FBI Searches Home of Former Burlington School Official in Fraud Probe

Federal agents searched the Colchester home of Stephanie Phillips last week as part of an investigation into alleged embezzlement from the Burlington School District. The search warrant was executed by the Federal Bureau of Investigation in connection with claims that Phillips stole nearly $1.8 million over a 13-year period. Phillips retired this spring after serving as the district’s executive director of teaching and learning.

Court documents state that investigators have probable cause to believe Phillips committed mail fraud, wire fraud, and theft involving federal programs dating back to March 2013. The allegations center on a company named Leading and Learning Consultants of VT, which investigators describe as a false entity controlled by Phillips. According to an affidavit filed by FBI special agent Eric Boyce, the LLC appears to be a shell company created to allow Phillips to illegally obtain district money.

Investigators say Phillips submitted invoices to the school district for work she was already required to do as part of her official duties. This practice allowed her to be paid twice for the same labor. The documents further allege she created invoices for services she never delivered. The total amount alleged to be stolen is at least $1,769,200.

Superintendent Tom Flanagan emailed the school community on Tuesday evening to explain how the discrepancies were found. He stated that the district identified concerning financial issues after Phillips left her role. Flanagan said the district immediately reported the findings to local and federal agencies. He added that the school board has reviewed and strengthened its procurement and invoicing procedures, including tighter limits on individual spending.

Phillips, 57, worked for the Burlington School District for 28 years, according to district spokesperson Russ Elek. She began her career as a classroom teacher and holds a master’s degree in education from Saint Michael’s College. In 2014, the school board appointed her as interim superintendent after Jeanne Collins resigned. Phillips has not been charged with a crime and could not be reached for comment on Tuesday night.

Flanagan wrote that the district will work with an outside expert to protect its finances moving forward. He stated that if the allegations are proven, the district and community are victims who will seek to recover all funds for students. Flanagan noted that the district may not provide more details until the federal investigation is complete, but emphasized the importance of serving students during this time.

The investigation was first reported by journalist Michael Donoghue of Vermont News First. The case involves financial records, business documents, and emails collected by authorities. The FBI affidavit details the specific mechanisms Phillips allegedly used to move money from the district to her private company over more than a decade.