BALTIMORE, MD – Tyrone Sherrod, 49, of Aberdeen, Maryland, isn’t using federal grant money to help Baltimore kids. He’s flushing it down the drain at the casino. Sherrod pleaded guilty today to wire fraud and filing a false tax return, admitting he pilfered over $746,000 in funds earmarked for after-school and summer programs for city youth.
The scheme unfolded between 2016 and 2018. Sherrod’s non-profit, which operated at a Baltimore elementary school, received approximately $1.1 million in federal funding through the U.S. Department of Education. The money was supposed to pay for legitimate program expenses. Instead, Sherrod inflated payroll records, submitting falsified Project Invoice Summaries that claimed a total payroll of $746,005.02 when the actual payroll was a paltry $212,622.55. The lies included bogus wages, hours, and employment periods. On one particularly brazen occasion, he reported a $54,200.85 payroll when only $1,000 was actually paid.
But the inflated invoices weren’t about enriching employees; they were about feeding Sherrod’s gambling habit. The U.S. Attorney’s Office revealed Sherrod was a regular at Maryland casinos, and a significant portion of the stolen grant money flowed directly into the slot machines. On March 5, 2018, a $39,747.29 grant payment arrived, and within hours, Sherrod had cashed out $28,500 in checks and was gambling with $52,270, losing a staggering $34,345 in a single day. Over the three-year period, Sherrod racked up approximately $547,000 in gambling losses and withdrew $552,405 in cash from a single casino’s ATM.
The deception didn’t stop there. Sherrod also filed false tax returns for 2016, 2017, and 2018. He provided a CPA with fabricated expense sheets, falsely claiming work as a mentoring coach to justify a Schedule C attachment. He deliberately concealed the grant funding from his accountant, effectively underreporting his income and avoiding taxes. He treated himself as a contractor in an attempt to further manipulate the returns.
U.S. Attorney Erek L. Barron minced no words, stating, “Sherrod gambled away federal grant funding intended to uplift Baltimore youth.” He vowed to continue prosecuting those who exploit federal funds for personal gain. The investigation was a joint effort by the FBI, IRS-Criminal Investigation, and the U.S. Secret Service – Baltimore Field Office. Special Agent in Charge Bo Keane of the Secret Service confirmed their involvement, highlighting the agency’s focus on financial crimes.
Sherrod’s sentencing date has not been set. He now faces the consequences for betraying the trust placed in him and robbing Baltimore’s children of vital resources. This case serves as a grim reminder that those entrusted with public funds will be held accountable for their actions, no matter how cleverly they attempt to conceal their greed.
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Key Facts
- Agency: U.S. Secret Service
- Category: Fraud & Financial Crimes
- Source: Official Press Release
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