Friends in Oklahoma sent the charging document that lays out the evidence against the founders of the Epic Charter School. They are accused of skimming off millions of dollars. The charging document explains how they did it.
Is this happening in your state? The biggest charter frauds seem to occur in virtual charters like the A4 scam in California, which siphoned off hundreds of millions of taxpayer dollars before it was discovered.
The online charter sector not only has abysmal academic records, but it’s ripe pickings for scammers. The founders of Epic charter schools in Oklahoma are charged with multiple counts of embezzlement, racketeering and other crimes.
Epic Charter Schools’ founders, who were arrested Thursday, shifted millions of school dollars to company credit cards, which were used to make political campaign donations, fund a lobbyist and pay personal expenses like vacations, the Oklahoma State Bureau of Investigation alleges in court documents.
Following a yearslong investigation into alleged embezzlement of taxpayer funds, the co-founders of the state’s largest online school were arrested Thursday, along with the longtime chief financial officer, court records show.
David Chaney, 43, Ben Harris, 46, and Josh Brock, 40, were booked into the Oklahoma County Detention Center Thursday morning. Each is charged with racketeering, embezzlement, obtaining money by false pretense, conspiracy to commit a felony, violating the Oklahoma Computer Crimes Act, submitting false documents to the state and unlawful proceeds.
Investigators said the men ran a complicated criminal enterprise using the online charter school and a for-profit company, Epic Youth Services.
The scheme has cost the state more than $22 million, according to the OSBI.
The charges involve co-mingling of funds, excessive and unnecessary management fees, use of Oklahoma tax dollars in California, political influence, concealment of profits, submission of false invoices and the illegal use of employees.
One of the school’s largest recruitment tools, the learning fund, was used to conceal illegal purchases, agents alleged. For the learning fund, Epic makes at least $1,000 available to each student annually in a virtual account. Parents can allocate those dollars for curriculum, laptops and extracurricular activities.
Parents don’t receive the money directly. Instead, they request a purchase from Epic and the school transfers the money to Epic Youth Services, which pays the vendor.
Chaney and Harris used a separate bank account to make learning fund purchases, and investigators found Chaney and Harris didn’t return unused learning fund dollars.
The account received nearly $145 million between 2015 and 2021. More than 50 times, Chaney, Harris and Brock transferred public funds from the learning fund account to the private bank account for Epic Youth Services, which was then used to pay a lobbying firm. Capital Gains, a lobbying firm run by Robert Stem, a longtime friend of Harris’, was paid more than $500,000.
Please open the link to read the rest of the story. Campaign contributions go a long way towards avoiding accountability.
Thank goodness for independent media! Oklahoma Watch published an investigative report that detailed a secret slush fund that supplements the salary of the state Secretary of Education.
(This story was produced in partnership with the Oklahoma nonprofit newsroom The Frontier.)
Gov. Kevin Stitt vetoed legislation that would have required cabinet members to file public reports to disclose their finances.
If Stitt had signed the bill last month, Oklahomans would learn that Secretary of Education Ryan Walters makes at least $120,000 a year as executive director of a nonprofit organization that keeps its donors secret. Walters is also paid about $40,000 a year by the state, according to state payroll data.
The nonprofit, Every Kid Counts Oklahoma, has refused to disclose its largest donors.
But a joint investigation by The Frontier and Oklahoma Watch has found that much of the organization’s funds come from national school privatization and charter school expansion advocates, including the Walton Family Foundation and an education group founded by billionaire industrialist Charles Koch.
As Secretary of Education, Walters serves as Stitt’s top advisor on public education policy and is the governor’s liaison for dozens of state boards and programs.
Walters’ outside employment with a nonprofit funded by advocacy groups could be a conflict of interest, said Delaney Marsco, senior attorney for ethics at the Campaign Legal Center, a nonprofit group that focuses on government transparency and accountability.
“If you are responsible for making decisions in a certain area of the government and you are being paid by an outside organization that has an interest in that, that absolutely can be a conflict of interest,” Marsco said. “If you are a public servant, your duty is to the public, and anything that kind of calls that into question, even raises the appearance of a conflict of interest, is a problem.”
Under Walters’ leadership, Every Kid Counts Oklahoma was the public face of Stitt’s program that distributed $1,500 grants to families in 2020 funded with $8 million in federal coronavirus relief money. The money was intended to buy tutoring and educational supplies. But a lack of safeguards allowed parents to use some of the funds to buy TVs, gaming consoles and home appliances, an investigation by Oklahoma Watch and The Frontier found. Emails and other recordsshow that Walters helped secure the no-bid contract with a Florida company to distribute the money. The U.S. Department of Education’s Office of Inspector General has opened an audit into how the state used those funds.
Walters, who declined multiple interview requests, is now running for state superintendent, an elected position overseeing the state Department of Education and a budget of over $3 billion. Unlike in federal elections, candidates for state office in Oklahoma are not required to fill out financial disclosures until after they are elected.
Please open the link and read on.
Governor Stitt had a libertarian theory. If you give out government money to families for education, they know what’s best. Turns out, some do and some don’t.
Jennifer Palmer of Oklahoma Watch and The Frontier wrote:
Just get the money to families. That was the driving force behind Gov. Kevin Stitt’s plan for $18 million in U.S. Department of Education relief dollars intended to help students during the coronavirus pandemic.
Other states used federal money to train new teachers or support programs for deaf and blind students. But in Oklahoma, a history teacher with political ambitions helped a Florida tech company win a no-bid state contract to rapidly distribute $8 million to families with little government oversight. Another $10 million went to private school vouchers.
With few guardrails, some families used Oklahoma’s share of federal Governor’s Emergency Education Relief Funds to buy Christmas trees, gaming consoles, electric fireplaces and outdoor grills, an investigation by Oklahoma Watch and The Frontier has found.
Months later the teacher, Ryan Walters, was on a national stage as Stitt’s new Secretary of Education, calling the effort a success.
Oklahoma’s contract with the Florida-based software company ClassWallet allowed families to quickly purchase educational supplies online through grants funded with federal relief money through the Bridge the Gap Digital Wallet program. At a virtual conference for a national school reform group in 2020, Walters touted the Bridge the Gap program as a model for how to start a school voucher program with “minimum staffing requirements and maximum quality control.”
“We didn’t have the government agency personnel with the background experience to do this and, quite frankly, we felt like there could be a more efficient way to do this outside our government agencies,” Walters said.
From the start, the strategy led to a lack of oversight on purchases, possibly violating the terms of the federal grant and state purchasing requirements, according to federal regulators.
While most parents spent the money on educational supplies, Oklahoma Watchand The Frontier found nearly half a million dollars in questionable purchases. The news organizations found at least 548 TVs purchased through ClassWallet worth $191,000.
Families also bought pressure washers, car stereo equipment, coffee makers, exercise gear and smart watches.
Isn’t a power washer a school supply?
The Oklahoma legislature just passed a bill guaranteeing the free speech rights of professors and students in Oklahoma higher education. It has been sent to Governor Kevin Stitt for his signature.
The sponsor of HB 3543, Rep. Chad Caldwell, (R)-Enid, said the goal is to protect students who may not have the same viewpoints as their classmates and professors.
“We shouldn’t have a professor worried about getting fired if they say this or that,” Rep. Caldwell said. “We shouldn’t have a student that has to worry about, if I don’t take a Republican view or a liberal view that I’m going to get an ‘F’ on a paper. That shouldn’t be something that’s going on at any of our colleges or universities.”
The legislature apparently forgot that they banned the teaching of “critical race theory” in 2021 and discouraged teaching the facts about the horrific Tulsa Massacre. Kathryn Schumaker, the Edith Kinney Gaylord presidential professor in the department of classics and letters at the University of Oklahoma, wrote at the time that the law banning discussion of racism would make it impossible to teach history honestly on campus.
She wrote in The Washington Post:
The law is aimed at eradicating the supposed scourge of critical race theory (CRT) from state classrooms and campuses, a cause that has become a right-wing talking point over the course of the past few months. Oklahoma educators and academics have denounced the law, noting that it will deter teachers from discussing Oklahoma’s fraught racial past of Native American dispossession, lynching and racial terror.
For example, as we mark the centennial of the Tulsa Race Massacre in late May, state political leaders are making it clear that they would like Oklahomans to leave the past behind. In 2001, a state commission report called for reparations and public recognition of the legacy of the massacre. But this new law undermines efforts to reckon with our collective past, and it will chill classroom discussions of this history. H.B. 1775 instructs educators to emphasize that although the perpetrators of the Tulsa Race Massacre did bad things, their actions do not shape the world we live in — even though White rioters murdered scores of Black Tulsans and destroyed more than 1,200 buildings in the Black Greenwood neighborhood, annihilating decades of accumulated Black wealth.
Meanwhile, a seventh-grade science teacher at Jenks Middle School was fired for refusing to remove a rainbow-colored flag from a display of flags in his classroom.
Oklahoma suffers from a severe case of schizophrhrenia or hypocrisy.
It will be interesting to see what happens when the free speech law is used to defend teaching critical race theory in higher education.
Thanks to John Thompson of Oklahoma for the updates from his state.
Despite the support of Governor Kevin Stitt, a bill authorizing vouchers failed in the Oklahoma State Senate. Most rural Republicans support public schools. Pastors for Oklahoma z children actively opposed vouchers.
A polarizing Oklahoma bill that would dedicate $128.5 million in taxpayer dollars for private school costs failed in a late-night vote on the Senate floor Wednesday.
In a 24-22 vote, a majority of senators nixed Senate Bill 1647, called the Oklahoma Empowerment Act, effectively defeating the bill for this legislative session.
One of the most high-profile pieces of legislation this year, the bill stalled after two hours of debate and two more hours of waiting as Senate Pro Tem Greg Treat, the bill’s author, tried to flip a few Republican holdouts in a last-ditch effort to advance the measure…
Had SB 1647 advanced, it would have faced a difficult road in the House, where Speaker Charles McCall, R-Atoka, said last month he wouldn’t give the bill a hearing.
McCall’s stance hasn’t changed, House Majority Floor Leader Jon Echols told News 9 this week.
“Here’s the bottom line: I’m in favor of parents being able to choose,” said Echols, R-Oklahoma City. “I’m in favor of finding a way to have more parental involvement, but no, this bill is a waste of time this year.
“Speaker McCall’s not going to budge on this. It’s not going to be heard in the House…”
McCall said the bill is a non-starter for rural lawmakers, whose districts have far fewer private-school options. Even with the bill no longer drawing money out of the education funding formula — the multi-billion-dollar pot of state funds supporting public schools — it still struggled to attract enough rural Republicans to pass.
Senate Democrats almost unanimously opposed the measure. State schools Superintendent Joy Hofmeister, a Democratic candidate for governor, celebrated the bill’s failure while claiming it would have “effectively destroyed public schools in Oklahoma.”
John Thompson, historian and retired teacher in Oklahoma, writes about the legislators who are offering bills to undermine public schools, control their curriculum, even meddle with the school lunch program. Their goal is clear: the demoralization of teachers and the destruction of public schools.
Thompson writes:
Why are some Republican legislators in Oklahoma trying to “strip” school lunch programs from the State Department of Education and move them to the Agriculture Department?
The Tulsa World reports:
“The House author told us that some in the Legislature feel too much focus was put on making sure kids were fed during the pandemic and not on educating kids,” said Carolyn Thompson, chief of government affairs and deputy chief of staff at the Oklahoma State Department of Education (SDE).
The author of HB 3432, Rep. Dell Kerbs, claims he wants “to take something off of education’s plate and hopefully move more schools away from ‘heat and serve’ meal options.” But education leaders have said that that is “ridiculous,” and “a solution in search of a problem.” In fact:
The legislation would create duplication within the state’s overall bureaucracy, because their department must still obtain child nutrition data for a host of purposes including calculating state aid funding, school accountability and accreditation, and the federal E-Rate Program that provides schools with discounted telecommunications services.
This new bill should be considered in the light of numerous other anti-education bills filed this session. As The Frontier explained, they are often pushed by national conservative organizations, sometimes using “word-for-word language copied from model legislation.”
For instance, SB 1508, “would require school districts to submit to the State Department of Education detailed expenditure reports on diversity, inclusion and social justice training for teachers and administrators.” HB 3432 also brings to mind bills by Sen. Shane Jett that “would outlaw teaching of social-emotional learning in schools;” “require higher education institutions to post their budget for student and teacher diversity curriculum online;” and “ban voluntary surveys in schools from asking questions about sexuality or gender and would ban school libraries and curriculum from including books that deal with sexuality or gender.”
To understand the purpose of these restrictions, they must also be considered in the context of bills filed by Standridge that “would require teaching ‘patriotic education’” about Oklahoma history; or “impose civil penalties of at least $10,000 on school personnel who teach lessons related to critical race theory [and] require the employee to be fired and blacklisted from educational employment for at least five years.”
Similarly, these bills’ common purpose must also be understood within the context of Sen. Nathan Dahm’s attempt to “require social studies classes to teach at least 45 minutes every Nov. 7 on “Victims of Communism Day;” to “require schools to distribute historical Thanksgiving day proclamations, all of which list the importance and role of Christian faith;” to “add reading requirements for high schoolers that contain some theological themes;” and “require the Oklahoma State Department of Education to contract for curriculum for a four-year pilot project for 11th graders on U.S. history that “narrowly tailors the subject areas to align with free high school curriculum courses from Hillsdale College.”
And, of course these mandates must be seen within the context of successful and unsuccessful bills prohibiting school boards from issuing mask mandates; requiring an “opt in” system for teachers union membership, even though that is already the law; and at a “cost over $116 million” providing “state dollars to students to spend on private school tuition and other education expenses instead of attending a public school.”
To fully understand these vituperative assaults on schools, we must also consider the New York Times’ coverage of the Enid, Ok. school board battles, which concluded: From lockdowns to masks to vaccines to school curriculums, the conflicts in America keep growing and morphing, even without Donald Trump, the leader who thrived on encouraging them, in the White House.
But the fights are not simply about masks or schools or vaccines. They are, in many ways, all connected as part of a deeper rupture — one that is now about the most fundamental questions a society can ask itself: What does it mean to be an American? Who is in charge? And whose version of the country will prevail?
The Times also explained that Enid is in a county which “experienced one of the largest increases in racial diversity in the country over the past decade.” Since 1980, it dropped from 94 percent white to about 68 percent.
And this brings us back to the two, somewhat separate but intertwined agendas that drive these education bills. The corporate establishment and the leaders of the Trump wing of the Republican Party see both political threats and opportunities in demographic change. In the short-run, in order to keep their majority, they must use gerrymandering (such as moving one of the most progressive areas in Oklahoma City into the Panhandle’s congressional seat hundreds of miles away) and reverse trends that expanded the opportunities to vote. But these demographic changes give them better chances for winning in 2022 and 2024 by stoking the fears of Oklahomans who see themselves as being replaced by immigrants, other people of color, and new generations of progressives.
All of these education bills, primarily, are fact-free, fear-based campaigns to win elections at any costs. Being a Baby Boomer who saw the damage done to schools by McCarthyism, and how it persisted into my K-12 education and even into my teaching career, I worry about the long-term effects of these scorched earth campaign tactics.
The second, overarching theme is privatization. Whether it is Gov. Stitt’s undermining of public health institutions as we entered the Covid crisis, privatizing Medicaid, or disempowering the Pardon and Parole Board by preventing them from considering evidence of innocence in their deliberations, or wrecking public education, they want to dismantle governmental institutions.
Whether all of the legislators who support these bills understand it or not, the real goal is kicking vulnerable school systems that are exhausted by the Covid crisis while they are down. Then, rightwingers can ramp up their efforts to fund their cronies, while claiming that the Free Market will find replacements for what they call a rotten, socialist system that doesn’t respect their political base.
Finally, as I was about to submit this post, the New Yorker arrived, featuring Jill Lepore’s The Parent Trap. Lepore also describes the efforts of many Republicans as “whipping up a frenzy about parents’ rights” to win the mid-term and, perhaps the presidential elections. But she then goes back a century to the Scopes Trial, which also followed a global pandemic; explains the racist roots of the anti-evolution campaigns; and the Scopes aftermath, with “’purging’” libraries and “’hounding’” teachers.
Now, the campaign includes the “highhandedness, moral crusading, and snobbery” of today’s corporate reformers’ school choice movement. Lepore concludes, “It’s still going on today.” Some activist parents seem to “want to destroy public education.” So, everyone should read how this isn’t just a brutal fight in Oklahoma Red State politics, but “another long game, a hundred years war: the campaign against public education.”
The Governor and the leader of the Oklahoma State Senate are enthusiastic about a voucher bill but the Speaker of the House said the bill won’t get a hearing.
It seems that rural districts don’t want vouchers. This has been the case in Texas, where rural Republicans have repeatedly joined with urban Democrats to kill vouchers. Pastors for Texas Children organized against vouchers in their state, and so did Pastors for Oklahoma Children.
OKLAHOMA CITY (AP) — A proposal endorsed by Oklahoma’s governor and Senate leader to allow public school funding to follow students to private schools or home schools won’t be heard in the House, Speaker Charles McCall said Thursday.
“I don’t plan to hear that bill this year, and I’ve communicated that,” McCall, R-Atoka, told reporters at a legislative forum hosted by The Associated Press and the Oklahoma Press Association.
“That topic is just not on the radar or the minds of our members as a priority,” McCall said. “It’s never been discussed in our caucus retreat as a priority of our members.”
The proposal is a priority for Senate President Pro Tempore Greg Treat, and Gov. Kevin Stitt endorsed the idea Monday in his State of the State address to the Legislature, saying it would make the state a national leader in school choice.
“We know education is not one-size-fits-all, and I pledge to support any legislation that gives parents more school choice, because in Oklahoma, we need to fund students, not systems,” Stitt said Monday.
But the idea has faced bipartisan opposition in the Legislature, particularly from members who represent rural districts where there are few private school options for students.
“It’s a bit of geographical issue,” said McCall, whose district in southeast Oklahoma includes towns like Atoka, Davis, Mannsville and Tishomingo. “He (Treat) is a suburban Oklahoma guy. I’m a rural Oklahoman. We see things through the lens of our individual districts.”
Inspired perhaps by the anti-public school rhetoric of Betsy DeVos or funded perhaps by billionaire Charles Koch or encouraged by Trump’s white evangelical base, Oklahoma Republicans are proposing a bill that would crush public schools.
Not content to open more privately managed charters or to offer more vouchers to disgruntled parents, Republicans want to use public money to pay for whatever parents want to do. Jeanne Allen of the pro-privatization Center for Education Reform has for many years referred to this approach as a “backpack full of cash.” Give parents the money that previously went to public schools and let them decide whether to spend it on home-school, charters, vouchers, computers, tutors or whatever.
Jennifer Palmer of Oklahoma Watch writes that the ultimate goal of this approach is to abandon the state constitution’s pledge to support a public school system, replacing it with a ragtag array of choices. She doesn’t say it, but I will. This plan, if enacted, will undermine the quality of education in the state and set back the education of Oklahoma’s children. Instead of improving schools, it will turn the money for public schools into a grab bag.
She writes:
Of the 2,300 bills filed by state lawmakers for the upcoming session, which starts Monday, the one I will be watching most closely is Senate Bill 1647 by Senate leader Greg Treat. He’s calling it the Oklahoma Empowerment Act.
The legislation would create universal vouchers by giving any parent a state-funded account for their child’s education.
The funds could be used on private school tuition, homeschool expenses, tutoring, books, computers, supplies, transportation to school and many other qualifying expenses. The effect would be moving public funds to private entities lacking in accountability and transparency.
The bill envisions each student in the state with a backpack full of money and carrying it to the educational options their parents choose. It’s similar to Epic Charter School’s learning fund but on a much larger scale (and Epic’s learning fund is under audit for possible misuse of public funds for private gain by the school’s co-founders.)
Groups advocating for school choice, like ChoiceMatters and Every Kid Counts Oklahoma (whose executive director is Ryan Walters, secretary of education and a candidate for state superintendent), champion the idea with slogans like “fund students, not systems.” The mantra is also repeated by Yes. every kid., a social welfare organization started by Charles Koch, the billionaire owner of Koch Industries…
The Oklahoma State Constitution says: THE LEGISLATURE SHALL ESTABLISH A SYSTEM OF FREE PUBLIC SCHOOLS WHEREIN ALL THE CHILDREN OF THE STATE MAY BE EDUCATED.
The Legislature is specifically charged with maintaining a system of public schools. The bill, if passed, could be challenged on these grounds.
That’s not the only concern I’m hearing. As written, there is no testing requirement for students in the bill, which is required by most other states with voucher programs, according to a2021 comparison by the Education Commission of the States.
That means there would be little way for the public to ascertain the quality of the education these students are receiving. Oklahoma already has the most lax homeschool law in the country, and private schools report almost no data, even when they receive funds through the current school choice programs: the Lindsey Nicole Henry Scholarship Fund and the Oklahoma Equal Opportunity Education Scholarship program.
Treat’s bill does not prohibit private schools from discriminating against students if they are LGBTQ or pregnant or for a number of other reasons (private schools can’t, though, discriminate on the basis of race if they are tax-exempt.) The proposal states an education provider “shall not be required to alter its creed, practices, admissions policy, or curriculum” to accept payments from the program.
Treat, recognizing the sure-fire opposition to this proposal, in a video with ChoiceMatters last week said: “There’s going to be plenty of criticisms to hear. Just put on the armor. Get ready for the fight. It’s going to be a fight. But our kids are worth it.”
So says the legislator whose plan violates the state constitution, destroys the state’s public schools, and guarantees that the quality of education will sharply decline as the grifters and religious zealots make their pitch for taxpayer dollars.
Fraud, scandal, embezzlement, failure: Nothing can slow the Republicans’ demand for charters and vouchers. The latest example of charter failure comes from Oklahoma, where the state auditor of Oklahoma reviewed the finances of the Epic charter schools and declared it was the worst abuse of taxpayer funds in the history of the state. And as yet there have been no consequences.
Oklahoma’s state auditor and inspector on Tuesday said mismanagement by co-founders of Epic Charter Schools is “the largest amount of reported abuse of taxpayer funds in the history of this state” — and she has no idea why the attorney general has not brought criminal charges in the case.
“I am shocked this hasn’t been prosecuted yet,” State Auditor Cindy Byrd told lawmakers at a joint meeting of the Oklahoma House of Representatives’ common education committee and Appropriations and Budget education subcommittee. “I do expect charges to be filed — or an explanation for why charges will not be filed….”
Byrd, a Republican serving her first term in elected office, noted that she accepted no campaign funds from education political action committees and has nothing against charter schools, parent choice in education or even free market enterprise.
She likened charter schools like Epic, which she described as “intentionally established” for charter school management companies to milk for profits — as the “Enron of public education.”
Diane Ravitch's blog 