<a href="mailto: dvsavini@cbs.com; mhlebeau@cbs.com; mayoungerman@cbs.com" target="_blank">Send Your Tips To Dave Savini</a>By Dave Savini

(CBS) – An auto-repair shop teacher at Benito Juarez Community Academy is accused of using students to run a private repair shop out of the school’s garage.

Dave Savini and the 2 Investigators went undercover and found instructor Jose Valdez cashing in while using public school students as free labor.

“We just took half the engine apart and put it back together,” Valdez told a CBS 2 producer as he described the work he and the students were performing.

For repairs, Valdez asked for cash or checks written out to him personally. He did not know he was being approached by CBS 2.

Undercover staff members from the station paid him for an air filter and during another appointment gave him a $200 money order to pay for a tune up.

Instead of having the tune up, CBS 2’s Dave Savini started asking him questions, including: Was this his private business?

Valdez says the operation was not a private business but he is taking in private cars “because the kids need to work on them.”

When asked why checks are being written in his name, Valdez replied: “The check was written to me because I got to pay for the parts.”

But how are the parts paid for? When Valdez replaced the air filter, he charged the part to the school and asked CBS 2 for cash.

Another possible revenue stream: CBS 2 watched as a tow truck from a towing business Valdez owns brought a car to the school seemingly for repair. Valdez would not explain.

What’s happening at the garage is not exactly a secret, sources tell CBS 2.

“The only person that would allow this would be the principal. He has to supervise every teacher,” one source, who requested anonymity, said.

So what does Principal Juan Carlos Ocon know? He declined to comment, but both times CBS 2 was in the school’s garage his car was there being worked on.

“I mean, that’s the kids working on it — not me,” said Valdez, who called for security and told CBS 2 to leave.

No one cared when a CBS 2 representative went in earlier as a paying customer.

Chicago Public Schools’ legal department and Inspector General have each launched investigations. CPS rules say students are not supposed to be given private cars to work on, and no money should be exchanged. Also, strangers should not have full access to the school and students.

There are still some questions being looked into, including: What happened to the money CBS 2 paid the teacher, and who is paying for the parts to fix the principal’s car?

we immediately took steps to investigate the auto shop matter.

“The abuse of taxpayer  resources,  especially  during a time of fiscal crisis, will  not be tolerated in any way,” CPS said in a written statement to CBS 2. “These programs are designed to provide students with  hands-on experience and critical job skills as they prepare for the workforce.  We are currently investigating these allegations and will take the appropriate actions pending the outcome.”

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