Veronica Klinefelt's discovery of fraud during her first year on the East Detroit school board certainly didn't make her life a bed of roses. "People thought we were crazy," she says. Rallied by the construction manager whom Klinefelt says she believed was financing the effort, to remove her from office. The effort included newspaper ads and fliers handed out even to her children's friends as they walked home from school.

"It was intimidating, quite frankly. We knew we were dealing with millions of dollars, and if we disappeared off the face of the Earth, for them, it would all just go away," she adds.

She weathered the cold shoulders and veiled threats, however, to provide legal authorities with the documentation they needed to prosecute. From that experience, she shares this crash course for board members and administrators who would like to avoid the hot seat:

1. "Trust but verify." It is important to have a relationship of trust within a district, but board members and administrators would not be reluctant to ask for back-up information if they have concerns about any bills.

2. Notice unusually close relationship. Klinefelt and her colleague gave the FBI agent a list of who to investigate based solely on who had relationships with outside contractors—and almost everyone on the list was indicted.

3. Share responsibility. Have one person receive the bids and document the date and time of arrival while another person—preferably from another department—takes responsibility for their safekeeping until the bid opening.

4. Watch people's spending habits. "If your maintenance director makes $70,000 and lives in a $3 million home, make a mental note of it!" she says.

5. Check all revenue. Some revenue—such as summer school checks or insurance checks—might not be considered in an audit. Roslyn's finance director was found guilty of helping himself to both those pots.

6. Double-check contractor payments. Superintendents periodically should seek a report (vendor run) on contractors to determine what they have been paid on a bond project and compare that to the contract.

7. Create a separate construction fund. Bond project expenditures should never come out of the general fund.

8. Have the board approve any change orders. There should be no open-ended change orders that give the administration the authority to approve over expenditures.

9. See the contract. Board members should insist on having a physical contract for review before voting to hire any firms.