The Philadelphia Inquirer reported on a federal audit that had surprising findings.
A national audit of charter school management companies by the U.S. Department of Education has spotlighted an unnamed Chester City school where, auditors say, the CEO wrote checks to himself totaling $11 million without board approval.
The report by the Office of Inspector General did not accuse the CEO of wrongdoing, but offered its finding as an example of a conflict of interest and lack of financial controls that could make the schools vulnerable to fraud. The report cited similar issues at four unnamed Philadelphia charter schools…In the instance of the Chester school, federal auditors reported that the CEO of the management organization wrote checks to himself in 2008-09.
While the audit did not name the school, there is only one charter in Chester City – Chester Community Charter School…
The school, which has more than 3,000 K-8 students, is the largest brick-and-mortar charter in the state. The most recent annual report from the state Department of Education shows that the school had total revenue of $45.1 million in the fiscal year 2013.
Vahan H. Gureghian, a lawyer and entrepreneur who has been active in Republican politics, is the founder and CEO of CSMI Education Management, which manages Chester Community Charter School.
Auditor General Eugene De Pasquale repeatedly has criticized the ties between Chester Community and Gureghian’s firm….
In addition to Pennsylvania, the states where charter schools were reviewed were California, New York, Florida, Michigan, and Texas.Investigators found internal control weaknesses with charter management organizations at 22 of the 33 schools reviewed. They spotted 24 cases of conflicts of interest and transactions with related parties at 17 of the charter schools.
Answer: Because of no oversight and he could get away with this crime.
How we can put our young under the care of immoral people like this is beyond me.
This fraudulent behavior continues while the Chester Upland School District is barely hanging on. The crooked Chester charter wants to absorb what is left of the public schools in the area. Such gross theft and mismanagement cannot be ignored. Governor Wolf needs to find ways to stop the wasteful and corrupt charters from draining public money from the commonwealth while pushing public schools into bankruptcy.
Cost control failures – 66% !!!
Obvious weak link- legislators who answer to grifters and to anti-union, anti-woman, anti-tax billionaires instead of to constituents -legislators who care about themselves and not about good government, not about honesty, not about American democracy and, not about the future of communities in their states.
Another DeVoodoo move: https://truthout.org/articles/devos-accused-of-scheming-to-stop-next-president-from-canceling-student-debt/?eType=EmailBlastContent&eId=a73e4a6e-ce29-4867-a323-18efe1808739
It’s a free for all and the biggest fraud wins the pot of gold. Let’s hope that gold is just dung covered with glittering gold paint.
“Crawley said that under a management agreement signed in 2001, the company “was responsible for all expenses of the school, including physical plant, operations, and staff and teacher salaries.”
He said that the budget also was approved by the board of the school, which is a nonprofit, and that the management company provided monthly reports on all school-related expenditures.”
I think this part is important to understand. There are two boards. School and management company. The nonprofit school outsources everything to the for profit management company. Then the for profit management company turns around and points back to the school as having approved “expenses”.
There’s probably another layer too- the authorizer.
Charter schools are really just a set of contracts. With each layer the regulatory and oversight mechanisms get more and more attenuated and muddled, leaving no one as ultimately responsible. It’s really not true that charters have more “autonomy” than public schools. THIS charter school has outsourced every single decision to a management company. A public school principal who puts together an actual budget is much more in charge than the charter school is in this case.
Ed reformers complain that labor unions set teacher compensation. A for profit management company setting salaries is an improvement? Why?
Contracts and layers of opaque contracts, and the result is the public is on the hook for a lot of money that they have little to no control over. All of this reckless policy has resulted in Pennsylvania’s credit being downgraded by S&P.https://www.reuters.com/article/us-pennsylvania-budget/sp-downgrades-pennsylvania-credit-to-a-plus-cites-budget-problems-idUSKCN1BV2FS
” Why Did This Charter School CEO Pay Himself $11 Million”
OOO! my hand is up! Choose me! I know!
He took 25% of revenues for himself alone. That is quite shocking.
The better question, here, is “Why not?”
As the song title says, Nice Work if You can Get it.
[…] Inquirer and then Diane Ravitch and the Washington Post all reported on an audit which found that Gureghian was paying himself $11 […]