Ex-state Senate hopeful accused of mail fraud

A former Republican candidate for the Nevada Senate has been indicted by a federal grand jury on charges of mail fraud and money laundering at a private school he ran in Milwaukee.

Henry E. Tyler, 39, made a failed bid last year for the seat that Sen. Bob Coffin, D-Las Vegas, vacated because of term limits.

Tyler was indicted on five counts of mail fraud and one count of money laundering that he is accused of engaging in while head administrator of the L.E.A.D.E.R. Institute, a now-defunct private school that accepted vouchers. Milwaukee has the nation's largest school voucher program, which pays for low-income students to attend a private school within the city limits.

Tyler bilked a federal food program out of $196,000 by inflating the number of students receiving subsidized school lunches in 2006, according to the indictment released Tuesday. He was reimbursed for 372 students "when in fact the total was much less," and he used the federal money to cover $15,000 in personal checks he wrote to himself and his wife, the document says.

He faces up to 30 years in prison for the combined charges.

"I never defrauded anyone of anything," Tyler said. "I think there's a concerted effort to discredit me."

Tyler said he continued to receive federal reimbursements months after the school closed and assumed the money was his to do as he wished.

Wisconsin officials ejected L.E.A.D.E.R. from its school choice program in 2006, citing insolvency. Tyler moved to Nevada that year.

Officials said the school owed nearly $500,000 for improperly cashed checks, improperly claimed summer school payments, past payroll payments and other debts, according to the Milwaukee Journal Sentinel.

Tyler blamed some of his financial problems on his decision to pay employees when he lacked the money and on the state changing the way it administered funds and oversaw voucher schools.

The state began auditing the books at the start of the year instead of the end, catching him short on funds, he said.

In 2010, Tyler won the Republican primary for District 10 but lost in the general election to Ruben Kihuen, a Las Vegas Democrat who gave up his Assembly seat to run for state Senate.

Tyler received and spent no campaign money in either race, Clark County records show.

Republican leaders wrote off this contest because Coffin's district was so heavily Democratic, preferring to funnel their resources to competitive races, said Chuck Muth, conservative political analyst.

"The race for Coffin's seat wasn't on the Republican radar," Muth said.

But Frank Ricotta, local Republican Party chairman, said his organization concedes no races and plays no favorites. The local party has little money and instead uses volunteers to help all its candidates get the word out, he said.

Ricotta said he didn't know about Tyler's legal troubles.

"I never heard a whisper of this from the primary to the general election," Ricotta said.

Contact reporter Scott Wyland at swyland@reviewjournal.com or 702-455-4519.