Perdido 03

Perdido 03

Sunday, November 30, 2014

Audit Analysis Finds New York Charter School Sector Rife With Fraud

Ben Chapman in today's Daily News:

New York State charter schools have made more than $28 million in questionable expenditures since 2002, according to a new review of previous audits of the publicly funded, privately run schools.

The Center for Popular Democracy’s analysis charter school audits found investigators uncovered probable financial mismanagement in 95% of the schools they examined.

Kyle Serrette, executive director of the progressive, Washington-based group, said the review of previously published audits showed the schools need greater oversight.

“We can’t afford to have a system that fails to cull the fraudulent charter operators from the honest ones,” said Serrette. “Establishing a charter school oversight system that prevents fraud, waste and mismanagement will attack the root cause of the problem.”

An oversight system for charter schools in New York State?

Ha, that's a laugh.

You can literally lie about everything other than your birth date on your application as head of a charter school and the New York State oversight entities (the Board of Regents and NYSED) won't catch you.

Even after your caught, no one at the oversight entities will take responsibility for giving charter approval to a fraudulent lead applicant - they'll instead try and pass the buck to one of the other entities.

The political establishment will make excuses for the fraudulent behavior, minimizing it is a "mistake" instead of the criminal behavior it is.

And the school will STILL open, despite it's birthing by a fraudster, so long as said fraudster "resigns" from the board of trustees.

Chapman's Daily News article comes at a sensitive time for charters because they are looking to increase or eliminate the charter cap in the spring but are having to live down the "Dr" Ted Morris Jr. fraud fiasco I referenced above as Exhibit A for why charters are a problem.

And now comes this:

The state controller’s office and state Education Department have audited 62 of New York’s 248 charter schools, according to Serrette’s report. All told, Serrette’s group estimates wasteful spending at charters could cost taxpayers more than $50 million per year.
Eighteen audits targeted charters in New York City, representing about 9% of the 197 charters in the five boroughs. Each audit found issues.
  • A 2012 audit found Brooklyn Excelsior Charter School was paying $800,000 in excess annual fees to the management company that holds its building’s lease.
  • A 2012 audit of Williamsburg Charter High School revealed school officials overbilled the city for operations and paid contractors for $200,800 in services that should have been provided by the school’s network.
  • A 2007 audit of the Carl C. Icahn Charter School determined the Bronx school spent more than $1,288 on alcohol for staff parties and failed to account for another $102,857 in expenses.

And that's just what's been found with financial audits.

Imagine top to bottom investigation of charter practices, including state test scores (which are self-graded at high school charters), attrition rates and special education services.

There's a reason Eva Moskowitz sued to keep audits from happening at her charter chain (and won that suit, though that victory came before changes to the auditing procedures in last spring's state budget agreement.)

There's a reason why the charter school sector is in the game to sue the city and state comptrollers to limit the audits that were decreed legal and necessary by last year's budget agreement.

They don't want anybody looking into them because they understand the charter sector is a Wild, Wild West industry where pretty much anything goes.

If that isn't obvious after the "Dr" Ted J Morris Jr fraud fiasco, I don't know what it is.

But it's even more true after these the Center For Popular Democracy's audit analysis.

The key takeaway from Ben Chapman's DN story is:

Eighteen audits targeted charters in New York City, representing about 9% of the 197 charters in the five boroughs. Each audit found issue...investigators uncovered probable financial mismanagement in 95% of the schools they examined.

Not every charter was audited but every charter that was audited had issues.

What that says to me is, it's time to target every charter school for auditing.

And since neither oversight body at the state level (the Regents or the NYSED) managed to catch the fraud of "Dr" Ted J Morris Jr, the con man who claimed to have a BA, an MA, a Ph.D, and an MSW (he may not even have a high school diploma), the state and city comptrollers need to be the leads on these audits.

When the oversight bodies that are supposed to hold charters accountable don't care to do their jobs and make excuses for a lack of oversight when fraud is exposed via the news or blogosphere, it means those oversight entities should no longer have oversight responsibilities.

The aggressively pro-charter Regents Chancellor Merryl Tisch and the former charter school founder NYSED Commissioner John King are part of the problem with charters, not part of the solution.

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