Archives for category: Fraud

 

The California Legislature is considering four bills to reform the state’s massive charter school industry (1,300 schools, mostly unregulated and unsupervised). One of the bills would prohibit school districts from authorizing charters in other districts. The following story is a classic example of rural school districts authorizing online charters in San Diego and Los Angeles, solely to get the commission attached to each student. In this case, the online charters were cash cows for their owners. [A personal aside: Last February, I was in Newport Beach, California, having breakfast at a hotel. The man at the next table was loudly discussing his schools with someone who was selling athletic services, $5 a student. When he got up to leave, I asked him if he was “in the charter school business.” He said, “Yes,” and said he owned 40 schools under six different corporate names. I asked him his name. He said, “Sean McManus.” I should have asked him to join us. He is one of the key figures in the following article.]

The San Diego Union-Tribune reports that eleven people connected to online charter schools have been indicted for “criminal charges of conspiracy, personal use of public money without legal authority, grand theft and financial conflict of interest.“

The online charters operate in San Diego and Los Angeles, but were authorized by other districts that get a slice of the revenues. This is one of the corrupt practices that have been rampant in California, where lax state law allows sharp operators to get public money and cheat students with no consequences. The Legislature is currently debating a proposal to stop allowing District A to authorize a charter in District B, a practice that is mercenary and predatory. Until now, the powerful California Charter Schools Association—enriched by billionaires like Reed Hastings and Eli Broad—has fought all accountability for charter schools.

At the center of the allegations are leaders of the charter school management corporation A3 Education, a Newport Beach corporation whose leaders control 13 charter schools across California, according to an indictment filed May 17.

A3’s chairman, Sean McManus, and president, Jason Schrock, essentially owned and operated the charter schools throughout California at the same time that A3 contracted with those schools, according to the indictment.

McManus and Schrock operated multiple businesses that charged their own charter schools millions of dollars for services. Then they channeled money from those businesses into their own charitable trust and personal bank accounts, according to the indictment.

A3 Education and the businesses affiliated with McManus and Schrock together have invoiced at least $83.3 million from the 13 charter schools, according to the indictment.

From the affiliated businesses, at least $8.18 million went into personal bank accounts, some in Australia, and into charitable trust accounts for McManus, Schrock and their wives, and $500,000 went to a family member of McManus, according to the indictment.

McManus and Schrock also used $1.6 million of A3 Education’s funds to buy a private residence for McManus in San Juan Capistrano, the indictment states.

Also according to the indictment, six people, including McManus and Schrock, conspired to collect state money for students who were listed as being enrolled in Valiant Charter Schools but were not receiving services.

The two Valiant schools will close permanently on June 30. Several thousand students will need to find new schools. The San Diego online charter was authorized by the Dehesa School District, and the one in Los Angeles was authorized by the Acton-Agua Dulce Unified School District.

The children were not assigned to teachers who have state-required professional certificates, the indictment said. The students were not in contact with the schools or provided with educational services during the summer months, as some of the co-conspirators claimed, according to the indictment…

Also indicted is Nancy Hauer, who is superintendent of Dehesa School District, which authorized several charter schools, including Valiant Academy of Southern California. The Dehesa district office did not immediately provide a comment Tuesday.

Also among the indicted is Steve Van Zant, a former Mountain Empire Unified superintendent who three years ago pleaded guilty to violating conflict-of-interest laws, after he brokered deals with charter schools to operate in other school districts, prosecutors said at the time.

Valiant Academy had 43 students two years ago, 726 last year, and 2,250 this year. It’s academic performance was so poor that even the California Charter School Association recommended that it be closed.

Betsy DeVos says that parents always know what’s best. Why were they enrolling their children in these failing “schools.”?

 

 

 

 

Vielka McFarlane, founder of the Celerity charter chain in Los Angeles, was sentenced to 30 months in prison for misappropriation of $3.2 million from the schools’ accounts. 

In January, Vielka McFarlane pleaded guilty to one count of conspiracy to misappropriate and embezzle funds for personal use. McFarlane, 56, had for years used her charter schools’ credit card and spent taxpayer money on expensive clothing, luxury hotel stays and first-class flights. The bulk of the money spent was for the purchase and renovation of an office building in Columbus, Ohio, where McFarlane intended to open another charter school.

McFarlane was also ordered to pay restitution of $225,138.15 within 60 days.

The case dates to 2012. A routine request for Celerity’s financial records from L.A. Unified’s charter schools division revealed credit card statements of lavish purchases beginning in 2009 — five years after McFarlane had founded the first charter school. The school district’s inspector general opened an investigation and eventually, the federal government got involved.

Her conviction and sentencing raise the question of why Ben Chavis, founder and operator of the American Indian Model Charter Schools in Oakland, had all charges dismissed a few weeks ago after a state audit found that he had redirected $3.8 million of the schools’ funds to his personal accounts and that he used federal charter funds to pay the lease for the charters, which were located in buildings he owned. Are there any investigative reporters tracking this story?

 

Jeannie Kaplan was twice elected to the school board in Denver. She has long been active in civil rights and education issues. She has been a persistent and vocal critic of school closings, choice, and boasting about paltry gains in test scores. She was ignored by the “Reformers” like Michael Bennett and Tom Boasberg. As “Reform” money poured into Denver elections, the grassroots candidates she favored were defeated time and again, and Denver’s school board became unanimous for disruption.

When she recently read a blunt admission by her fellow Coloradan Van Schoales that “reform as we know it, is over,” she was astonished, outraged, and not amused.

Here is her response.

She summarized it in the title of her post: “OMG, ICYMI, SMDH.”

For a translation, open the link.

She begins:

Soooooo…it appears   “The education reform movement as we have known it is over.”  This from none other than “education reformer” extraordinaire, Van Schoales,  writing in the May 6, 2019 Education Week: Education Reform as We Know It Is Over.  What Have We Learned? Along his way to becoming the president of Colorado’s own reform-oriented “oversight” committee, A+ Colorado , Van has worked at Denver’s Piton Foundation and Education Reform Now (ERN), the advocacy arm of Democrats for Education Reform (DFER).  He has also been integrally involved with starting and supporting local charter schools and drafting statewide education reform-oriented legislation. When Denver media has needed a quote to support “education reform” outcomes, whom have they called?  Not Ghost Busters!  No, their go-to guy has been Van Schoales. So his partial about face in his recent post in Education Week is quite surprising.  In his words:

 “There are three primary reasons that education reforms failed to live up to our expectations: too few teacher-led reforms, a lack of real community support from those most impacted, and a lack of focus on policy change for public schools across the board, not just the lowest of low-performing schools.” 

Gee.  Who knew?

If I weren’t so darn mad, I’d be shedding tears of laughter.  If we hadn’t fought and fought and fought against “education reform” for the last 15 years, foretelling the recent conclusions of ed reformers,” the whole education reform movement could be viewed as a bad joke.  If we the taxpayers hadn’t spent hundreds of millions of dollars and if we the people hadn’t lost at least a generation of students and teachers to the chaos and churn and complete lack of common sense of “education reform,” we could all be lifting a glass of whatever to toasting “we told you so.”  If only the past 15 years could have been a bad dream, and we could all be like Dorothy and wake up in our safe places, wiping out the nightmare. But alas, that is not the case. And even with these mea culpas coming from unexpected places, most reformers are still unwilling to fully accept the disasters they have wrought upon community after community, most of which just happen to be populated primarily by people of color.

Sue M. Legg is a scholar at the University of Florida, a leader in Florida’s League of Women Voters, and a new board member of the Network for Public Education. She has written an incisive and devastating critique of Jeb Bush’s education program in Florida, which began twenty years ago. Bush called it his A+ Plan, but by her careful analysis, it rates an F. Advocates of school choice tout Florida’s fourth-grade scores on NAEP, which are artificially inflated by holding back third graders who dontpass the state test. By eighth grade, Florida’s students rank no better than the national average. Note to “Reformers”: a state that ranks “average” is NOT a national model.

Twenty Years Later, Jeb Bush’s A+ Plan Fails Florida’s Students. 

Sue Legg explodes the myth of the Florida miracle in her well documented report:  Twenty Years Later: Jeb Bush’s A+ Plan Fails Florida’s Students. She has compiled the research over twenty years showing the negative impact of privatization in Florida.  The highly touted achievement gains of retained third graders are lost by eighth grade.  Top ranked fourth grade NAEP scores fall to the national average by eighth grade. One half of twelfth graders read below grade level.  The graduation rate is above only 14 states.

The A+ Plan was a great slogan, but its defects resulted in a twenty-year cycle of trial and error to fix the problems.   School grades are unreliable.  A school receiving a ‘B’ grade one year has about a thirty percent chance of retaining the grade the following year. Invalid grades occur so frequently that State Impact reports that Florida made sixteen changes to the school grade formula since 2010.  It was thrown out but the new version is no more stable.  What it means to be a failing school, moreover, is consistently redefined to make more opportunity for charter school takeovers.  

Florida touts improving academic achievement in the private sector that is not supported by research.  The CREDO Study reams Florida’s for-profit charter industry.  According to a Brookings Institution study, low quality private schools are on the rise, and the LeRoy Collins Institute’s 2017 study, Tough Choices, explains that there are twice as many severely segregated Florida schools (90% non-white students) than there were in 1994-5.  The legislature ignores the problem in part because key legislators have personal interest in charter and private schools.  “Florida suits him” said Roger Stone, recently indicted in the Mueller investigation.  The New York Times article: Stone Cold Loser: quoted Stone’s admiration for Florida when he said “…it was a sunny place for shady people”.  Miami Herald series “Cashing in on Kids” reported a list of questionable land deals and conflicts of interest by for-profit charter school management. The federal government began an investigation in 2014.  Last year a  charter management firm faced criminal charges, and Florida charters have the nation’s highest closure rate.

WalletHub reports that Florida is 47th of 50 states in working conditions for teachers.  As a result, the Florida Education Association projects 10,000 vacancies next fall. Teacher shortages are not only related to money, they are due to a deliberate attack on the profession in order to break teacher unions and impose a political ideology.  As Steve Denning in a Forbes magazine article explains: “The system” grinds forward, at ever increasing cost and declining efficiency, dispiriting students, teachers and schools alike”. The thinking, he says, is embedded in the No Child Left Behind (NCLB) and Race to the Top policies.   The A+ Plan is an extension of these policies that includes increased testing and rewards and punishments related to results.

Florida’s teachers are not allowed to strike.  Parents may have to.  The legislature recently approved small raises for teachers but expanded the unconstitutional voucher program.  The governor is not concerned; he appointed three new judges to the Florida Supreme Court.  In the May 3rd 2019 Senate session, Senator Tom Lee chastised his fellow Republicans.  He has supported charter schools for years, but said ‘the industry has not been honest with us...first they wanted PECO facility funds, then local millage; now they want a portion of local discretionary referendum funds.  He called the current supporters ‘ideologues who have drunk the kool-aid‘.

The full report is published on the NPE-Action website.

 

Former Milwaukee School Board President Michael Bonds was convicted of accepting bribes to help a Philadelphia charter school operator. 

As part of an agreement with prosecutors, Bonds, 60, pleaded guilty to two counts in federal court in Philadelphia. He faces up to 10 years in prison and a $500,000 fine at his sentencing, tentatively set for September, but which will depend on when he completes his pledged cooperation with an ongoing federal investigation…

Bonds served on the MPS board from 2007 until he abruptly resigned in July 2018, nine months before his term was to end. 

He was charged last month with conspiracy and violations of the Travel Act for taking kickbacks in return for votes beneficial to Universal Cos. between 2014 and 2016. Two unnamed Universal executives were implicated in the scheme but have not been charged.

Veteran Milwaukee journalist Alan Borsuk described the affair as “a scandal with few rivals in the recent history of Milwaukee education.”  He sums up the details.

Universal Academy. Universal came into Milwaukee riding some celebrity appeal — its founder, Kenny Gamble, was a soul music star — and a reputation for running some decent charter schools, some housing projects and other ventures in its home town, Philadelphia.

Universal also initially named a well-regarded Milwaukee educator as its local leader. Ronn Johnson had founded and led the YMCA Young Leaders Academy. But months before Universal opened, Johnson was charged with sexually assaulting several students years earlier. A few months later, he died in a fire at his home in Brown Deer. His death was ruled a suicide.

The president and CEO of Universal in Philadelphia, Rahim Islam, stepped in to oversee the Milwaukee operation and spent a lot of time in the city. According to the Philadelphia Inquirer, he is one of the main figures in the bribery scheme involving Bonds. 

At one point, Universal schools enrolled 1,000 students.

Perhaps because enrollment didn’t meet expectations and then started to fall, and perhaps because Universal was overextended with the large amount of MPS property it was using, Universal began to slide. Islam became unreachable (he had been glad to talk in early times). Leadership of the schools kept changing. It was clear Universal wasn’t investing in Milwaukee any further.

And things got worse. First two schools closed. Then, the third. It was done abruptly, leaving kids and staff in the lurch.

And now a former Board President is headed to jail. Very sad.

 

 

Florida is controlled by Swamp creatures who want to divert money from public schools and send it to charter schools and religious schools. Jeb Bush is the puppet master who has demanded strict accountability for public schools, minimal oversight of charter schools, and no accountability at all for religious schools.

In this article, Carol Burris—the executive director of the Network for Public Education—examines the charter school mess. Florida has about three million students. About 300,000 attend charter schools. Some members of the Legislature have direct conflicts of interest but nonetheless vote to shower favors and money on the state’s charters.

Burris reports that nearly half of the state’s charters operate for profit. Entrepreneurs have flocked to Florida to get the easy money.

Burris begins:

Schoolsforsale.com claims to be “the largest school brokers in the United States that you will need to call.” Its owner, Realtor David Mope, is a broker for private schools, online schools and preschools. He will also help you start your own virtual school by providing certified teachers, marketing expertise, and assistance in securing accreditation.

Mope is not a newcomer to the for-profit school world. He was the owner and CEO of Acclaim Academy, a military-style charter chain. Acclaim’s “cadets,” who were predominantly minority students from low-income homes, wore army fatigues and engaged in drills. The schools’ education director, Bill Orris, had previously led a charter school that was shut down after its management company abandoned it.

Warning signs of failure were there from the beginning. The chain aggressively attempted to open new schools in multiple districts before establishing a track record in its two existing schools. Most districts saw red flags, but two did not. In the fall of 2013, two more Acclaim schools were approved, bringing the total schools in the chain to four.

As school grades came in, unsurprisingly, the Acclaim Academy charter schools were rated “F.” In 2015, three closed their doors, leaving families in the lurch in a manner that parents described as chaos. Although Florida’s State Board of Education had allowed the schools to stay open to finish the school year, Mope filed for bankruptcy, sending students out on the street scrambling to enroll in another school with only a few weeks left in the school year. Vendors would never be paid. Parents helped teachers pack up. Nevertheless, Mope pretended the schools were solvent and continued to broker a deal to purchase hundreds of thousands of dollars of equipment.

How could Acclaim Academy ever open in the first place? Who would give this risky charter chain the seed money to get started? The American taxpayers did. A U.S. Department of Education Charter Schools Program (CSP) grant for $744,198 helped get the Acclaim Academies off the ground.

Acclaim Academy charter schools were among 502 Florida charter schools that received grants from the Department of Education between 2006 and 2014. All but two came from federal money given to the state for distribution. According to the CSP database, these Florida charter schools were awarded a total of nearly $92 million in federal funds between 2006 and 2014.

At least 184 (36.6 percent) of those schools are now closed, or never opened at all. These defunct charter schools received $34,781,736 in federal “seed” money alone.

 

Mercedes Schneider reports on her examination of Joe Biden’s brother Frank and his role in the charter industry in Florida. 

Let me begin by saying straight out that I don’t judge people by what their relatives do. I have seven brothers and sisters (five living) and I am not responsible for their decisions and activities, as they are not responsible for mine.

Having said that, I think the public needs to know where Joe Biden stands on charter schools such as the ones in which his brother was deeply involved, as we should know where every candidate stands on the privatization of education.

The facts that Schneider has assembled are vastly Important as they reflect on the shoddy oversight of for-profit charters in Florida. Forget the famous name involved. Read this fascinating account to see how children and taxpayers are being bilked by shady operators who know nothing about education. Lousy results have no impact on the bottom line.

An awful lot of people are cashing in on kids and on the infinite gullibility of the public and the cupidity and greed of politicians who enable these for-profit frauds.

 

Jan Resseger is a voice of moral clarity in a time of moral turpitude.she reflected on the NPE report “Asleep At the Wheel,” about the slipshod, failed federal program to pump money into the charter industry and concluded the program should be terminated, with the money transferred to high-needs schools. 

She writes:

“The Network for Public Education published its scathing report on the federal Charter Schools Program three weeks ago, but as time passes, I continue to reflect on its conclusions. The report, Asleep at the Wheel: How the Federal Charter Schools Program Recklessly Takes Taxpayers and Students for a Ride, is packed with details about failed or closed or never-opened charter schools.  The Network for Public Education depicts a program driven by neoliberal politicians hoping to spark innovation in a marketplace of unregulated startups underwritten by the federal government. The record of this 25 year federal program is dismal.

“Here is what the Network for Public Education’s report shows us. The federal Charter Schools Program (CSP) has awarded $4 billion federal tax dollars to start 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 that have been started across the country. Begun when Bill Clinton was President, this neoliberal—publicly funded, privatized—program has been supported by Democratic and Republican administrations alike.  It 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.  Hundreds of millions of dollars have been awarded to schools that never opened or that were shut down: “We found that it is likely that as many as one third of all charter schools receiving CSP grants never opened, or opened and shut down.”  Many grants went to schools that illegally discriminated in some way to choose their students and served far fewer disabled students and English language learners than the local pubic schools.  Many of the CSP-funded charter schools were plagued by conflicts of interest profiteering, and mismanagement. The Department of Education has never investigated the scathing critiques of the program by the Department’s Office of Inspector Genera; neither has the Department of Education investigated the oversight practices of the state-by-state departments of education, called State Education Agencies by CSP, to which many of the grants were made. Oversight has declined under the Department’s leadership by Betsy DeVos.

“One of the shocking findings in the Asleep at the Wheel report is that a series of federal administrations—Clinton, Bush, Obama, and Trump have treated this program 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. This use of the Charter Schools Program as a source for venture capital is especially shocking in the past decade under Presidents Obama and Trump, even as federal funding for essential public school programs has fallen. The Center on Budget and Policy priorities reports, for example, that public Title I formula funding dropped by 6.2 percent between 2008 and 2017.”

Betsy DeVos defended the high failure rate by saying that in the business world, some start-ups fail. Why is the federal government using education money to invest in start-ups? Why shouldn’t the federal government review the applications carefully before awarding millions of dollars? What bank will lend you money without carefully reviewing your proposal and financials? Since 1994, this program has been a giant cookie jar, filled with free money.

 

 

 

Peter Greene writes here about the open theft of public funds, transferred from public schools to to charter schools, in Florida. He raises a question that I have often wondered about: When did Republicans become the enemies of local control? The answer in Florida is obvious: when the money is there to pay the legislators to change their views, they change their views. It is not about improving education, since they are reducing the funds available to educate the vast majority of Florida’s children. This is a pay-to-play sellout of public education. When people vote to put thieves in office, they should not be surprised when the thieves rob them and their schools.

He writes:

“Imagine. You live on the 300 block of your city, and your neighborhood is starting to look kind of run down, mostly because the city has redirected a ton of your tax dollars to the neighborhood on the 400 block. You try to fight city hall, but that’s futile, so instead, you get the neighborhood together, and you collect money from amongst yourselves to upgrade sidewalks, clean the streets, refurbish the curbs, and just generally fix the place up. And then the city sends a message– “That money you just collected? You have to give some of it to the neighborhood in the 400 block.”

“Congratulations. You live in Florida.

“Florida’s elected Tallahassee-dwellers have pretty much dropped all pretense; under Governor Desantis, the goal is to completely demolish public education, with no more cover story than to insist that the resulting privatized system is still a “public school system.” I have seen better gaslighting from a fourteen year old saying, “I did not throw that pencil at Chris” even though he watched me watch him do it.

“The Tampa Bay Times offers some background:

“Let’s check the record. For years, Republicans who control the Legislature have attacked teacher unions as the enemy and complained about under-performing public schools while starving them of financial resources. They would not let local school districts keep additional tax revenue created by rising property values. They gave them little or no money for construction and renovation. And last year, they increased base spending per student by a grand total of 47 cents.

We’ll put Swampland Charter right here.

“Florida has been systematically starving its public school system, so some districts took the most logical step available to them– they levied taxes on themselves to raise teacher salaries, replace programs that were cut, and basically use their own local money to reverse the problems caused by state-level neglect. They stepped up to solve the problems the state caused.

“Last week, Florida GOP legislators pooped out a proposal to stop all this locally controlled self-reliant bootstrapping (because, you know, conservatives hate local control, self-reliance, and bootstraps, apparently, now). The bill, proposed by the House Ways and Means Committee led by Rep. Bryan Avila, R-Miami Springs, says those local districts must hand over some of those tax dollars to charter schools or the state will just cut their state funding even more.

“This is just nuts on so many levels. In addition to pissing on the conservative values of local control and self-reliance, this also thumbs its nose at one of the traditional arguments for charter schools– that competition will make public schools up their games. I’d call bullshit on that point, except that’s exactly what happened here– with their ability to compete hamstrung by Tallahassee tightwads, these local districts found a way to be competitive, including competing for teachers in the midst of Florida’s well-deserved and completely predictable teacher shortage.”

 

In this post on Valerie Strauss’s Answer Sheet blog at the Washington Post, Carol Burris and I respond to Betsy DeVos’s putdown of the Network for Public Education’s meticulous documentation of the failure of the federal Charter Schools Program. Our report, “Asleep at the Wheel,” showed that the U.S. Department of Education had handed out hundreds of millions of dollars–close to a billion dollars–between 2006 and 2014, to nearly 1,000 charter schools that never opened or that closed soon after opening. DeVos, as you will see, dismissed the report out of hand, and we assume that she never read it. The report was carefully documented, with references drawn mainly from government sources, including the website of the U.S. Department of Education. And for an added bonus, we show that 42% of all charter schools in DeVos’s home state of Michigan that received federal funding either never opened or closed soon after opening. What will she do to correct the lack of oversight in her own department?

We write:

Here is a link to 109 Michigan charter schools, called “academies,” that were awarded Charter School Program (CSP) grants from 2006-2014 but either never opened or closed. That number represents 42 percent of all recipients. Those highlighted in maroon shut down. Those highlighted in tan are schools that received funds but never opened. You will find ample documentation for your staff to review our work.

As anxious as you are to open new charter schools, if nearly half of them do not make it, we suggest that something is wrong with the selection process.

In total, $20,272,078 was awarded to defunct Michigan charter schools. And yet, in 2018 you awarded the State of Michigan an additional $47,222,222.

Your home state is not alone. Posted here is a similar list from the state of Ohio showing the names of 117 charter schools (40 percent) that received CSP funds between 2006-2014 that also never opened or are now closed. The total of CSP awards to those schools is $35,926,693. Please note that in all of these states, far more charter schools have failed than just those that received federal SEA funds. In the case of Ohio, the list of closed charters (293) is nearly equal to the number of schools that are presently open (310).

Dare I say that the U.S. Department was scammed because of its own negligence?

Read on.

There is more about Louisiana, California, and other states.

We are talking here about our taxpayer dollars. There are needy schools in the U.S. Yet the Department of Education squanders money on failed and failing charter schools. This must stop!