Here is the latest federal government report on fraud, waste, and abuse in the charter sector. It was released in May 2014 by the Center for Popular Democracy and Integrity in Education. The most common type of fraud identified was embezzlement.
CHARTER SCHOOL VULNERABILITIES TO WASTE, FRAUD, AND ABUSE
With the increase in funding that schools are receiving through the Recovery Act, we issued a report that highlighted past OIG investigations involving fraud at charter schools. The report brought to the Department’s attention our concern about vulnerabilities in the oversight of charter schools. Since 2005, OIG has opened more than 40 criminal investigations at charter schools, which have thus far resulted in 18 indictments and 15 convictions of charter school officials. Charter schools generally operate as independent entities that are subject to oversight by an LEA or authorized chartering agency. Our investigations have found, however, that LEAs or chartering agencies often fail to provide adequate oversight needed to ensure that Federal funds are properly used and accounted for. The type of fraud we identified generally involves embezzlement. The schemes that are used to accomplish this are varied. For example, we have found cases where charter school executives falsely increased their schools’ child count, thus increasing the funding levels from which to embezzle. We also identified an alleged grade changing scheme that allowed failing students to pass in order to ensure that the school met Adequate Yearly Progress, which allowed the school to continue operating, thus continuing a funding scheme from which to embezzle. We have also unraveled schemes where owners or employees of the charter schools created companies to which they diverted school funds and misused school credit cards for personal expenditures. Our report provided examples of investigative cases involving charter schools. The Department generally agreed with our observations and expressed interest in working with OIG in determining how to enhance, when appropriate, its policies and monitoring processes involving charter schools.
Oh but it’s “all for the kids,” Right, embezzlement is some model for children.
There is about as much chance of getting oversight of charters where it’s most needed as getting meaningful oversight of the financial industry.
I think there’s less chance. The financial industry was once regulated. Charter schools have never been regulated. They have an entire deregulatory “authorization” structure in place. Billions of dollars are moving through it. They are never, ever going to consent to a new regulatory scheme.
We just saw this in Ohio. There was a series of back to back media exposes, legislation was drafted, then the charter lobby got to work and it all died. The Ohio Ed Dept promised to begin regulating and that protected the authorizers and management companies.
The state agency essentially intervened to prevent regulation. It was absolutely amazing to watch it happen. They’re not only NOT regulating, they’re using a state agency to PREVENT additional statutory regulation. They’re completely captured.
“Unregulated Derivatives”
— by One DAM Poet (Devalue Added Model)
“Derivatives” of education
Such are charter schools
Fraud and waste sensation
WallSesame Street without rulesCiara, you’re probably tight. Ay least one party sort of wants to rein in Wall Street. Neither party want to rein in charters.
Which party wants to rein in Wall Street?
One party – sort of. At least some Democrats Luke Warren.
Not my friend Democrat Cory Booker.
There’s another comparison to the financial sctor that I think applies. The relianceon data rather than experience, observation or common sense.
Janet Yellen says that she was hearing rumblings about a housing sector crash in 2005-6. But she looked at the data and there was no weakness revealed there. It wasn’t there, wasn’t predicted, simply didn’t appear.
Yet lots of people “on the ground” were telling her “this is a house of cards”
We knew it here. Residential property in the rust belt doesn’t increase in value at 30,40,50 per cent over 4 years. We knew it was a fantasy.
Chiara, that also points out the consequences of looking at the wrong data or looking at the data the wrong way. Michael Lewis points out that just before the crash a few people looked at the data, at least the real data in a different way, bet against the market, and made a bundle. They actually looked deeply and saw they crappy mortgages that were being sold as prime.
I think Yellin did the same thing some in education do: look at the data and see what they want to see and miss what they don’t want to see. I’m not a charter fan, but I realize there are some basically decent people who have bought into charters (pun?) and can’t see what seems obvious.
The SEC, ignored Bernie Madoff, and they had both data and experience. The SEC could pass regulations about agents and pensions but, they won’t.
We can watch the turn of the powerful revolving door at the Open Secrets website.
It’s easier for politicians to relinquish public schools to private companies and think tanks and lobbyists.
I hope it blows up in their faces. There should be accountability for people who don’t do the job they were hired and paid to do.
I’m not clear what we’re paying these people to do in a choice system. Set up a website? Distribute funds? Why can’t we outsource that to a contractor? I think we’d get more rigorous oversight from a private accounting firm.
The choice folks should practice what they preach and outsource their own publicly-paid employment. I don’t need a publicly-paid 3 figure “school CEO” to run a OneApp website.
They don’t want public schools? Okay. Then we don’t need publicly-paid ed reformers to run a privatized system. We’ll contract out top management, too. We can start with Duncan and then move to the “state chiefs”. Let’s privatize the big jobs along with the little ones.
Good idea! Privatize the whole damn thing. Is any one still around from Enron to cook the books big time?
“The Robber Barons”
— by One DAM* Poet (*Devalue Added Model)
They robbed us of our pensions
They robbed us of our homes
They feasted in their mansions
And threw us “doggy” bones
They rob our children’s future
With charters for “investing”
That man in that new suit there
Is worthy of arresting
The new suits bloviate from one end
All the while, the mammon up sucking
While out the the other end
Out comes the outcome for suckers
Keep em coming, DAM larry, keep em coming!
Are you publishing your poems?
Yeah, here. 🙂
Here’s another
“Gulenalogies”
— by One DAM Poet
Gulen is to charter
As Sun Myung is to Moon
As mouth germ is to tartar
And Porky Pig’s to Tune
Oversight is a joke at most schools. Charters are doing ,in a lot of instances, what public schools are doing but public schools get more scrutiny because they have a bureaucracy that is supposed to perform oversight but rarely does. Look at the public schools, do you really think they are doing all these grants and programs legally? No, they shirt the law or just plain don’t follow the law knowing that they can get away with it. Why? Teachers and staff are too scared to report it or are being bought off. Department of education at the state level or feds don’t do anything because its easier and more profitable to do nothing. Look at the noncompliance issue regarding special education. When school districts or even individual schools are caught denying students basic due process, what does the state or feds do. Slap them on the hands and tell them to fix it and not do it again. It won’t hurt these entities until you take their money away or put them under serious monitoring. Real oversight is not happening a lot in education. That’s why teacher, parents, the community have to be the sentinels. Will you get rewarded for this, no, you’ll probably loose you job if you’re a teacher and be ignored if you’re a student or parent. Together, students, parents, teachers, can not be ignored. So basically, what I’m saying is that we have to be the oversight if we care about our schools.
Newark has been out of compliance with the State on Special Ed issues for as long as I can remember.
My most recent school was reportedly paying a consultant 90 grand per year to oversee Guided Reading instruction for upper grades. As best I could tell, the consultant visited our school once a month. Am I to understand that there is no one in our district qualified to do PD on Guided Reading?
I haven’t been bought out yet. Is anybody interested?
Compliance has been a serious issue in Michigan where I work. As far as I can tell it is due to expectations from superiors up the line. From what I hear from charter teachers is different.
The charter school movement is ” too big to fail”
too corrupt to succeed
And, Linda, I think this statement will be proven correct!
And none-too-soon for all of us!
The founder of a charter school here in Camden, NJ (yes, Camden again) directed her state-funded school custodian to take care of her lawn at her home in the tony suburbs. He blew the whistle. She fired him. It made the papers. To my knowledge, nothing was done. It may sound like a small infraction to some, but it may also be the tip of the iceberg when it comes to charter schools in general.
I am one of the 200 plus teachers that was laid off by Camden City Schools. I walk by this charter school every day and see my former students. Yep-the best and the brightest.
We’ve got the information. I wish I had a solution. Today.
The trick is to get your state legislature to pass laws saying background checks are “optional” for a charter school. That way, the charter operator can hire, say, a financial wiz under investigation for embezzlement to serve as the school’s CFO. Operator can play dumb, claim school was “saving money” by not performing background checks, thus saving face. Or, they pay a guy charged with embezzlement (consultation fee) to teach them how to game the system. Either way, with no regulation, no oversight, the possibilities for corruption are endless.
larry–Welcome! You’re poetry is brilliantly hilarious!
That’s what folks here in Bay City MI are charged with. Four individuals, some family members and close to a million dollars.
Is the Network for Public Education still collecting eye-witness accounts of charter improprieties? Because in addition to embezzlement “the theft or misappropriation of funds placed in one’s trust” which every charter operator who invents job descriptions for an overpaid “school CEO” is guilty of, there is extortion, which “involves the verbal or written instillation of fear that something will happen to the victim if they do not comply with the extortionist’s will” ie. give us your schools or else, do your mandatory volunteer hours or else, take your kid out of class to attend our rally or else, etc. propaganda.
Also, we can’t forget racketeering, “a service that is fraudulently offered to solve a problem, such as for a problem that does not actually exist, will not be affected, or would not otherwise exist”
One problem is that victims tend to be ashamed of and silent about being ripped off, and charter operators know how to pick their victims
Are you sure this is a federal government report?
Although I do not support the charter school movement, let’s be careful before we throw the stone of financial corruption at charter schools. After all, we in public education do not have such a wonderful history when in comes to fiscal scandal, grade changing, misappropriation of funds and all sorts of inappropriate behavior by teachers and administrators. Let’s win the argument against charter schools and the need for better public schools on professional training, and our continual commitment and dedication to all the children of America.