Archives for category: Fraud

Calling John Oliver! The charter lobbyists have been criticizing Oliver for his expose of charter fraud last Sunday. Unfair, they say. Untrue, they say. Slanders charters, they say. Let’s see how they fit this story into their narrative.

Nicholas Trombetta, founder of the Pennsylvania Cyber Charter School, pleaded guilty to stealing $8 million from the school and diverting it for his personal use. Trombetta’s school was often featured on television as the nation’s first virtual charter. With an enrollment of 10,000 students from across the state, Trometta had receipts of $100 million a year. What to do with all that dough rolling in from taxpayers?

I have written about this scandal on several occasions, from the time Trombetta was charged in 2013. (See hereand here and here. Another cyber charter leader in Pennsylvania, June Brown, who ran the K-12 Agora Charter, was arrested and charged with stealing $6 million.

The Associated Press reports:

“PITTSBURGH (AP) — The founder and former CEO of an online public school that educates thousands of Pennsylvania students pleaded guilty Wednesday to federal tax fraud, acknowledging he siphoned more than $8 million from The Pennsylvania Cyber Charter School through for-profit and nonprofit companies he controlled.

“In entering his plea, Nicholas Trombetta, 61, who headed the school, acknowledged using the money to buy, among other things, a Bonita Springs, Florida, condominium for $933,000, pay $180,000 for houses for his mother and girlfriend in Ohio, and spend $990,000 more on groceries and other items.

“He manipulated companies he created and controlled to draw the money from the school, also spending it on a $300,000 plane, Assistant U.S. Attorney Stephen Kaufman said.

“Trombetta was making $127,000 to $144,000 annually at PA Cyber when he ran the illegal tax evasion scheme from 2006 to 2012. He faces up to five years in prison when he’s sentenced Dec. 20.

“By running the money through the companies or their straw owners, Trombetta avoided income taxes, though prosecutors haven’t said how much. Most of the siphoned money was squirreled away in Avanti Management Group, which functioned as Trombetta’s retirement savings account, Kaufman said.

“This case reflects the priority we’ve placed on protecting against fraud in education,” U.S. Attorney David Hickton said.

“The school, founded in Midland in 2000, had more than 11,000 students across the state when Trombetta was charged three years ago and still has more than 9,000. As a public institution, it’s funded by federal, state and local taxes. Districts across the state pay the school to educate any students who opt to enroll in PA Cyber instead of a bricks-and-mortar school.

“Trombetta almost didn’t plead guilty Wednesday when his attorney, Adam Hoffinger, began sparring with Kaufman, who had to describe the complicated conspiracy to the judge.

“Kaufman said Trombetta used Avanti, the National Network of Digital Schools and other companies in the scheme. The Network of Digital Schools markets a curriculum developed in conjunction with PA Cyber and sold it back to the school, while Avanti provided unspecified management services, the prosecutor said. Avanti had four owners who pretended to be equal 25 percent partners when, in reality, Trombetta owned 80 percent of the firm, Kaufman said.”

As readers of this blog know, deregulation of charters leads to fraud, graft, and abuse. On this site, I have documented scores of examples of fraudsters and grifters who take advantage of weak (or no) oversight to enrich themselves and to strand children in bad schools.

A few days ago, John Oliver ran an excellent segment about charter schools and the fraud associated with them. He barely scratched the surface. Charter supporters are furious and are saying that he “hurt” children, he savaged children, etc. (This is a familiar tactic; when I criticized the improbable test scores in New York City almost a decade ago, I was told that I was “hurting children and their teachers” by questioning the validity of the dramatic rise in scores.)

Fraud is a feature of deregulation, not a bug. When no one is looking, some people steal. Not everyone steals, but many do. That is why Ohio, Florida, Michigan, and California are scamming taxpayers. No one is demanding accountability. Politicians get paid off by charter friends, then cripple any effort to oversee them Ohio and Michigan spend $1 billion a year to subsidize charter schools, which are lower-performing than public schools.

The corporate reformers and privatizers are bombarding John Oliver with tweets and messages attacking his show.

Please let him know you support him.

Please take the time to contact John Oliver by writing him at management@avalonuk.com.

And tweet him @iamjohnoliver.

Don’t let the charter industry intimidate him.

Andy Goldstein addressed the school board of Palm Beach County, where he teaches, at a recent meeting:

Why My Wife and I Are Opting Out Our Daughter From Third-Grade High-Stakes Testing

Transcript of the original text:

Good evening. My name is Andy Goldstein. I’m a teacher at Omni Middle School and the proud parent of an eight-year-old daughter who attends one of our public elementary schools.

It seems like it was just yesterday when my daughter entered kindergarten. At that time, I talked about her at our August School Board meeting in 2013.

I said that my hopes and dreams for my daughter were that she would develop a lifelong love for learning that would serve her well as she learned to construct a life that would serve her and serve others as well.

I told this board that my wife and I were not particularly interested in having her be seen as a data point for others to make money from.

Now, three short years later, which seem to have gone by in the blink of an eye, she is entering third grade.

Tonight, I’m speaking as a parent, who also is a teacher.

In Florida, third grade is the beginning of high-stakes, standardized testing for our children.

What are the high-stakes?

• Our children, on the basis of one test, will receive a number, a 1, 2, 3, 4, or 5, which, will serve to define them.

Some students, may do well learning throughout the year, but do not test well and may receive a 1, a one being the lowest possible score.

Some may come from disadvantaged backgrounds and will receive a 1.

Some may be special needs students, who receive a 1.

These numbers work to define our students as to whom they are. “I’m a one. I’m a Failure.”

This high-stakes testing policy, mandated by state law, works to stigmatize our students and they grow up with a limiting self-concept of who they are and what they are capable of doing and becoming.

• On the basis of this one high-stakes test, some schools—those comprised of the poorest students, who need the most help—are labeled with an “F.” Failures. This stigmatizes these schools, whose faculty and staff may be working hard to meet the high needs of the surrounding neighborhood they serve. It also serves to increase the segregation at these already segregated schools. What parents, given the means to choose what community they will move into, will choose a neighborhood with a school labeled “F.”

• There is a lot of money being made on the part of testing companies, publishers, and vendors, based on this annual imposition of this high-stakes testing.

• This high-stakes testing is part of a corporate agenda, an agenda by the rich and powerful to demonize our public schools and privatize them through the rise of publicly funded, privately managed schools called charters. Our state legislature, bought and paid for by corporate interests, is cheating our children by defunding our public schools.

• “That’s the standard technique of privatization: defund, make sure things don’t work, people get angry, you hand it over to private capital,” says Noam Chomsky, an MIT professor.

• Our third graders are still babies, really. Do they really need the pressures of this high-stakes testing?

Recently, I read one account from a parent recounting the experience of her son when he was a third grader taking the FCAT. He was a good kid. He worked all year to learn. But he missed passing the FCAT by one point. He went to summer school to do more work and took it again. And again, he missed passing the test by one point. His mother was afraid to tell him, but he could tell by her reaction that he had not passed. He was crushed by the sense of failure. His mother, working on making dinner in the kitchen, called him to come down to eat. He did not respond. She had a premonition that something was the matter. She rushed up to his bedroom and found him hanging by a bedsheet. She got him down.

• Is there anyone who thinks this high-stakes testing is worth such a price?

• As a parent, I can answer with a resounding NO!

• My wife and I believe that our public schools should work to develop the whole, creative child in all of our schools, and in all of our communities of all colors and all socio-economic backgrounds.

• For these reasons, I’m announcing to you, our school board, that my wife and I do not support high-stakes testing in Florida, and will be opting out our daughter. Evidence for her learning will be through a portfolio.

• Thank you.

The State Auditor is supposed to be the independent, disinterested official who guards the public interest. Ohio has what may be the most wasteful, politically influenced, and low-performing charter industry in the nation. And as you will see in the following post by Bill Phillis of the Ohio Equity & Adequacy Coalition, no one is protecting the public interest. In a state where hundreds of millions of dollars have been squandered on failed charters, law enforcement should be investigating state officials.

“Day 2 (August 12) of Charter School Summit-State Auditor: “We in the charter movement must speak with one voice”

“The clear message from the State Auditor to the charter school audience on August 12 was that the charter industry must speak with one voice to get more funding for operations and facilities. He noted that traditional public school advocates speak with one voice. Since when?

“While interviewing some high performing charter school students, the Auditor orchestrated a line of questioning which left the impression that charter students are courageous pioneers in a movement that is preferred to the traditional public system. Meanwhile, notwithstanding that state officials have failed to maintain a thorough and efficient system of common schools, traditional schools outperform the charter industry.”

William Phillis
Ohio E & A

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John Oliver, who has a regular show on HBO, devoted a big chunk of his program last night to explaining the frauds perpetrated by unregulated and unsupervised charter schools. He also reminds his viewers that the language of competition and choice is a hoax when talking about education. You will see charters opening and closing like shoe stores in a mall. You will see charter owners fattening their bank accounts at the expense of the children. You will see charter operators plagiarizing their applications from others.

Readers of this blog will see some familiar scams–in Philadelphia, Florida, and Ohio, for example–but even you might be surprised by some of the stories he shows and documents.

With enough time, he might have devoted an entire hour to the scams in California, Texas, Indiana, and elsewhere.

But the great thing about his show is that this is the first time that a major media outlet has demonstrated the bipartisan consensus that supports frauds.

Please watch and share with your friends and neighbors.

Maurice Cunningham is all over the dark money behind the push for more charter schools in Massachusetts.

In this post, he reproduces the logo of the ad that was shown during the Olympics.

“YES ON 2 FOR STRONGER PUBLIC SCHOOLS.”

That is dishonest. Question 2 is about increasing the number of privately managed charter schools.

If the ad were honest, it would say:

“YES ON 2 FOR PRIVATIZATION OF YOUR PUBLIC SCHOOLS.”

Cunningham tries to find out who paid for the ad. He digs through a list of committees and groups, and the best he can say for sure is that there is hedge fund money. As he showed in the previous post, the “YES” vote is being paid for by Republican elites. They don’t like public schools, they don’t like unions. Charter schools get rid of both.

The election in November is crucial. If the privatizers can defeat public schools in the state where they were invented, then we are all in serious trouble. That must be why the privatizers focused on Massachusetts, which is far and away the best state system in the nation.

However, if they lose in Massachusetts, after pouring in nearly $20 million, they might wake up and realize that they are fighting a losing battle.

The key to victory for parents and students is an informed public. If the people realize that this campaign is actually intended to destroy their public schools, then the people will never support it.

Don’t let the privatizers get away with their propaganda.

Nashville rejected their lies; so can Massachusetts, but it will take a lot of ringing of doorbells and volunteer activism.

Jean Haverhill is working to defeat the deceptive Question 2 on the ballot in Massacusetts, which would add new charter schools every year. It’s sponsors claim that new charter schools will “improve public education.” Jean and many parents know from the experience of other states that more charters mean less funding for public schools. She knows that charters undermine public schools. Why create a dual school system?

She commented earlier today:


“Haverhill [Massachusetts] loses 2.7 million in these funds that go to charter; the state of MA loses 400 million (there is a city by city of how much is being drawn off)…. Yes, the ad is deceptive when they say there is “more “money for public schools.”

She added:


I was very proud of the Mayor in Haverhill MA (and school committee resolution and talking with city council on this issue)

Marc Kenen, executive director of the charter school association, and Mayor James J. Fiorentini (Haverhill mayor) at last night’s Haverhill School Committee discussion of a resolution against lifting the cap. [The meeting tape is online. ]

Kenan: [2:09:00]:
We don’t have a traditional school committee like you. Our board of trustees is not elected, like you. It’s an innovative model. It’s a different model, we’re trying something different. [He went on to describe it as similar to the way non-profit boards are chosen.]

Mayor Fiorentini: [2:28:10]:

The gentleman that spoke said, “We don’t have an election, we have a new and innovative way of choosing people to run our schools.” Well, we have an innovative way of running them. It’s called “democracy.”

I wrote and thanked Mayor Fiorentini; we are doing telephone calls and canvassing with door hangers in Haverhill MA two or more days a week if anyone has any time; check your local area; I know Brockton MA has a team also SAVEOURPUBLICSCHOOLSMA.com

Julian Vasquez Heilig reports on his blog that the ACLU in Southern California has released a report finding that 20% or more of the state’s charter schools are breaking state and federal laws.

This is very likely the tip of the iceberg and signals that the state should launch a full investigation of illegal activities in charter schools.

Here is the full report.

Will the state dare to investigate privately managed schools that operate with little or no supervision? Will they dare to cross the state’s most powerful lobby, the California Charter Schools Association?

Bill Phillis of the Ohio Equity and Adequacy Coalition writes about the results of an investigation conducted by the Ohio Department of Education.

ECOT is the Electronic Classroom of Tomorrow. It is a for-profit online virtual school. It has one of the lowest graduation rates of any school in the nation. Its owner, William Lager, is one of the biggest campaign contributors to Republicans in Ohio.

ECOT’s waste felt at the school district level

The Ohio Department of Education (ODE) has determined that a sample of ECOT students participate, on the average, one hour per day-one fifth of the time required. If that holds true of ECOT’s enrollment, of the $108 million ECOT extracted from school districts in FY 2016, a total of more than $80 million was collected for time students were not participating in instruction.

589 districts are suffering funding deductions flowing to ECOT. On the average, the deduction is $183,175 per district. Columbus Public Schools lost $11,618,822 to ECOT at the high end and Indian Creek lost $177 last school year.

The ECOT scheme drains scarce resources from school districts–and for what? Student participation, an average for 20% of the time required. Hence, for a district like Northridge Local in Licking County, over $100,000 of its $154,000 flows to ECOT for time students are not participating.

The district-by-district deduction data should be of concern to school officials and their constituents.

Our friend Bill Phillis of the Ohio Equity and Adequacy Coalition posted the following news:

On June 29 Geneva Area City Schools adopted a resolution to invoice the state for charter school deductions

School Treasurer Kevin Lillie’s message and the Board’s resolution were forwarded to over 30 public officials and media persons. The spreadsheet should be of particular interest.

William Phillis
Ohio E & A

This is treasurer Kevin Lillie’s message:

At the regular meeting of the Geneva Area City Board of Education on June 29, 2016, the Board unanimously approved a Resolution to invoice the State of Ohio through the Ohio Department of Education for past charter school deductions consisting of state and local funding.  Please see the attached Resolution and invoice.  Over the past 16 fiscal years, $4,265,924.70 has been taken away from Geneva Area City Schools via State Foundation Settlement deductions and sent to under-performing charter schools.  What originally started as a five-year experiment, which was never completed or never evaluated for effectiveness, has turned into a monster at a tremendous waste of taxpayer funds and irreparable harm to Ohio’s school children.  Many of these charter schools are for-profit ventures, draining money from Ohio to outside individuals and greedy corporations whose only motive is to line their pockets with easy cash.  These charter schools lack oversight and regulation and are wrought with fraud and corruption.  How does one explain away the NCAA not accepting transcripts form a particular online charter school, or FBI raids on a chain of charters operated by a Turkish Islamic cleric which imports teachers from Turkey instead of hiring Ohio citizens (only a small part of the problems with these particular charters), or a Dayton-area charter school spending $4,167 per pupil to rent the building it uses from a sister company?  It is for these reasons that the Geneva Area City Board of Education has chosen to invoice the State of Ohio and ODE for the full amount of the charter school deductions.

These charter school deductions have drained needed funds from our District and districts all over Ohio.  These deductions along with state funding reductions over the past seven years have forced many districts like ours to cut teachers and support staff, increase class sizes, reduce course offerings, cut some student activity groups and sports, and institute pay to participate fees to keep other sports.  Meanwhile, much of the taxpayers’ money taken from our District and sent to charter schools is being used for fraudulent advertising, high administration salaries, and campaign contributions.  It is time to clean up the fraud and corruption in charters and stop wasting taxpayer funds.

Also attached are spreadsheets comparing the performance Geneva Area City Schools to the charter schools receiving our resident students.  I hope you will take the time to read the resolution and invoice and view the charter school comparisons.

Sincerely, 
  

Kevin Lillie, Treasurer/CFO
Geneva Area City Schools
135 S. Eagle St.
Geneva, OH 44041
Ph:  440-415-9304
Fax:  440-466-0908
Email:  kevin.lillie@genevaschools.org

Please note new email address:  kevin.lillie@genevaschools.org  

Here is the Board’s resolution.

I can’t copy and paste the Board’s resolution. Please read it. It is powerful.

It makes clear that Ohio’s charters have made the state the “laughing stock of the nation” and that the state’s charters perform below public schools and are rife with corruption and fraud.

This is one impressive school board!