassigned Head to the College of Ethnic Studies, and Mendez to the department of student outreach services.

The university fired Luu in April 1998.

Needless to say, the affair has been a grave embarrassment to the university -- to the point that no one in a position of authority wants to say a word about it.

"It's really not in my best interests to say anything," Head says.

Mendez did not return numerous phone calls.

University President Robert Corrigan's office referred all questions to the university's public affairs coordinator.

Ligeia Polidora, a public affairs officer, responded to a few basic questions, then referred all further inquiries to the District Attorney's Office.

Stuart Hanlon, an attorney representing Nancy Luu, declined to answer questions, but did note that a grand jury indictment tells only one side of the story.

Considering that Head and Mendez have already admitted to failing in their fiduciary duties, it would seem logical to at least include them in the investigation. Investigators believe more than $200,000 slipped out the door on their watch, and they have admitted to authorizing every dollar that escaped.

Yet, for reasons the office will not explain, the district attorney has thus far given the gentlemen a pass. "Unfortunately, two people who could have stopped [the theft], could have caught it, simply trusted her," Albert Murray says in his closing arguments to the grand jury. "And it happens, and it's nice that we can trust people in the workplace. There's not one of you who's going to go away from here without a lesson.

"Morris Head and Paul Mendez learned a lesson, a very harsh lesson. I think that lesson has spread throughout the institution of learning out there. But it happened. Morris Head and Paul Mendez just trusted her fairly well, and they just signed whatever was put in front of them, and that's how it happened. The program suffered. The university suffered. The students suffered."

Actually, the university as a whole has not suffered greatly -- SFSU, after all, has a $190 million annual budget -- but the Educational Opportunity Program has certainly felt the pain. If campus investigators are correct, and Luu, indeed, pilfered more than $200,000 over a two-year period, she drained 10 percent of the program's budget each year, without a bit of interference from the program's top administrators.

The university has rejiggered the management of the Educational Opportunity Program, but it will take awhile to repair the damage that has been done. The program has been knocked down a notch in the administration's eyes, officials in other departments say, and in this respect, Luu's alleged misdeeds continue to have their effects.

When Luu joined the Educational Opportunity Program in 1992, the office was nestled within the university's main administration building, a cornerstone of the campus. But after an earthquake retrofit of the building, the administration relegated the program's staff to the school's old humanities building, the most dilapidated, rat-infested structure on campus. The program's affirmative-action crusaders, once considered the heart and soul of the university, now work in cramped offices smelling of sweat. The department's new director, Rick Gutierrez, does not even have a desk; he has a table stacked with papers in a barren room.

The office has struggled since the university discovered the theft, he says. Last year, the administration unexpectedly cut the program's annual budget by $113,000. The university has brought him in to clean up the books, but the program has yet to regain the administration's trust.

"They count every penny," he says. "The scandal has had an effect, because now the administration can say, 'You survived without that money. Maybe you don't need so much.'"

About The Author

Matt Isaacs


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