Archives for category: Fraud

Almost 90% of American students attend public schools, subject to democratic control. 6% of American students are enrolled in privately managed charter schools. Under the leadership of Betsy DeVos, it is obvious that the promotion of both charters and vouchers is central to the education policy of the Trump administration.

Two Democratic senators who are candidates for president, Bernie Sanders and Elizabeth Warren, have released education plans that recommend an end to federal support for charter schools (currently $440 million), which DeVos has handed out to corporate charter chains like IDEA and KIPP.

Senator Cory Booker, having equivocated during the campaign about his previous zealous support for charters, vouchers, and Betsy DeVos, surprisingly reversed course and wrote an article in the New York Times, once again stating his support for charters.

Since Senator Booker is polling at less than 2% in the primaries, he may be looking past the election to restore his relationship with his funders, who love charter schools and were disappointed by his apparent defection from their cause.

Leonie Haimson writes here about Senator Booker’s curious use of the word “boogeyman” to belittle critics of charter schools.

She notes that reporters at the New York Times have also used that term to belittle charter critics. Then she googled and found that the same word has been used by charter defenders thousands of times.

Haimson points out that charters in NYC divert more than $2 billion each year from the public school system. That money might have been spent to meet crucial capital needs and to reduce class sizes.

Also, Senator Booker did not mention that the national NAACP passed a resolution in 2016 calling for a moratorium on charters.

There are many reasons to be critical of charters, including their diversion of funding from public schools, their private governance, their long and well-documented record of waste, fraud, and abuse.

To dismiss all criticism of charters as a fear of a boogeyman is cynical, to say the least, and serves only the interests of the charter industry.

 

 

A trio of activists on behalf of public schools wrote a blistering critique of the pending state takeover of the Houston Independent School District, based on the failure of ONE high school that has an unusually high proportion of students who are poor and have disabilities.

Zeph Capo is president of the Houston Federation of Teachers and Texas AFT, James Dixon is pastor of the Community of Faith Church in Houston and a vice president of the Houston Branch of the NAACP, and Hugo Mojica is president of LULAC Education Council #402.

They write:

Residents of this community are increasingly frustrated with the upheaval in the Houston Independent School District. As Houstonians who work directly with the educators, parents and students in the district, we don’t blame them. But something doesn’t add up in the state’s decision to take over HISD.

Houston schools have been on an improvement track for years — the district recently earned a B grade from the state — just two points away from an A. After years of struggle among legislators, administrators and educators to figure out how best to serve our kids, HISD should be celebrating our progress. But instead of cheering parents, educators and students, who came together and turned around the city’s schools, the state slapped our community in the face by announcing this punitive takeover of the entire district.

A byzantine Texas law enables the state to trigger a district takeover — all 283 Houston public schools — if just one school chronically underperforms. So instead of investing in that one school — Wheatley High School, in this case — and providing it the attention and resources it needs, Austin bureaucrats chose to scapegoat and punish the entire city. Given that Houston students just scored second in math and third in reading within their national peer group, HISD seems like it should be a model rather than a takeover target.

The writers might have also mentioned that Houston was the only city to win the Broad award for most improved urban district twice, an honor conferred by the Broad Foundation, which has the same worldview of disruption as the Texas State Board of Education and State Commissioner Mike Morath. Morath previously served on the Dallas board of education but he is not an educator. He is a software developer. He has no ideas about how to improve schools, nor has he ever improved a school.

The authors write:

This political power grab is the epitome of overreaching, but it also reflects an insidious, ongoing effort to deny black and brown communities the educational opportunities their kids deserve. It represents a classist, old-school view of public education that rewards the privileged few and ignores the difficult work that must be done to ensure schools are safe and welcoming and meet the needs of all kids, regardless of geography or demography.

What’s also incredibly disappointing is that this takeover comes on the heels of a democratic election, in which the community elected new school board members. If this untenable takeover proceeds, duly elected trustees won’t get a chance to take their seats, defying the will of the people and denying a voice for those elected to represent the needs of students.

Gov. Greg Abbott and Education Commissioner Mike Morath aren’t actually looking out for Houston’s kids. They want to privatize Texas’ largest school district through a charter scheme. If that happens, this plan will funnel money out of our traditional public schools and into for-profit alternatives. This recent election vote reflected the community’s mandate that Houston public schools continue to invest in evidence-based wraparound services, including health care, before- and after-school programs, and enhanced social and emotional services.

State officials would prefer to privatize rather than invest new resources in a major district that is facing challenges and doing well compared to other urban districts.

Yes, indeed, something stinks in Texas.

The state officials behind the takeover are vandals, disrupters, corrupters of democracy.

They should not be allowed to mess with the HISD.

 

If you want to understand what is happening in the Little Rock school District today, read Eric Blanc’s article. 

Eric Blanc has covered every one of the teachers’ strikes since the West Virginia strike in the spring of 2018. Now he is in Little Rock, where he interviewed teachers who went on strike yesterday to protest the State Board of Education’s heavy-handed control of the district and its decision to strip school employees of collective bargaining rights.

Teachers are outraged that the State Board of Education, which took control of the district in 2015, utterly failed to improve student outcomes, yet refuses to relinquish control to a democratically elected board. Teachers believe that the state wants to resegregate the district.

Blanc writes:

Little Rock teachers today are not demanding raises for themselves, but an end to the state’s push to resegregate schools, its takeover of their district, its decertification of their union, and its disrespect for school support staff. As second grade teacher Jenni White explains, “this is literally about standing up for our kids and not dividing our community…

The immediate roots of this week’s action go back to January 2015 when the Arkansas State Board of Education announced that it was taking over Little Rock’s schools due to low standardized test scores. By all accounts, the ensuing state takeover failed to accomplish its nominal goal of improving stability and educational opportunities for the town’s low-performing schools. Yet rather than return Little Rock School District to local control in 2020 as promised, the state board instead proposed in September of this year that it would continue to oversee so-called “F”-rated schools, those with the lowest test scores.

Since all but one of the “F” schools were in black and brown neighborhoods south of I-630, teachers and parents saw this an attempt to create a two-tier school system. “The plan was blatantly racist, it separated the haves and the have notes,” Jenni White told me.

In a dramatic protest on the evening of October 9, thousands of teachers, support staff, students, and community members congregated on the steps of Central High, where the Little Rock Nine had famously confronted the National Guard decades earlier. Teresa Knapp Gordon, president of the Little Rock Education Association (LREA), closed the rally with the following declaration: “Either we accept segregation, or we stand and fight.”

This public outpouring forced the state board to change tactics. At the next evening’s contentious Arkansas Board of Education meeting, it dropped the proposal to split Little Rock’s school district. But surprisingly, the board then immediately proceeded to cease recognition of the LREA as the educators’ representative, thereby scrapping the last remaining collective bargaining agreement for school workers in Arkansas. The decision was blatant retaliation against not only teachers but also Little Rock’s school support staff, who were in the midst of negotiating a pay raise.

Next, the board issued a draft “Memorandum of Understanding” explaining that instead of returning full local control to the school board set to be elected in November 2020, the state would appoint a parallel “advisory board” that could veto local decisions. The Memorandum also insists on closing up to eleven neighborhood schools — which would thereby accelerate privatization, since state law gives charters first access to any vacant school. Stacey McAdoo, a teacher at Central High, told Labor Notes, “they are trying to charterize the [district] like what happened in New Orleans and disenfranchise people and make a separate school system out of the areas that are primarily Black and Latino.”

As in so many other states across the country, this offensive against the labor movement, public education, and working-class communities of color is being directly funded by billionaires. And it’s not just any billionaires: Little Rock teachers and students are up against the Arkansas-based Waltons, founders of Walmart and the richest familyin America.

The Walton family: the Death Star of Public Education. The ingrates who graduated from Arkansas public schools but now want to destroy them and public schools everywhere. Rich and shameless.

 

A federal judge found Secretary of Education Betsy DeVos in contempt of court and fined her Department $100,000, which is less than a slap in the wrist. It won’t begin to cover the losses suffered by students who were hounded by the Department to repay fraudulent student loans for a fraudulent education at for-profit colleges. DeVos believes it is her duty to protect the fraudsters, not the students.

A federal judge on Thursday held Education Secretary Betsy DeVos in contempt for violating an order to stop collecting loan payments from former Corinthian Colleges students.

Magistrate Judge Sallie Kim of the U.S. District Court in San Francisco slapped the Education Department with a $100,000 fine for violating a preliminary injunction. Money from the fine will be used to compensate the 16,000 people harmed by the federal agency’s actions. Some former students of the defunct for-profit college had their paychecks garnished. Others had their tax refunds seized by the federal government.

“There is no question that the defendants violated the preliminary injunction. There is also no question that defendants’ violations harmed individual borrowers,” Kim wrote in her ruling Thursday. “Defendants have not provided evidence that they were unable to comply with the preliminary injunction, and the evidence shows only minimal efforts to comply.

Politico reports that the Trump administration is apologizing profusely for hounding students whose loans for attending the predatory (now closed) Corinthian Colleges should have been forgiven. The judge in the case had threatened to punish Betsy DeVos for violating her court order. This is a case of “accountability for thee, but not for me.”

MAKING THE CASE AGAINST CONTEMPT FINDING: The Trump administration, in a court filing on Tuesday night, outlined why the Education Department and DeVos shouldn’t be held in contempt or face fines for violating U.S. Magistrate Judge Sallie Kim’s May 2018 order to stop collecting the student loans of former Corinthian Colleges students.

— Justice Department attorneys wrote that the Education Department “has been working diligently and in good faith to correct the errors” that led to the agency collecting on the student loans of thousands of borrowers despite the order. Kim is now deciding whether to hold the department and DeVos in contempt and impose sanctions, including fines, against them.

— “Loan servicers made an error on a small # of loans,” DeVos tweeted last week. “We know & we’re fixing it.” She also accused Sen. Elizabeth Warren of lying about the issue.

— The Trump administration’s filing mostly strikes a conciliatory tone. The department said it appreciates the “gravity” of the situation and the effect it had on affected borrowers. The department also said it was committed to coming into full compliance with the court’s order and asked that any sanctions be “forward-looking” rather than punitive.

— The Education Department conceded, though, that it had been “negligent” in its oversight of student loan companies. The “errors at issue here were not the result of any willful or intentional conduct on the part of the Department, but, as the Court has recognized, gross negligence, including negligent oversight of the Department’s servicers,” attorneys for the department wrote.

— Education Department officials last week sent letters admonishing its loan servicers over the issue and moved to discipline two department officials.

 

Heather Vogeli of ProPublica reports on property tax documents of Trump properties and reports some troubling discrepancies.

The story begins:

Documents obtained by ProPublica show stark differences in how Donald Trump’s businesses reported some expenses, profits and occupancy figures for two Manhattan buildings, giving a lender different figures than they provided to New York City tax authorities. The discrepancies made the buildings appear more profitable to the lender — and less profitable to the officials who set the buildings’ property tax.

For instance, Trump told the lender that he took in twice as much rent from one building as he reported to tax authorities during the same year, 2017. He also gave conflicting occupancy figures for one of his signature skyscrapers, located at 40 Wall Street.

Lenders like to see a rising occupancy level as a sign of what they call “leasing momentum.” Sure enough, the company told a lender that 40 Wall Street had been 58.9% leased on Dec. 31, 2012, and then rose to 95% a few years later. The company told tax officials the building was 81% rented as of Jan. 5, 2013.

New York City’s property tax forms state that the person signing them “affirms the truth of the statements made” and that “false filings are subject to all applicable civil and criminal penalties.”

The punishments for lying to tax officials, or to lenders, can be significant, ranging from fines to criminal fraud charges. Two former Trump associates, Michael Cohen and Paul Manafort, are serving prison time for offenses that include falsifying tax and bank records, some of them related to real estate.

This explains why Trump is so determined to hide his tax returns and is marshaling the resources of the Justice Department to conceal his business affairs. This may be the first time in history that the Justice Department shielded potentially criminal behavior.

 

 

Will Huntsberry of the Voice of San Diego has covered the scandals blighting California’s Charter Industry, especially the A3 online scandal, the largest in American history.

In this article, he goes straight to the heart of the scandals: the flawed audit process.

California lawmakers created a system that places just one process at the forefront of detecting fraud and mismanagement in the state’s schools: a yearly audit, conducted by a “state-approved,” “independent” auditor, according to the Department of Education.

But these auditors are not independent, in so much as they are hired and fired at will by the schools they are auditing. The term state-approved is also something of a misnomer. To qualify as an approved firm, the State Controller’s Office must only verify that the potential auditors are accountants in good standing with the California Board of Accountancy.

No special training or vetting required.

The audits themselves are also not designed to dig deeply into a school’s finances, according to transcripts from a grand jury proceeding into an alleged $80 million charter scam obtained by Voice of San Diego.

A3 Education operated 19 online charter schools around the state. The schools enrolled thousands of students, some real and some fake, prosecutors say. Two men at the top of the alleged scheme funneled $80 million out of the public education system and into companies they controlled, prosecutors say.

Even though few other people ever existed on the companies’ payrolls besides the owners, auditors following standard procedures missed that part of the alleged scam, as well as others, according to the grand jury transcripts.

“They’re not designed to catch fraud at all,” Michael Fine, who runs a state fiscal watchdog agency called the Fiscal Crisis Management and Assistance Team, told Voice of San Diego. “To have a certain confidence level in the numbers, they do some testing of transactions. But that testing is fairly limited.”

Fine said there’s another critical element that could limit the auditors’ effectiveness: They rely on what school management teams show them, rather than getting much behind the numbers.

That makes no sense. Ask the folks in charge of a massive scam to show you the numbers they choose to show.

California and charter fraud are becoming synonymous.

 

Jan Resseger is a profound thinker and a clear writer. I love reading what she writes. Jan is one of the Resistance leaders in my new book SLAYING GOLIATH: THE PASSIONATE RESISTANCE TO PRIVATIZATION AND THE FIGHT TO SAVE AMERICA’S PUBLIC SCHOOLS.

In this post, she explains to Democratic candidates why they should not waffle in their support for public schools.

Her explanation is a rallying cry for educators and parents. Print it out and pin it on the bulletin board next to your computer or tape it to your filing cabinet. Read it over and think about it.

She writes:

Here are my seven reasons for believing Democrats running for President ought to express strong support for public schools and opposition to charter schools:

First:   The scale of the provision of K-12 education across our nation can best be achieved by the systemic, public provision of schools.  Rewarding social entrepreneurship in the startup of one charter school at a time cannot possibly serve the needs of the mass of our children and adolescents. In a new, September 2019 enrollment summary, the National Center for Education Statistics reports: “Between around 2000 and 2016, traditional public school, public charter school, and homeschool enrollment increased, while private school enrollment decreased… Traditional public school enrollment increased to 47.3 million (1 percent increase), charter school enrollment grew to 3.0 million students (from 0.4 million), and the number of homeschooled students nearly doubled to 1.7 million. Private school enrollment fell 4 percent, to 5.8 million students.”

Second:   Public schools are our society’s most important civic institution. Public schools are not perfect, but they are the optimal way for our very complex society to balance the needs of each particular child and family with a system that secures the rights and addresses the needs of all children. Because public schools are responsible to the public, it is possible through elected school boards, open meetings, transparent record keeping and redress through the courts to ensure that traditional public schools provide access for all children. While our society has not fully realized justice for every child in the public schools, it is by striving systemically to improve access and opportunity in the public schools that we have the best chance of securing the rights of all children.

Third:   Charter schools are parasites sucking essential dollars from the public school districts where they are located. The political economist Gordon Lafer explains that the expansion of charter schools cannot possibly be revenue neutral for the host school district losing students to charter schools: “To the casual observer, it may not be obvious why charter schools should create any net costs at all for their home districts. To grasp why they do, it is necessary to understand the structural differences between the challenge of operating a single school—or even a local chain of schools—and that of a district-wide system operating tens or hundreds of schools and charged with the legal responsibility to serve all students in the community.  When a new charter school opens, it typically fills its classrooms by drawing students away from existing schools in the district…  If, for instance, a given school loses five percent of its student body—and that loss is spread across multiple grade levels, the school may be unable to lay off even a single teacher… Plus, the costs of maintaining school buildings cannot be reduced…. Unless the enrollment falloff is so steep as to force school closures, the expense of heating and cooling schools, running cafeterias, maintaining digital and wireless technologies, and paving parking lots—all of this is unchanged by modest declines in enrollment. In addition, both individual schools and school districts bear significant administrative responsibilities that cannot be cut in response to falling enrollment. These include planning bus routes and operating transportation systems; developing and auditing budgets; managing teacher training and employee benefits; applying for grants and certifying compliance with federal and state regulations; and the everyday work of principals, librarians and guidance counselors.” “If a school district anywhere in the country—in the absence of charter schools—announced that it wanted to create a second system-within-a-system, with a new set of schools whose number, size, specialization, budget, and geographic locations would not be coordinated with the existing school system, we would regard this as the poster child of government inefficiency and a waste of tax dollars. But this is indeed how the charter school system functions.”

Fourth:   While some predicted the expansion of charter schools would improve academic achievement on a broad scale, children in traditional public schools and charter schools perform about the same.  According to the new report from the National Center for Education Statistics, “Academic Performance: In 2017, at grades 4 and 8, no measurable differences in average reading and mathematics scores on the National Assessment of Educational Progress (NAEP) were observed between students in traditional public and public charter schools.”

Fifth:   Opposing for-profit charter schools misses the point.  In most states, charter schools themselves must be nonprofits, but the nonprofit boards of directors of these schools may hire a for-profit management company to operate the school. Two of the most notorious examples of the ripoffs of tax dollars in nonprofit (managed-for-profit) charter schools were in my state, Ohio. The late David Brennan, the father of Ohio charter schools, set up sweeps contracts with the nonprofit schools managed by his for-profit White Hat Management Company.  The boards of these schools—frequently people with ties to Brennan and his operations—turned over to White Hat Management more than 90 percent of the dollars awarded by the state to the nonprofit charters. These were secret deals. Neither the public nor the members of the nonprofit charter school boards of directors could know how the money was spent; nor did they know how much profit Brennan’s for-profit raked off the top. Then there was Bill Lager, the founder of Ohio’s infamous Electronic Classroom of Tomorrow—technically a nonprofit.  All management of the online charter school and the design and provision of its curriculum were turned over to Lager’s privately owned, for-profit companies—Altair Management and IQ Innovations. ECOT was shut down in 2018 for charging the state for thousands of students who were not really enrolled. The state of Ohio is still in court trying to recover even a tiny percentage of Lager’s lavish profits.

Sixth:   Malfeasance, corruption, and poor performance plague charter schools across the states. Because charter schools were established by state law across the 45 states where charters operate, and because much of the state charter school enabling legislation featured innovation and experimentation and neglected oversight, the scandals fill local newspapers. The Network for Public Education tracks the myriad examples of outrageous fraud and mismanagement by charter schools.  Because neoliberal ideologues and the entrepreneurs in the for-profit charter management companies regularly donate generously to the political coffers of state legislators—the very people responsible for passing laws to regulate this out-of-control sector, adequate oversight has proven impossible.

Seventh:   The federal Charter Schools Program should be shut down immediately. Here is a brief review of the Network for Public Education’s findings in last spring’s Asleep at the Wheel report.  A series of federal administrations—Clinton, Bush, Obama, and Trump have treated the federal Charter Schools Program (part of the Office of Innovation and Improvement in the U.S. Department of Education) as a kind of venture capital fund created and administered to stimulate social entrepreneurship—by individuals or big nonprofits or huge for-profits—as a substitute for public operation of the public schools. Since the program’s inception in 1994, the federal Charter Schools Program (CSP) has awarded $4 billion in federal tax dollars to start up or expand charter schools across 44 states and the District of Columbia, and has provided some of the funding for 40 percent of all the charter schools across the country. The CSP has lacked oversight since the beginning, and during the Obama and Trump administrations—when the Department of Education’s own Office of Inspector General released a series of scathing critiques of the program—grants have been made based on the application alone with little attempt by officials in the Department of Education to verify the information provided by applicants. The Network for Public Education found that the CSP has spent over a $1 billion on schools that never opened or were opened and subsequently shut down: “The CSP’s own analysis from 2006-2014 of its direct and state pass-through funded programs found that nearly one out of three awardees were not currently in operation by the end of 2015.”

Last June in The American Prospect, Robert Kuttner defined the political philosophy known as neoliberalism and showed how this kind of thinking has driven privatization across many sectors previously operated, for the public good, by government: “Since the late 1970s. we’ve had a grand experiment to test the claim that free markets really do work best… (I)n the 1970s, libertarian economic theory got another turn at bat…  Neoliberalism’s premise is that free markets can regulate themselves; that government is inherently incompetent, captive to special interests, and an intrusion on the efficiency of the market; that in distributive terms, market outcomes are basically deserved; and that redistribution creates perverse incentives by punishing the economy’s winners and rewarding its losers. So government should get out of the market’s way.”

For three decades, neoliberalism has reigned in education policy. The introduction of the neoliberal ideal of competition—supposedly to drive school improvement—through vouchers for private school tuition and in the expansion of charter schools has become acceptable to members of both political parties.

The late political philosopher Benjamin Barber explains elegantly and precisely what is wrong with neoliberal thinking in general. I think his words apply directly to what has been happening as charter schools have been expanded to more and more states. The candidates running for President who prefer to waffle on the advisability of school privatization via charter schools ought to consider Barber’s analysis:

“Privatization is a kind of reverse social contract: it dissolves the bonds that tie us together into free communities and democratic republics. It puts us back in the state of nature where we possess a natural right to get whatever we can on our own, but at the same time lose any real ability to secure that to which we have a right. Private choices rest on individual power… personal skills… and personal luck.  Public choices rest on civic rights and common responsibilities, and presume equal rights for all.  Public liberty is what the power of common endeavor establishes, and hence presupposes that we have constituted ourselves as public citizens by opting into the social contract. With privatization, we are seduced back into the state of nature by the lure of private liberty and particular interest; but what we experience in the end is an environment in which the strong dominate the weak… the very dilemma which the original social contract was intended to address.” (Consumed, pp. 143-144)

 

John Cassidy of The New Yorker wrote about the indictment and arrest of two men who were leaving the country with one-way tickets. Photographs of these men have been published showing them having a meeting at the White House with Trump and on another occasion, dining with Rudy G. at a Trump hotel and also a photo of them with Don Jr.

Cassidy writes:

What’s the most arresting detail that’s been unearthed so far in the unfolding scandal of Rudy Giuliani and the Ukrainian grifters? The more you delve into the story, the more it reads like something Elmore Leonard and Carl Hiaasen cobbled together after a guys’ getaway to Kiev. To make the selection a bit easier, let’s make it a multiple-choice question:

(a) Igor Fruman and Lev Parnas, whom the Wall Street Journalpolitely describes as “Florida businessmen who are U.S. citizens born in former Soviet republics,” were both carrying one-way tickets out of the country when federal agents arrested them at Dulles International Airport, on Wednesday night, and charged them with breaking campaign-finance laws by disguising donations from foreign entities.

(b) Parnas, a forty-seven-year-old native of Ukraine who arrived in the United States in 1976, owns a company called Fraud Guarantee. Evidently, it’s some sort of fraud-prevention advisory service. According to the Times, this company paid Giuliani hundreds of thousands of dollars for “business and legal advice.”

(c) According to Buzzfeed News, Parnas has in the past “worked for three stockbrokerages that were later expelled by regulators for fraud and other violations—though he was never individually charged—and racked up nine court judgments for failing to pay loans and other debts.”

(d) Parnas once tried to produce a movie called “Anatomy of an Assassin.” It didn’t go well. “Mr. Parnas is a con man, he is a crook,” Dianne Pues, a New Jersey woman who invested in the project, toldthe Miami Herald. “He conned us from day one. . . . He financially ruined us.”

(e) As he travelled around doing whatever he did, Parnas didn’t stint on expenses. “There were bills running to hundreds of dollars at exclusive restaurants such as Novikov in London and BLT Prime in Washington,” Buzzfeed reported. “During one of his many trips to the Ukrainian capital of Kyiv, there was a $657 charge at Tootsie, the popular strip club in the heart of the city.”

(f) Fruman, a fifty-three-year-old native of Belarus, apparently runs an import-export business that ships goods to and from Ukraine. He also reportedly owned, or owns, a beach club in the Black Sea city of Odessa, which has long been a stronghold of organized crime. The name of the club: Mafia Rave.

(g) In the spring of last year, after the dynamic duo donated three hundred and twenty-five thousand dollars to America First Action, a super pac that supports Donald Trump, they were invited to the White House, where they had dinner with the President and got their pictures taken with him. “Thank you President Trump !!! Making America great !!!!!! incredible dinner and even better conversation,” Parnas posted on his Facebook account.

(h) On Thursday, Trump said, “I don’t know those gentlemen.”

As I said, it’s a tough choice. On human-interest grounds, I’m choosing Option D, but the grip-and-grin picture of Parnas and Trump at the White House is also priceless—as is a picture of him having coffee with at Giuliani the Trump International Hotel in Washington last month. And let’s not forget the shot of Fruman and Parnas having breakfast in Beverly Hills last year with Donald Trump, Jr., and Tommy Hicks, Jr., a friend of Trump, Jr., who was then running America First Action.

But humor and Schadenfreude aside, this is a deadly serious matter. While there is still a good deal of murk surrounding the activities of Fruman and Parnas, we do know that they were two very busy and well-connected fellows. In addition to doing some of Giuliani’s bidding in Ukraine, as he sought to dig up dirt on Joe Biden and his son Hunter, Parnas got hired by a law firm run by two other Trump supporters and frequent Fox News guests, Joe DiGenova and Victoria Toensing. According to the Wall Street Journal, the law firm “hired Mr. Parnas in July to serve as an interpreter related to their representation of Dmitry Firtash, a Ukrainian oligarch, who was detained in Vienna, in 2014, on corruption charges filed in the U.S.”

Meanwhile, Parnas and Fruman were also representing, and acting at the behest of, at least two Eastern European parties who haven’t yet been identified. The indictmentsays that their political donations, some of which were routed through shell companies to hide their identities, “were made for the purpose of gaining influence with politicians so as to advance their own personal financial interests and the political interests of Ukrainian government officials, including at least one Ukrainian government official with whom they were working.”

Who was this Ukrainian official, and what did he or she want? That’s one of the things we don’t know yet, but the indictment says that Parnas met with a U.S. congressman, widely believed to be the former Texas Republican congressman Pete Sessions, and sought his “assistance in causing the U.S. Government to remove or recall the then-U.S. ambassador to Ukraine”—Marie Yovanovitch—and these “efforts to remove the Ambassador were conducted, at least in part, at the request of one or more Ukrainian government officials.”

We also know that the other Eastern European who was employing Parnas and Fruman is Russian. The indictment says that some of the donations that Fruman, Parnas, and two other individuals made in 2018 were really funded by a certain “Foreign National-1,” with a view to obtaining licenses for a recreational-marijuana business in certain U.S. states, including Nevada. One of the other conspirators is quoted in the indictment, and he says Foreign National-1’s identity was kept hidden because of “his Russian roots and current political paranoia about it.”

What does all this add up to? Although Parnas and Fruman hardly appear to fit the bill of men of international intrigue, they clearly played significant roles in the Giuliani-inspired effort to pressure the Ukrainian government to investigate the Bidens, get rid of Yovanovitch, and help Donald Trump get reëlected. That means they are potentially important witnesses in the Presidential-impeachment inquiry.

The House Democrats who are investigating Trump will most certainly want to hear what Parnas and Fruman have to say. (At least one House committee has already served a subpoena on them.) And, according to ABC News, the U.S. Attorney’s Office for the Southern District of New York, which brought the campaign-finance case against Parnas and Fruman, is also investigating their business relationship with Giuliani. That’s not good news for Rudy or Trump.

On Thursday, a federal judge in Virginia ordered the pair to be held in detention until they secure a bail bond of a million dollars each. Right now, they are being represented by John Dowd, a former lawyer for Trump, which would suggest they aren’t about to turn on their former associates and spill. But, like Michael Cohen, they could always have a change of heart.

  • John Cassidy has been a staff writer at The New Yorker since 1995.

 

Hedge fund managers decided in 2005 that the best way to advance the charter school idea was to create a faux organization called Democrats for Education Reform (DFER), then to funnel campaign cash to Democratic candidates who promised to support charter schools. This worked for a time. Senator Barack Obama spoke at the inaugural meeting of DFER at a penthouse in Manhattan filled with Wall Street types. When Obama was elected, DFER recommended Arne Duncan to be Secretary of Education, and Obama picked him over the highly qualified Linda Darling-Hammond, who had been his spokesperson during the campaign.

But some Democrats realized that DFER was a wolf in sheep’s clothing. The Democratic Party of California passed a resolution demanding that DFER drop the D because it was a front for corporate interests. The Democratic party of Colorado also passed a resolution denouncing DFER.

In 2016, DFER supported a referendum in Massachusetts to expand the number of charter schools, in company with the Waltons and big Republican donors. The charter campaign went down to a crashing defeat, after charters were denounced by the state Democratic Party and almost every school district committee in the state. The only demographic that supported the expansion of charters was members of the Republican Party.

Today, the loudest champion of charter schools is Betsy DeVos. The biggest allies of the charter movement are Republican governors and legislatures.

Sensing the change in the air, recognizing that charter schools now belong to ALEC and DeVos, almost every  Democratic candidate for President has steered clear of charter schools. Bernie Sanders endorsed the NAACP call for a moratorium on new charters.

But wait! DFER has commissioned a poll to demonstrate that Democrats actually favor charters!

Peter Greene says the poll is baloney. He explains it here. His advice: Ignore it.