As Seattle Public Schools grapples with what could very well be one of the biggest financial scandals in its history, the question on everyone's mind is where is Silas Potter, the former SPS employee who is being sought for questioning regarding his involvement in alleged fraud in the district's small business program.

A recent state audit (.pdf) revealed that the school district wasted $1.8 million on contract services that were never done or didn't benefit the district in any way. Some of those services, however, did end up benefiting Potter's private company, the Regional Small Business Development Program (RSBDP), which shared its name with the district's program. The audit states an instance when a $35,000 check for the district's program ended up in the bank account for Potter's private company. Potter returned the money only when the district filed a police report.

Both the Seattle Police Department and the King County Prosecutor's office is investigating the case, as is the Seattle School Board, which expects to release a report tomorrow. Potter has reportedly disappeared, but is alive and kicking on the Internet. A quick Google search links Mr. Potter's name to the Regional Small Business Development Program (RSBDP) on multiple websites, but there's really no way of telling whether it refers to the one established by the school district or Mr. Potter's own company. On Classmates.com, Potter's profile says he graduated from Covert High School in Covert, MI, did stints in the U.S. Air Force and Marine Corps, is divorced, and has three kids, one of whom graduated from Columbia Law School.

He is listed as one of the speakers for the 2010 Annual Small and Minority Business Conference on the Small Business Partners for Prosperity website, alongside other notable Puget Sound figures such as King County Executive Dow Constantine, City of Everett Mayor Ray Stephanson, and Seattle Councilmember Bruce Harrell. Potter even shows up on YouTube, where he is featured as a SBPP 2010 business development award winner lauding the district's small business program for helping minorities and women.

"I think anyone who knows me knows I am strictly East Coast—I am very direct, to the point that sometimes it's rude, but I do care about it and have passion for small businesses," Potter says in the video, smiling. "I wake in the morning thinking it and I go to bed thinking it." Potter also talks about plans to change the program into a non-profit and its potential to grow into a "nationwide process of assisting small businesses." "I guess what people don't know is that we are going in that direction," he says confidently.

Ironically, a 2010 state audit reprimanded the district for spending $1.8 million from its capital program on the small business program, including paying for staff salaries and benefits, which should have never been allowed under state law. Potter's vision of expanding the program ended abruptly when he resigned from SPS on June 7, 2010. Oddly enough, the district kept him on as a contractor until June 23 before finally terminating his contract.

There's more, the SPS website shows that Silas Potter and his boss, former SPS Facilities Director Fred Stephens—who was also singled out in the audit for lacking oversight—were both honored for "helping women and minority contractors through the Historically Underutilized Business program at Seattle Public Schools." Potter took home the Walle Ralkowski Award for "his dedication and commitment to diversity in contracting" while Stephens bagged the Crystal Eagle Award for economic development in relation to public contracting.

The audit, through interviews and research, meticulously maps how Potter, by manipulating and misrepresenting contracts, was able to get away with just about anything. It shows how the district could have avoided this debacle by paying closer attention to a report from an outside consultant which criticized the way contractors were being selected for its small works roster. Although Stephens took away Potter's power to award small works construction contracts for the district following this report, he did not remove his authority to award consultant contracts or approve expenditures related to the program.

Stephens also reprimanded Potter for testifying and lobbying in Olympia on behalf of the district without permission, but the audit said that Potter simply flouted his superior's admonitions, mixing private and district businesses at his whim. Initially hired as a relocation coordinator for projects being constructed under the district's Building Excellence Program, Potter was promoted to program manager for the small works roster despite having no experience in awarding contracts and managing personnel, the audit says.

"A lot of people want to ask him a lot of questions, but nobody knows where he is," said Seattle School Board President Steve Sundquist. Well when Potter does resurface, it looks like he will have a lot of answering to do.