Archives for category: Fraud
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Florida: How Charter Schools Are Used to Hide Dropouts and Game the System

By dianeravitch
February 22, 2017 //
21

Heather Vogell and Hannah Fresques published an important piece of investigative journalism that appears in ProPublica and USA Today about a new twist on the charter scamming in Florida. The scam is the result of Jeb Bush’s high-stakes accountability system, which incentivizes schools to get rid of low-performing students in order to maintain their letter grades and rankings.

Here is the shorthand: School officials nationwide dodge accountability ratings by steering low achievers to alternative programs. In Orlando, Florida, the nation’s tenth-largest district, thousands of students who leave alternative charters run by a for-profit company aren’t counted as dropouts. Is this why nationwide graduation rates are going up? Is this what Arne Duncan claimed credit for?

It begins like this:

TUCKED AMONG POSH GATED COMMUNITIES, and meticulously landscaped shopping centers, Olympia High School in Orlando offers more than two dozen Advanced Placement courses, even more afterschool clubs, and an array of sports from bowling to water polo. U.S. News and World Report ranked it among the nation’s top 1,000 high schools last year. Big letters painted in brown on one campus building urge its more than 3,000 students to “Finish Strong.”

Olympia’s success in recent years, however, has been linked to another, quite different school five miles away. Last school year, 137 students assigned to Olympia’s attendance zone instead attended Sunshine High, a charter alternative school run by a for-profit company. Sunshine stands a few doors down from a tobacco shop and a liquor store in a strip mall. It offers no sports teams and few extra-curricular activities.

Sunshine’s 455 students — more than 85 percent of whom are black or Hispanic — sit for four hours a day in front of computers with little or no live teaching. One former student said he was left to himself to goof off or cheat on tests by looking up answers on the internet. A current student said he was robbed near the strip mall’s parking lot, twice.

Sunshine takes in cast-offs from Olympia and other Orlando high schools in a mutually beneficial arrangement. Olympia keeps its graduation rate above 90 percent — and its rating an “A” under Florida’s all-important grading system for schools — partly by shipping its worst achievers to Sunshine. Sunshine collects enough school district money to cover costs and pay its management firm, Accelerated Learning Solutions (ALS), a more than $1.5 million-a-year “management fee,” 2015 financial records show — more than what the school spends on instruction.

But students lose out, a ProPublica investigation found. Once enrolled at Sunshine, hundreds of them exit quickly with no degree and limited prospects. The departures expose a practice in which officials in the nation’s tenth-largest school district have for years quietly funneled thousands of disadvantaged students — some say against their wishes — into alternative charter schools that allow them to disappear without counting as dropouts.

Keep reading. It is a shocking story, especially in light of the fact that Betsy DeVos is so impressed with Florida’s “success” that she wants to use it as a model for the nation. She surely can’t use her home state of Michigan as a model in light of its precipitous decline in national rankings on NAEP. What Florida and Michigan have in common, however, are for-profit charter chains, where the owners profit handsomely but the kids do not.

Categories Accountability, Betsy DeVos, Charter Schools, Corporate Reformers, Education Industry, Florida, For-Profit, Fraud, Graduation rates, Hoax, Privatization

Who Profits from For-Profit “Higher Education”? Squalor, at the Expense of Students

By dianeravitch
February 21, 2017 //
3

This is a story I published last June.

It is more timely than ever now that Trump and Devos, both of who love the for-profit sector, have taken charge of the federal role in education.

For shame!

Categories For-Profit, Fraud, Higher Education

For-Profit “Universities” Set to Cash in During Trump Era

By dianeravitch
February 21, 2017 //
7

During the Obama years, it appeared that the federal government was going to start cracking down on the for-profit “higher education” industry, which typically gets horrible results and loads students with debt. (As I have reported in the past, former officials of the Obama Department of Education bought control of one of the nation’s largest for-profit college chains.)

But with the election victory of Donald Trump, sponsor of the fraudulent Trump University, the stock prices of for-profit education corporations went through the roof. Why would anyone expect a man who profited as founder of Trump University to crack down on others doing the same?

The New York Times reports:

Since Election Day, for-profit college companies have been on a hot streak. DeVry Education Group’s stock has leapt more than 40 percent. Strayer’s jumped 35 percent and Grand Canyon Education’s more than 28 percent.

You do not need an M.B.A. to figure out why. Top officials in Washington who spearheaded a relentless crackdown on the multibillion-dollar industry have been replaced by others who have profited from it.

President Trump ran the now-defunct Trump University, which wound up besieged by lawsuits from former students and New York’s attorney general, who called the operation a fraud. Within days of the election, Mr. Trump, without admitting any wrongdoing, agreed to a $25 million settlement.

Betsy DeVos, the newly installed secretary of education, is an ardent campaigner for privately run schools and has investments in for-profit educational ventures.

Please notice the use of the present tense “has.” Betsy DeVos did not divest her holdings in for-profit entities that are in direct conflict with her duties as Secretary of Education. Apparently in the Trump regime, ethics laws have been suspended for everyone, at least at the cabinet level.

While Ms. DeVos’s nomination attracted a flood of attention, most was focused on the K-through-12 system and the use of taxpayer-funded vouchers for private, online and religious schools. Higher education was barely mentioned during her confirmation hearings.

Yet colleges and universities are the institutions most directly influenced by the federal government, while public schools remain largely in the hands of states and localities. So it is in higher education that the new administration’s power is likely to be felt most keenly and quickly.

Under the Obama administration, the Education Department discouraged students from attending for-profit colleges, arguing recently that the data showed “community colleges offer a better deal than comparable programs at for-profit colleges with higher price tags.”

The for-profit sector has about 8 percent of those enrolled in higher education, according to the Education Department, but it has 15 percent of subsidized student loans.

While some career training schools delivered as promised, critics argued that too many burdened veterans, minorities and low-income strivers with unmanageable tuition debt without equipping them with jobs and skills that would enable them to pay it off.

After years of growing complaints and lawsuits, the agency moved aggressively to end abusive practices that ranged from deceptive advertising to fraud and cost students and taxpayers billions of dollars.

Two mammoth chains collapsed — Corinthian Colleges in 2015, and ITT Technical Institute in 2016 — leaving thousands of students stranded without degrees and in debt. Overall enrollment in for-profit institutions declined from 2.4 million in 2010 to 1.6 million in 2015 as hundreds of campuses closed. And as the largest provider of student loans, the federal government was left to bail out the defrauded.

Please open the article and check out the links.

Categories Accountability, For-Profit, Fraud, Higher Education

North Carolina: Employee at Voucher School Charged with Stealing $400,000

By dianeravitch
February 17, 2017 //
8

An employee at North Carolina’s largest voucher-receiving school was charged with the theft of $400,000 in taxpayer money.

He discovered how to make money in education: Steal it.

Lindsay Wagner writes:

“The athletic director of a private religious school that has received the most publicly-funded school vouchers in the state of North Carolina was arrested this week on charges of embezzling from the school nearly $400,000 in public tax dollars, the Fayetteville Observer reports.

“Heath Curtis Vandevender is charged with embezzling $388,422 between Jan. 1, 2008, and Dec. 31, 2015, from Truth Outreach Center Inc., located in Fayetteville. Trinity Christian School, which has received nearly $1 million in publicly-funded school vouchers since 2014, is under the Truth Outreach Center’s umbrella, according to the Fayetteville Observer.

“The funds that Vandevender is accused of embezzling over a seven year period are allegedly taken from employee withholding tax money that was to go to the N.C. Department of Revenue.

“Vandevender “aided and abetted the corporation to embezzle, misapply, and convert to its own use $388,422.68 in North Carolina Withholding Tax,” according to the Department of Revenue’s press release.

“It’s unknown whether or not federal tax funds that the organization is supposed to withhold from employee paychecks and submit to the federal government were also misappropriated.”

Wagner attempted to get a copy of the school’s financial audits but discovered that the law requires audits but does not require that audits be made public.

Sweet deal. But not for taxpayers.

Hope Betsy DeVos goes to visit Trinity Christian to show the nation how vouchers are working out.

Categories Accountability, Fraud, North Carolina, Privatization, Vouchers

Today the Fight to Save Our Public Schools Begins

By dianeravitch
February 8, 2017 //
39

The Network for Public Education will watch what Betsy DeVos does and report it to you immediately.

We will keep you informed about what the privatizers are doing in your state and community.

We will help you connect with other people in your state who are mobilizing to stop privatization.

The fight to save public education will happen in communities and districts, at the grassroots level.

We ask you to join us, become active, send us action alerts about meetings, protests and demonstrations in your district or town or city so we can help you get the news out.

Here is information you can use:

Get everyone you can to join NPE. Sign them up

http://networkforpubliceducation.org/become-a-member/

Tell others on Facebook to join. We will be mobilizing in the months ahead.

Create a local group in support of public schools. Use Facebook or create a website. Then join our Grassroots Network.

http://networkforpubliceducation.org/grassroots-education-network-3/

Read our emails. We will be regularly launching campaigns at the national and state level.

Make a donation. If we are to fight this we will need funds. http://networkforpubliceducation.org/about-npe/donate/

Together, we will build a movement so powerful that we can beat Donald Trump, Betsy DeVos, and all others who aim to privatize our public schools. Together we can keep the for-profit privateers and frauds out of our schools.

Work with us. We need your help.

Categories Betsy DeVos, Budget Cuts, Charter Schools, Corporate Reform, Democracy, For-Profit, Fraud, Network for Public Education, Networkfor Public Education Action Fund, Privatization, Trump, Vouchers

Jim Hall: Arizona Charter Operator Makes Millions by Real Estate Deals with Taxpayer Money

By dianeravitch
February 4, 2017 //
3

Jim Hall, whom I wrote about in the previous post, has uncovered many charter scams in Arizona. Here is his latest report. Open the link to read his attachments and documentation.

Arizonans for Charter School Accountability

arizcsa1000@gmail.com
602-343-3021

The Consequences of Unregulated Charter Schools:

The Leona Group LLC Reaps Millions in Real Estate Profits While Arizona Taxpayers (and Students) Foot the Bill

Arizonans for Charter School Accountability recently released two reports on charter school classroom spending in 2016 (see links below) finding that 191 Arizona charter schools are efficiently run and spend more money in the classroom than on administration and facilities combined. A majority of charter schools, however, spend less on classroom instruction than on administration and buildings. Imagine Inc. and the Leona Group LLC manage the majority of schools spending more on administration and facilities than in the classroom.

This report focuses on the Leona Group LLC which manages 25 schools in Arizona (and over 60 schools total in five states) to try to understand why Leona Group LLC managed schools spend so little on classroom instruction.

These were the key findings:

In 2007, Bill Coats, the sole owner of the Leona Group LLC, sold 10 schools owned by Leona Group LLC to a non-profit foundation Coats created in 1998, the American Charter Schools Foundation ACSF), for $33,890,485 more than their market value.

Bill Coats maintains the same management control over the schools as he had when Leona Group LLC owned the schools but now has set management fees that are not based on student enrollment.

ACSF schools have declined in enrollment by 25% since their purchase in 2007.

Between 2007 and 2016 overall instruction spending in ACSF schools has declined from $2090/pupil to $1455/pupil while facilities costs increased from $1455/pupil to $2479/pupil.

The real estate windfall Bill Coats received in 2007 by selling schools to his own foundation has caused ACSF to cut classroom spending to among the lowest rates of any school in Arizona – to fund the excessive mortgages.

Jim Hall, founder of Arizonans for Charter School Accountability, stated “ The Leona Group LLC has made tens of millions of dollars selling schools to their own non-profit foundation for double their market value – and still retain complete management control. The schools now spend most of their budgets on mortgages and management. Arizona doesn’t monitor charter school spending so this kind of waste and abuse goes unnoticed.”

Hall continued, “ The Arizona Auditor General needs to monitor charter spending and the Arizona Board for Charter Schools needs to sanction charter schools that divert public funds to corporate profits at the expense of children in the classroom.”

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

Retired Educator Creates “Arizonans for Charter School Accountability,” Exposes Frauds and Scams

By dianeravitch
February 4, 2017 //
13

Jim Hall retired after three decades in education. He founded Arizonans for Charter School Accountability. He explains here:

I retired in June after over 30 years in education and 23 years as a school principal. One day I happened to find my research on charter school financing that was to be my dissertation for a PhD I never completed. I did a little research into one of the charter school companies I was studying and realized there were still major concerns about the financial accountability of charter schools in Arizona. I noticed that the charter organization was having a board meeting on September 10th so I decided to attend.

I started this organization largely because of an incident that occurred when I attended the board meeting. The Board President demanded to know my name – I repeated over and over that I was a member of the public and did not have to give my name. At the end of the meeting, a senior member of the company that manages the charter schools demanded my name in the hallway outside the meeting room. I refused and she pulled out her phone and took my picture saying “I’m taking your picture in case there are problems in the future”. I was completely shocked at this display of arrogance.

Arizonans for Charter School Accountability was born the next day. I filed a complaint with the Attorney General on behalf of ACSA regarding the violations of Arizona’s open meeting law. The AG’s office investigated the charter organization and they were forced to revise their website at each school and provide documents they had neglected to post in the past. The investigation is ongoing. Apparently, from the Board agenda for the October 15, 2014, they are being subjected to a “document audit” by the Attorney General’s office.

The charter organization finally posted their 2015 budget that should have been posted in July. It was a mess – there were significant areas that had they simply left blank. I found that they submitted this budget to the Arizona Department of Education and it was accepted, apparently without examining it. I made official complaints to the Arizona State Board of Charter Schools against the charter organization for filing incomplete budgets. I registered a complaint to the Auditor General’s office because ADE was negligent in accepting the budgets.

This week, on October 15, 2014, the charter organization submitted their Annual Financial Report for 2014 to ADE as is required by law. It too was full of omissions. Looking back over the last five years, all of their annual financial reports were incomplete. Today I filed additional complaints with the Charter School Board and the Auditor General’s office.

The budget and the annual financial report are literally the only documents charters have to submit to the State, since they can request waivers from compliance from both financial regulations and procurement rules. The State of Arizona apparently doesn’t even read these documents.

Charter schools waste millions of education dollars every year, at the expense of public schools and the children of Arizona. Corporate charter schools act with impunity because no one examines their actions.

I now have a passion that will fill my retirement. The Arizonans for Charter School Accountability will continue to examine the financial dealings of this charter organization and others. We will file complaint after complaint. We will go to the media to expose corrupt organizations. We will fight to change the law so that charter schools have financial accountability to the taxpayers of Arizona.

 

Categories Arizona, Charter Schools, For-Profit, Fraud, Hoax

Politico: Opposition to DeVos “Snowballs into an Avalanche”

By dianeravitch
February 4, 2017 //
25

Politico reports that the offices of Republican Senators are overwhelmed with letters, emails, and faxes opposing Betsy DeVos, according to Politico. She is the most controversial and unpopular cabinet choice of Trump, and Senators have been overwhelmed by negative comments. Most of them have gone into hiding. Their phone lines are jammed or off the hook.

The reasons for the avalanche of opposition:

1. She is unqualified, having no experience as a parent, student, teacher, or local board member in a public school, which 85% of American students attend 10% in private schools and 5% in privately owned charter schools).

2. She is a lobbyist for privatization of public schools.

3. As she demonstrated in her Senate hearings, she is ignorant of federal law and policy.

4. She is hostile to public schools.

5. If appointed, she will transfer federal funds from public schools to non-public schools.

6. She uses her vast fortune to buy votes of Republican senators.

Parents care about their children and their schools and communities. They object to a Secretary of Education who doesn’t care about their public schools and will hurt their children and their communities while prattling about “great schools.” Indeeed, they may even be aware of the damage DeVos has already done to the public schools of Michigan.

If no Republican breaks ranks, voters must remember in November: 2018, 2020, and 2022. Actions have consequences.

Why in the world does the GOP stand fast behind a nominee who is so clearly uninformed? Could it be the millions she and her family have given them? As DeVos once said, we do expect something in return for our money. Payback day arrived and she is getting what she paid for.

Trump has nominated many people who were unfitted to the mission of their Department, like Dr. Carson for HUD, Scott Pruitt for EPA. But DeVos! Our public schools are at risk.

It is not the grizzly bears that are alarmed by DeVos. It’s the Mama Bears. They protect their cubs.

Categories Betsy DeVos, Charter Schools, Corporate Reformers, For-Profit, Fraud, Michigan, Parents, Privatization, School Choice, Vouchers

Betsy DeVos Lied to Senate Committee about Cybercharter Graduation Rates

By dianeravitch
February 2, 2017 //
32

Betsy DeVos is a huge fan of cybercharters. When responding in writing to questions from the Senate HELP Committee, she cited astonishing graduation rates for cybercharters.

She lied.

Benjamin Herold of Education Week did the fact-checking:

In her written response to questions from a key Democratic senator, Education Secretary-nominee Betsy DeVos defended full-time online charter schools using graduation rates significantly higher than those used for state and federal accountability purposes. The figures and language cited by DeVos directly mirror those used in a report from K12 Inc., the country’s largest for-profit operator of cyber charter schools, in which DeVos is a former investor.

According to the Ohio education department, for example, the Ohio Virtual Academy has a four-year graduation rate of 53 percent, good for an “F” on the state’s accountability system.

DeVos put the figure at 92 percent….

She was specific in her lies.

In written questions, Murray, who is the ranking member of the Senate Health, Education, Labor and Pensions committee, asked whether it is appropriate to advocate for the schools, despite their poor results.

DeVos responded:

“High quality virtual charter schools provide valuable options to families, particularly those who live in rural areas where brick-and-mortar schools might not have the capacity to provide the range of courses or other educational experiences for students. Because of this, we must be careful not to brand an entire category of schools as failing students.”

She then cited a number of schools and what she described as their graduation rates, which differ markedly from the figures used by each school’s state for accountability purposes:

The Idaho Virtual Academy has a 90 percent graduation rate, DeVos said. The school’s most recent publicly reported figure for state accountability purposes is 33 percent.

The Nevada Virtual Academy has a 100 percent graduation rate, DeVos said. The school’s most recent publicly reported figure for state accountability purposes is 67 percent.

The Ohio Virtual Academy has a 92 percent graduation rate, DeVos said. The school’s most recent publicly reported figure for state accountability purposes is 53 percent.

The Oklahoma Virtual Academy has a 91 percent graduation rate, DeVos said. The school’s most recent publicly reported figure for state accountability purposes is 40 percent.

The Utah Virtual Academy has a 96 percent graduation rate, DeVos said. The school’s most recent publicly reported figure for state accountability purposes is 42 percent.

The schools listed in DeVos’ written response, and the language she used to introduce them—”the following virtual academies have four-year cohort graduation rates at or above 90 percent”—is the same as the language used by K12 Inc. in its 2016 Academic Report.

Here is what she did not mention, but that the Senate HELP Committee–and the full Senate–should know.

The Tennessee Virtual Academy is the lowest-performing school in the state (Senator Alexander must know that). When then-State Commissioner of Education Kevin Huffman tried to close it, he was stymied by its friends in high places.

The New York Times reported that the Electronic Classroom of Tomorrow has the lowest graduation rate in the nation.

Even DFER founder Whitney Tilson inveighed against K12 Inc. because of its “dismal academic results” and “sky high” attrition rates.

Stephen Henderson, the editorial page editor of the Detroit Free Press, warned that Betsy DeVos has a long-standing habit of twisting data to promote her favorite causes (charters and vouchers), and that she is not to be trusted to tell the truth.

He wrote:

A true advocate for children would look at the statistics for charter versus traditional public schools in Michigan and suggest taking a pause, to see what’s working, what’s not, and how we might alter the course.

Instead, DeVos and her family have spent millions advocating for the state’s cap on charter schools to be lifted, so more operators can open and, if they choose, profit from more charters.

Someone focused on outcomes for Detroit students might have looked at the data and suggested better oversight and accountability.

But just this year, DeVos and her family heavily pressured lawmakers to dump a bipartisan-supported oversight commission for all schools in the city, and then showered the GOP majority who complied with more than $1 million dollars in campaign contributions.

The Department of Education needs a secretary who values data and research, and respects the relationship between outcomes and policy imperatives.

Nothing in Betsy DeVos’ history of lobbying to shield the charter industry from greater accountability suggests she understands that.

If she’s confirmed, it will be a dark day for the value of data and truth in education policy.

Categories Betsy DeVos, Education Reform, For-Profit, Fraud, Graduation rates, Virtual Charter Schools

Los Angeles: Charter School, Raided by FBI, Has Money for Parties, Not for Basic Supplies

By dianeravitch
February 1, 2017 //
31

Last week, federal authorities raided the offices of Celerity charter schools in Los Angeles. The Los Angeles Times takes a closer look at the Celerity charters in this article.

Teacher Tien Le worked at Celerity Dyad Charter School, where she

taught in a portable classroom on an asphalt lot — not unheard of in this city of tight squeezes and little green space, but her students also had no library, cafeteria or gymnasium. The school didn’t provide most supplies, Le said, so when her sixth-graders needed books, or an extra pencil and paper, she spent her own money to buy them.

Months into her first year at Dyad, Le and her colleagues were invited by the organization that managed the school to a holiday party at a large house on a winding street in Hollywood. She parked in a lot rented for the occasion and took a shuttle to the house with other teachers and staff. Inside, there were two open bars, casino tables for poker and blackjack, and a karaoke room. At evening’s end, a limousine ferried guests back to their cars.

“I remember being really confused that night,” Le said. “When I asked for basic supplies, I couldn’t get those things, yet you have money for this expensive party? I know at big corporations and for-profit places these parties are normal, but for a public school it was not normal.”

Celerity operates seven charter schools in Southern California and four in Louisiana.

The investigation is ongoing. I can’t help but wonder whether Betsy DeVos will call a halt to the investigation when and if she becomes Secretary of Education. True, the FBI is involved, but a phone call to her friend in the White House….

Categories Betsy DeVos, California, Charter Schools, Corporate Reformers, Education Industry, Fraud, Los Angeles, Privatization
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