FBI Cracks Down on Fraudulent Charter Schools

Thursday, August 21, 2014
Ron Packard

An education movement that began as a way to provide parents with more schooling choices for their children has become a lucrative industry noted for exorbitant executives’ salaries and, in many cases, fraudulent business operations that have drawn the attention of the Federal Bureau of Investigation (FBI).


Charter school investigations have been launched by FBI agents in Illinois, Connecticut, Louisiana, Pennsylvania, New Mexico and other states with the purpose of uncovering illegal activities by those running such schools.


Some of the investigations are being jointly operated with the U.S. Department of Education, whose inspector general is also reviewing accusations that local charter schools have been less about educating children than making money.


“Education entrepreneurs and private charter school operators could care less about innovation,” Kristen Buras, associate professor of education policies at Georgia State University, told Ruth Conniff of The Progressive. “Instead, they divert public monies to pay their six-figure salaries; hire uncertified, transient, non-unionized teachers on-the-cheap; and do not admit (or fail to appropriately serve) students who are costly, such as those with disabilities.”


Sometimes even a six-figure salary isn’t enough. Ron Packard, who until early this year was CEO of charter school operator K12, made $4.1 million in 2013, according to Conniff. K12 has been accused by the state of Florida of attempting to falsify records, using unqualified teachers, and booking classes of more than 100 students. The company is also a member of the American Legislative Exchange Council (ALEC), and has helped promote legislation that would replace schools with remote learning and virtual teachers.


Other ALEC proposals include exempting charter school teachers from state certification requirements and giving charter school corporations the right of first refusal to purchase unused school buildings below cost and without paying taxes and fees.


Other federal investigations have centered on the secretive nature of charter companies, including the nation’s largest, run by Turkish Islamic cleric Fethullah Gulen. Gulen’s 120 schools in the United States, which are secular, have been accused of bringing teachers in from Turkey, using public funds to pay contractors linked to Gulen despite lower bids from others, and refusing public records requests, according to The Atlantic.

-Noel Brinkerhoff, Steve Straehley


To Learn More:

FBI Raids of Charter School Operators Jump (by Ruth Conniff, The Progressive)

Nearly $1 Million from Charters Went to Firms Named in FBI Probe (by Dan Mihalopoulos, Chicago Sun-Times)

120 American Charter Schools and One Secretive Turkish Cleric (by Scott Beauchamp, The Atlantic)



Matt D 9 years ago
Sounds to me like Jeff Kwitowski is on the K12, inc payroll. K12, inc does not officially run charters, but they do contract to run charters including hiring of staff, financial management and all other aspects. If the FBI is looking into charters run by K12 then the FBI is looking into K12. Personally, I hope K12 goes down in flames. The American education system has problems, but companies like K12 are not the answer.
Jeff Kwitowski 9 years ago
Referencing K12 and Mr. Packard in this story strongly suggests that one or both are targets of these apparent investigations – an implication that is both totally inaccurate and misleading. K12 is a vendor to thousands of school districts and schools. It is a technology-based education company, NOT a charter school. K12 does NOT hold charters, nor is it being investigated. K12 Inc. and Mr. Packard’s publicly reported compensation is wholly irrelevant to this story. The suggestion that Mr. Packard and K12 are somehow related to these apparent investigations is baseless and entirely misleading. Additionally, the reference to K12 in Florida is missing the most important fact: the claims against K12 were unfounded. Last year, the FL Department of Education’s Inspector General concluded that the allegation made by one Florida school district that K12 used non-state-certified teachers was unsubstantiated. K12 teachers serving public schools in Florida are state-certified. Florida has authorized K12 as a state-approved provider and K12 is in full compliance with all state requirements. It's unclear whether the insinuations about K12 were intentional or unintentional, or whether the writers were aware of the facts. Either way, corrections are warranted.

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