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Report: Charter schools have lost $30 million since 1997

Times Online - October 2, 2014, by JD Prose - A day after Pennsylvania Cyber Charter School founder Nick Trombetta was in a federal courtroom as part of his ongoing criminal case, a new report cited him as an example of $30 million in fraud and financial mismanagement among Pennsylvania charter schools since 1997.

The report, “Fraud and Financial Mismanagement in Pennsylvania’s Charter Schools,” was done by three organizations, the Center for Popular Democracy, Integrity in Education and Action United.

It piggybacks on a national report on charter schools in May by the Center for Popular Democracy and Integrity in Education that claimed more than $136 million has been lost to waste, fraud and abuse by charter schools.

The Pennsylvania Coalition of Public Schools issued a statement saying allegations of fraud must be investigated.

“However,” the statement continued, “the report draws sweeping conclusions about the entire charter sector based on only 11 cited incidents in the course of almost 20 years, while ignoring numerous alleged and actual fraud and fiscal mismanagement in the districts over the same time period, which dwarf the charter school allegations in terms of alleged misuse of taxpayer dollars.”

To stem the loss of tax dollars by charter schools, the three nonprofit organizations make several recommendations, including annual fraud risk assessments, trained forensic auditors doing reviews, charter school authorizers doing comprehensive reviews every three years instead of every five years, and charter schools posting findings of internal assessments.

City and county controllers should also be authorized to perform fraud risk assessments and fraud audits on charter schools, the groups recommended.

They also suggested that the state attorney general’s office review all charter schools in Pennsylvania, that the Legislature pass a law to protect and encourage charter school whistle-blowers, and that the state declare a moratorium on new charter schools until reforms are implemented.

Trombetta, who faces 11 federal charges, including mail fraud and filing false tax returns, is cited as one example in the report. On Tuesday, he was in court trying to get recordings tossed in the case, in which he is accused of using various offshoots of PA Cyber to siphon away millions of taxpayer dollars.

The coalition said the report’s recommendations should be applied to traditional school districts as well as charter schools “in the name of intellectual integrity.” If not, it would just be an example of pursuing a political agenda, the coalition said.

Not surprisingly, the president of the National Education Association issued a statement trumpeting the report’s findings and blasting charter school supporters, especially Gov. Tom Corbett. “It’s time for lawmakers to stop providing charter industry players a blank check with little oversight and no accountability,” said Lily Eskelsen Garcia.

“Pennsylvania Gov. Tom Corbett and other politicians in the state continue to push for privatization, despite compelling evidence of fraud and abuse of taxpayer funds in the charter school industry,” Garcia said.