Eric Rego: CARES Program Fraud, Sentence, and District Response

Eric Rego, the former after-school program coordinator for California’s Mt. Diablo Unified School District, was sentenced to 33 months in federal prison for stealing approximately $3.465 million from the district’s CARES after-school program, a state-funded initiative serving low-income students. Over nearly four years, Rego used fake invoices to buy hundreds of iPads, MacBooks, GoPros, and other electronics with grant money, then resold the devices to pay off gambling debts.¹

How the Scheme Worked

From roughly July 2020 through May 2024, Rego exploited the fact that he sat between the district and the outside nonprofits that ran day-to-day operations at CARES school sites. He told an employee at one of those contracting nonprofits that iPads, MacBooks, GoPro cameras, and other electronics were needed for students in the after-school program. That was false.²

Rego then directed the nonprofit employee to bury the cost of the devices inside the nonprofit’s monthly invoices to the district, hidden under a line item for “subcontracts and supplies.”² Because Rego was also the district employee responsible for reviewing and approving those invoices, he signed off on them himself, certifying the charges as legitimate program expenses.³

The devices never reached schools or students. Rego kept them and resold them at a fraction of their cost to raise cash.⁴¹²

How It Was Caught

The district itself uncovered evidence of financial irregularities in its after-school care contracts, reported the matter to the Concord Police Department, and hired an independent forensic accountant to audit the finances. The audit confirmed that hundreds of electronic devices had been purchased with program funds but never delivered to district sites or used by students.⁵⁶

The FBI and Concord police then investigated jointly. A federal indictment was filed under seal on January 30, 2025, in the U.S. District Court for the Northern District of California.⁷ It was unsealed on February 4, 2025, and Rego, then 39 and living in El Dorado Hills, was arrested. He was charged with three counts of mail fraud, each carrying a maximum of 20 years in prison and a $250,000 fine.²

The Sentence

U.S. District Judge Yvonne Gonzalez Rogers sentenced Rego to 33 months in federal prison. His attorney, Candice Fields, had asked for 27 months.¹ The case is USA v. Rego, Case No. 4:25-cr-00023.²

The court ordered Rego to pay $3,638,250 in restitution: the $3.465 million he stole plus a 5 percent processing fee. He was ordered to surrender by June 26, 2026, to begin serving his sentence.¹

District Response

Superintendent Adam Clark said in a statement the day of the arrest: “Anyone who attempts to misuse funds intended for the education of our students will be held accountable. We are committed to full transparency and will continue to take decisive action to safeguard public resources and protect the integrity of our programs.” The district said it was cooperating with local, state, and federal law enforcement and would pursue all legal avenues to recover the funds. No other district officials were publicly identified as disciplined or terminated in connection with the fraud, and the district did not announce specific new financial controls beyond the forensic audit it had already commissioned.⁵

The mechanics behind the loss were straightforward. One employee could both request purchases through a contracting nonprofit and approve the invoices for those same purchases, and no one independently verified that the goods ever reached students. That gap let the scheme run for almost four years.

1
East Bay Times. Ex-Mt. Diablo School District Manager Sent to Prison for Stealing $3.465 Million From Low-Income Kids Program
2
U.S. Department of Justice. Former Employee Charged With Defrauding Mt. Diablo Unified School District in Fake Invoices Scheme
3
CBS News Bay Area. Mt. Diablo Unified School District Fraud
4
NBC Bay Area. Former Employee School District Scheme
5
Mt. Diablo Unified School District. Statement Regarding Arrest of Former MDUSD Employee
6
Patch. Mt. Diablo USD Employee Pocketed Millions in Fake Invoice Scheme
7
PACER Monitor. USA v. Rego