Archives for category: Fraud
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URGENT: Why NSA Contractor Leaked Top-Secret Evidence of Russian Interference in 2016 Election

By dianeravitch
June 6, 2017 //
47

A woman working for an NSA contractor heard a podcast by The Intercept in which Glenn Greenwald and others expressed skepticism about Russian hacking of the 2016 election.

According to news reports, she copied top-secret evidence and sent it to The Intercept to prove that Russians hacked into election software before the 2016 election.

“On March 22, The Intercept hosted a podcast online looking at, among other things, the public outcry over Russia’s alleged collusion with associates of President Donald Trump and the Kremlin’s alleged interference in last year’s presidential election.

“Host Jeremy Scahill said “there is a tremendous amount of hysterics” and “a lot of premature conclusions being drawn around all of this Russia stuff,” but “there’s not a lot of hard evidence to back it up.”

“Appearing as a guest on the podcast, Intercept reporter Glenn Greenwald agreed, saying that while “it’s very possible” Russia was behind election-related hacks last year, “we still haven’t seen any evidence for it.”

“Little more than a week later, Winner allegedly used a Gmail account to contact The Intercept, and she “appeared to request transcripts of a podcast,” court documents said.

“More than a month later, the NSA secretly issued the classified document now at the center of the leak case. And within days, Winner allegedly found it, printed it out and mailed it to The Intercept.”

In short, she sent The Intercept some concrete evidence of Russian hacking of our election.

We will be hearing more about this. If the Russian cyber-spies hacked into voting machines, Trump may be an illegitimate president. He may have lost both the popular vote and the electoral college.

Remember that Trump kept insisting it was “a rigged election.” Little did we know.

Categories Fraud, Trump

The Most Important Expose You Will Read Today: The Fringe Right Universe of “Charities”

By dianeravitch
June 4, 2017 //
15

The Washington Post published a deeply researched expose today about the “secret universe” of “charities” that fueled the election of Donald Trump.

Please understand before reading this that the Internal Revenue Service classifies organizations for tax purposes as 501(c)3 or 501(c)4. When Anthony Cody and I formed the Network for Public Education in 2013, we learned that we had to get IRS approval to raise money. Contributions to a (c)3 are tax-deductible. Contributions to a (c)4 are not tax-deductible. If we were a (c)3, we had to have broad charitable purposes and could not engage in any political or partisan activities, although we could lobby for legislation that met the purposes of the organization. To engage in political action or endorsements, we had to create a (c)4, with its own board. The (c)4 can be completely political, lobby for legislation, endorse candidates, but contributions are not tax-deductible. We hired a lawyer, followed the rules, and we often check with the lawyer to make sure we are always in compliance.

That is why we have two organizations. The Network for Public Education is a (c)3. Contributions are tax-deductible. It advocates for the improvement of public schools. It does not endorse candidates. We also created an organization called the Network for Public Education Action Fund, which is a (c)4. Contributions to it are not tax-deductible. It endorses candidates in states where we are allowed to do so, and endorses referenda.

As you read the article about the Shadow Universe, you will see references to foundations that are nakedly partisan. Yet, they are (c)4 tax shelters for the wealthy. They give only to rightwing causes that are unabashedly political, yet have (c)3 stats. You will see references to “charities” that are not charitable but political. They wage war against the left. They consider climate change a hoax. They think America’s universities are controlled by Communists. They think America is about to be taken over by “Islamofascists.” They want the federal government to spend billions on vouchers to remove children from public schools. When the IRS tried to crackdown on political organizations that masqueraded as charities, Republicans in Congress angrily denounced the IRS for going after conservative “charities,” and the IRS backed off. Now those “charities” have put Trump in the White House and captured the Republican Party.

So, one aspect of the article is the way the IRS code has been flagrantly ignored by rightwing activists, first, to shield family fortunes (like Bradley, Scaife, DeVos, Mercer, and many more) from taxation, but second, to enable rightwing political activists to raise tax-exempt contributions from the rich, who are always seeking ways to avoid paying for the government that protects them.

The article is also important because it exposes a little-known world of rightwing activism. It explains the origins of the ideologues on the fringe right who have seized control of the Republican Party.

You will understand Trump better if you read this article. His election represents the victory of a militant, angry, bitter group of extremists. They don’t give a hoot about working people. Trump is the point of the spear of a well-organized, well-financed powerful movement.

Categories Fraud, Hoax, Trump

William Mathis: Paradise Lost, Or, Trump’s Budget Cuts to Education

By dianeravitch
May 30, 2017 //
5

William Mathis explores the lies at the heart of Trump’s education budget.

He writes:

Trump’s Education Budget: A Paradise Lost?

“But all was false and hollow; though his tongue Dropp’d manna and could make the worse appear the better reason.”
■ John Milton, Paradise Lost, II.I.112

We had a vision of a more perfect nation where democracy and equality were more than aspirations. We believed we could make this piece of paradise real with the unity of the people and the purposefulness of our governments. But this has been reduced to an endless series of false and hollow incantations whose life-span is as transient as its denial in the next morning’s news cycle.

In 1965, the federal government, driven by the obligation to provide equal opportunities to the least fortunate of our citizens, passed the Elementary and Secondary Education Act. It was intended to lift the nation by strengthening our poorest children and schools, improving the quality of teaching, opening the doors of higher education, and providing skills to adults. It embraced the ideal voiced by the late President Kennedy that “a rising tide lifts all boats.” And the emphasis was on building the common good. By widely investing in our citizens, we invest in the health of our society and economy.

Those principles have found no refuge in the work of President Trump and Education Secretary DeVos; all that remains of these great purposes are a confusion of empty words made to appear as if the worst were the better. Larded with phrases like “commitment to improving education” and “maintaining support for the nation’s most vulnerable students,” Trump proposes to slash federal education programs by $9.2 billion dollars, or 13.5%. This is on top of past unmet needs, since federal obligations to poor and special education children have never been fully met. Starved programs are now set to have their rations reduced or cut entirely.

With a remarkable lack of compassion, the Special Olympics budget was zeroed. Twenty-two programs are eliminated including community learning centers, arts, pre-school and teacher improvement.

Blind to clear evidence, every dollar invested in high-quality early childhood education returns eight dollars in positive social outcomes such as reduced unemployment, stable families, less incarceration and the like. Yet the Trump budget treats this wise and productive investment as another area to defund: Head Start and childcare are slotted for small reductions, while preschool development grants are entirely eliminated.

It doesn’t get any easier for poor and middle-class students as they get older. Loan forgiveness programs for new college graduates working in schools or government would be eliminated. Student loan interest would be increased. In Trump’s plan, 300,000 students would lose their work-study jobs. In all, $143 billion would be removed over ten years.

Why make these cuts? The proposal calls for an increase in defense spending of more than $50 billion (a 10% increase) plus tax cuts for the wealthy – and that money has to come from somewhere. By these deeds, a capacity for war is valued more than the needs of the citizenry.

Yet, Trump says “education is the civil rights issue of our time.” This budget raises questions about whether his true objective is to cut civil rights. The proposal’s centerpiece is school choice. The budget seeks to funnel $1.4 billion, in new as well as repurposed funds, into private schools. The “civil rights” framing is stunning doubletalk, since a growing body of independent research shows that school choice segregates students by race, handicap and socioeconomic level.

While there are well-funded partisans who claim that school choice results in better education, an objective look at the data says otherwise. Four recent major studies have examined test-score outcomes for voucher students—in DC, Indiana, Ohio and Louisiana—and all four studies show these students doing worse than if they had stayed in public school. The results for charter schools don’t look good enough to justify the rhetoric. Charter schools and public schools perform about the same in terms of test-score outcomes, with poor schools and exceptional schools being distributed among both sectors. In short, school choice is not a way to increase achievement or equality.

At all levels, the the federal government’s long-standing commitment to tackling inequality is left behind. Instead the budget addresses these concerns by reducing services and by growing a competitive choice system that pits schools and families against each other. In this jarring half-light of contradictions, the worst is claimed to be the better.
The election promises still resonate. Manufacturing was to be restored, the little guy would be taken care of, and the dispossessed would have a champion to restore an imagined great Utopia. Instead, it is a coarsened, contradictory and conflicted selfishness, which lessens the common good. It promises manna but takes from the needy to give to the rich. It is far more dangerous than an education appropriation. Its values threaten our democratic society. Instead of a paradise regained, it is a paradise lost.

William J. Mathis is the Managing Director of the National Education Policy Center and vice-chair of The Vermont State Board of Education. The views expressed are those of the author and do not necessarily reflect the views of any group with which he is affiliated.​

Categories Budget Cuts, Fraud, Funding, Justice, Privatization, Supporting public schools, U.S. Department of Education

Oakland Charter School in Trouble Again

By dianeravitch
May 27, 2017 //
16

The American Indian Model School in Oakland has a checkered history.

It began as a school for American Indians. It was taken over by a swaggering, authoritarian leader named Ben Chavis. Chavis quietly got rid of the American Indians and replaced them with Asian and white students. The scores escalated, and the charter became famous and celebrated for its “no excuses” discipline and its high test scores.

Rise and Fall of California’s Most Celebrated Charter School

Governor Schwarzenegger visited the school, as did a parade of media luminaries. Chavis became a hero on the right, as he excoriated unions, multiculturalists, liberals, and anyone who questioned his harsh methods.

In a book called “Sweating the Small Stuff,” David Whitman cited AIMS as an exemplary charter school. Whitman’s book was published by the Thomas B. Fordham Institute. Whitman became Arne Duncan’s speech writer.

The ceiling fell in on Ben Chavis, leader of AIMS, when a state audit discovered that $3.8 million was missing from the school’s account–and had been deposited in Chavis’s personal and business accounts.

Chavis retired, but the school lives on.

Earlier this year, Chavis wS arrested and charged with fraud.

http://www.goodreads.com/author_blog_posts/14922402-ex-charter-school-leader-charged-with-fraud-money-laundering-what-woul

The latest news is that the school is in turmoil. Parents, teachers, and students are angry at the administration.

https://m.eastbayexpress.com/SevenDays/archives/2017/05/24/parents-teachers-and-students-at-oakland-charter-school-accuse-leadership-of-mismanagement

AIMS is listed by Jay Mathews as one of the best high schools in America, positioned as #11 on his list.

Categories Accountability, California, Charter Schools, Discipline, Education Industry, Fraud

Jeff Bryant: DeVos’s “Transformation”=Public Theft

By dianeravitch
May 26, 2017 //
8

Jeff Bryant has read Betsy DeVos’s speeches slamming public schools and extolling the virtues of public subsidy for private and religious schools. She carefully selects an anecdote to make her case. But she is late to the party. There is now persuasive evidence that students in voucher schools get worse results than their peers in public schools. In addition, many of those who use vouchers are students from affluent families who are happy to have the pyvlid foot the bill for their private school tuition.

Betsy is shilling for her extremist allies at ALEC.

“Declaring “the time has expired for ‘reform,’” she called instead for a “transformation… that will open up America’s closed and antiquated education system.” Her plan also opens your wallet to new moochers of taxpayer dollars.

“By the way, AFC, according to SourceWatch, is a “conservative 501(c)(4) dark money group that promotes the school privatization agenda via the American Legislative Exchange Council (ALEC) and other avenues.” It also grew out of a defunct PAC connected to DeVos called “All Children Matter” that ran afoul legally in Ohio and Wisconsin and still owes Ohio $5.3 million for breaking election laws.”

Bryant concludes:

“In her efforts to create the education transformation she calls for, DeVos is supremely eager to “get Washington and the federal bureaucracy out of the way,” but still wants you to pay the cost of privatizing our schools. That’s not an agenda for better schools. It’s about stealing public money.”

Categories Accountability, ALEC, Betsy DeVos, Corporate Reformers, Education Industry, Fraud, Hoax, Privatization, School Choice

Well, That Was Fast! Charter Founder in Los Angeles Charged with Fraud

By dianeravitch
May 21, 2017 //
40

The day after the election that handed control of the Los Angeles school board to charter promoters, the head of a now-closed Los Angeles charter school was charged with embezzling $200,000.

Kendra Okonkwo, 51, was charged with misappropriation of public funds, grand theft by embezzlement, money laundering and keeping a false account, according to a news release issued by the Los Angeles County district attorney’s office. Her son, 29-year-old Jason Okonkwo, is accused of approving fake invoices to further the plot and faces the same charges, prosecutors said.

Kendra Okonkwo founded the Wisdom Academy for Young Scientists near the Watts neighborhood in 2006, but the school quickly became a target of regulators and lost its charter in 2016. She and her son were arrested in Los Angeles on Thursday morning and remain jailed in lieu of $145,000 bail, according to Deputy Dist. Atty. Dana Aratani, who is prosecuting the case.

From January 2012 to March 2014, approximately $201,000 was transferred from the school to an unnamed business run by Okonkwo, according to the district attorney’s office. The money was then transferred to her personal bank account, prosecutors said.

That’s the downside of opening schools that receive public funds without transparency or accountability.

Categories Charter Schools, Fraud, Los Angeles, Privatization

Florida Charter Scandal: Legislators Vote Millions for Charter Schools Where They Earn a Profit

By dianeravitch
May 20, 2017 //
14

Fabiola Santiago has a stunning story in the Miami Herald about the deep corruption in the state’s charter industry.

Several key legislators are financially connected to charter schools.

He writes:

Florida’s broad ethics laws are a joke.

If they weren’t, they would protect Floridians from legislators who profit from the charter-school industry in private life and have been actively involved in pushing — and successfully passing — legislation to fund for-profit private schools at the expense of public education.

Some lawmakers earn a paycheck tied to charter schools.

One of them is Rep. Manny Diaz, the Hialeah Republican who collects a six-figure salary as chief operating officer of the charter Doral College and sits on the Education Committee and the K-12 Appropriations Subcommittee.

Some lawmakers have close relatives who are founders of charter schools.

One of them is the powerful House Speaker, Richard Corcoran, the Land O’Lakes Republican whose wife founded a charter school in Pasco County that stands to benefit from legislation. He was in Miami Wednesday preaching the gospel of charter schools as “building beautiful minds.”

Other lawmakers are founders themselves or have ties to foundations or business entities connected to charter schools.

One of them is Rep. Michael Bileca, the Miami Republican who chairs the House Education Committee and is listed as executive director of the foundation that funds True North Classical Academy, attended by the children of another legislator. Bileca is also a school founder.

These three legislators were chief architects in the passage of a $419 million education bill that takes away millions of dollars from public schools to expand the charter-school industry in Florida at taxpayer expense.

They crafted the most important parts of education bill HB 7069 in secret, acting in possible violation of the open government laws the Legislature is perennially seeking to weaken. There was no debate allowed and educators all across the state were left without a voice in the process.

It’s no wonder it all went down in the dark. It’s a clear conflict of interest for members of the Florida Legislature who have a stake in charter schools to vote to fund and expand them. Their votes weaken the competition: public schools.

This issue has nothing to do with being pro or against school choice. It’s about the abuse of power and possible violations of Florida statutes.

Read more here: http://www.miamiherald.com/news/local/news-columns-blogs/fabiola-santiago/article151418277.html#storylink=cpy

When people ask you how you can possibly be against charter schools, think of this story.

Categories Accountability, Charter Schools, Education Industry, Florida, For-Profit, Fraud, Privatization

California: Charter School Will Close Because of Founder’s Audacious Misuse of School Funds

By dianeravitch
May 14, 2017 //
8

The California State Board of Education accepted its staff recommendation and voted not to renew the Oxford Preparatory Academy charter school in Chino. The school will close June 30.

Parents defended the school, and one member of the board made a last-ditch plea for the school but he was outvoted.

“But board members grappled over the fate of the high-performing school that might be fatally encumbered with unknown debts accrued by its ousted founder, who is under investigation by district attorneys in two counties for alleged fraud.

“Did the school do wrong, or did an individual do wrong?” asked state school board member Bruce Holaday. “I’m still wrestling with that.

“Holaday offered a motion to approve the school’s appeal, but with a long list of new oversight requirements. The motion died, with a 4-6 vote. No other board members offered another motion, and 14 months after Chino Valley Unified staff first publicly raised questions about the financial health of the school, Oxford Preparatory Academy was out of options…”

“California Department of Education staff recommended that the state school board deny Oxford’s appeal, based on what Charter Schools Division Director Cindy S. Chan called “unrealistic” recovery plans.

“This audit report is horrific,” Chan said of a 2016 report from the state’s Fiscal Crisis and Management Assistance Team, made up of financial staff from districts across the state. The audit accused OPA founder Sue Roche of “laundering” money through Yorba Linda-based Edlighten Learning Solutions, a company she and her family ran.

“An open investigation by the San Bernardino County District Attorney’s Office also factored into the department’s recommendation to deny the appeal, Chan said.

“We are skeptical that any corrective action addressing all of the issues could be put in place” in time for the new school year, she said. “It looks like they’ve made efforts, but it’s just too short of a time.”

“Founded in 2010 by former Chino Valley Unified principal Roche, the school initially had a warm relationship with the district. Superintendent Wayne Joseph urged the school board to approve its initial charter and its first charter renewal request.

“That changed last year, when district officials expressed doubt about Roche setting up for-profit companies to provide services to OPA, using public school tax dollars for private profit.

“An audit commissioned by the school showed Edlighten still controls $900,000 in OPA funds, according to Joseph.

“In part, we included this list of items to follow up on, for law enforcement,” Michael Fine, chief administrative officer of FCMAT, told the state school board Thursday. “We don’t know that fraud has occurred. We believe there’s sufficient evidence that there may have been.”

“Among that evidence is a letter to the Internal Revenue Service, in which OPA reportedly characterized the company as being an integral part of the school. But two months later, to the district and FCMAT, OPA officials “disputed that they were one and the same and that (Edlighten) held assets,” Fine said.”

Categories Accountability, California, Charter Schools, Education Industry, For-Profit, Fraud, Privatization

Will the Trump-DeVos Alliance Win Control of Los Angeles Public Schools?

By dianeravitch
May 14, 2017 //
13

“In the Public Interest,” an organization that keeps track of privatization of the public sector, points out that Trump and DeVos have a lot riding on the outcome of the school board election in Los Angeles on May 16.

Their allies have invested millions of dollars in gaining control of the school board so they can turn students and schools over to private hands.

If they can defeat Steve Zimmer and Irma Padilla in run-offs, they will be able to divert public funding to charter entrepreneurs and corporate charter chains. They will squash democratic control of public schools. They will send tax dollars to corporate entities that are neither accountable nor transparent. They will widen the reach of an unregulated industry that has been marred by scandal, theft, fraud, misappropriation of funds, and self-dealing.

Citizens of Los Angeles. Stand up for democracy and public education! Vote for Steve Zimmer and Imelda Padilla!

Categories Accountability, Charter Schools, Corporate Reformers, Education Industry, Fraud, Los Angeles, Privatization

Center for Popular Democracy: Charter School Vulnerabilities to Waste, Fraud, and Abuse

By dianeravitch
May 13, 2017 //
8

Is it reasonable to give taxpayer dollars to entities that are deregulated and unsupervised? That are unaccountable and non transparent? What do you think will happen when government funds are turned over to organizations that are basically on their own and who make campaign contributions to legislator who prevent accountability for their donors?

The Center for Popular Democracy explains what you expect under these circumstances: waste, fraud, and abuse.

Here is the executive summary:

“In 2014, the Center for Popular Democracy (CPD) issued a report demonstrating that charter schools in 15 states—about one third of the states with charter schools—had reported over $100 million
in fraud, waste, abuse, and mismanagement since 1994. In 2015 and 2016, we released additional reports documenting millions of dollars in new alleged and con rmed cases of fraud, waste, abuse, and mismanagement in charter schools.

This report offers further evidence that the money we know has been misused is just the tip of the iceberg. With the new alleged and con rmed cases reported here, the nancial impact of fraud, waste, abuse, and mismanagement in charter schools has reached over $223 million since our rst report.

“Public funding for charter schools (including local, state, and federal expenditures) has reached over $40 billion annually. Yet despite this tremendous ongoing investment of public dollars in charter schools, all levels of government have failed to implement systems to proactively monitor charter schools for fraud, waste, abuse, and mismanagement. While charter schools are subject to signi cant reporting requirements by various public agencies (including federal monitors, chartering entities, county superintendents, and state controllers and auditors), very few of these agencies regularly monitor for fraud.

“The rapid expansion of the charter sector in recent years is a particularly important factor in the fraud epidemic. Local and state entities charged with oversight of charter schools are quickly becoming overwhelmed, yet the federal government continues to pour taxpayer dollars into this expansion project. Over the past 20 years, the federal Department of Education has channeled over $3 billion into states to increase the quantity of charter schools without requiring strong oversight systems. As a result, millions in federal dollars have been lost to fraud, waste, and mismanagement. The Every Student Succeeds Act (ESSA), passed in December 2015, required the federal Department of Education to increase the pace of spending signi cantly over the next 10 years, essentially doubling the total federal investment in charter schools in half the time. In 2017, President Trump and his Secretary of Education, Betsy DeVos, have proposed to increase federal funding for charter schools from $333 million in 2017 to $501 million in 2018. This increase comes after a 2016 report from the US Department of Education’s Of ce of Inspector General which found “significant risk” in the US Department of Education’s Office of Innovation and Improvement (OII) charter school grant program.

“DeVos should be particularly familiar with the dangers of fraud and abuse in charter schools. As a staunch advocate for charter schools in Michigan, DeVos has spent millions in campaign donations supporting state candidates who favored “school choice” and opposing increased oversight and regulation. The result of Michigan’s experiment in charters has been a system of failing schools run by for-pro t companies, and millions of dollars lost in fraud and waste.

“With the perpetuation of inadequate oversight mechanisms and the new in ux of federal funding, the amount of federal, state, and local dollars at risk of being lost to fraud, waste, and abuse in the charter sector is only going to grow.

“The number of instances of serious fraud uncovered by whistleblowers, reporters, and investigations suggests that the fraud problem extends well beyond the confirmed cases we know about. Based on the widely accepted estimate of the percentage of revenue the typical charter organization loses to fraud, the deficiencies in charter oversight throughout the country suggest that federal, state, and local governments stand to lose more than $2.1 billion in 2017, up from $1.8 billion in 2016.8 The vast majority of fraud perpetrated by charter officials will go undetected because federal and state governments, as well as local charter authorizers, lack the oversight systems necessary to detect the fraud.

“Setting up systems of oversight that can detect and deter charter school fraud is critical. The money saved by these oversight systems will almost certainly offset the cost of implementation. We recommend the following reforms:

“■ Mandate audits specifically designed to detect and prevent fraud, and increase the transparency and accountability of charter school operators and managers

“■ Design clear planning-based public investment programs to ensure that any expansion of charter school investment also ensures equity, transparency, and accountability

“■ Increase transparency and accountability to ensure that charter schools provide the information necessary for state agencies to detect and prevent fraud

“State and federal lawmakers should act now in establishing systems to prevent fraud, waste, abuse, and mismanagement. ESSA unfortunately does very little reduce these vulnerabilities in the Charter Schools Program. Without state and local lawmakers passing policies to increase oversight, taxpayers stand to lose millions of additional dollars to charter school fraud, waste, abuse, and mismanagement.”

Categories Accountability, Charter Schools, Corporate Reformers, Education Industry, For-Profit, Fraud, Privatization
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