Report: PA charter schools defrauded $30 million from taxpayers

Three activist groups say Pennsylvania charter schools have defrauded at least $30 million intended for school children in the state since 1997, because of flaws in oversight from state agencies.

The Center for Popular Democracy, Action United of Philadelphia and Pittsburgh and Integrity in Education released the report Wednesday. All three are nonprofits that advocate for education.

The groups call on the state Attorney General’s Office to look for fraud in all Pennsylvania charter schools. They also want a temporary moratorium on new charter schools, saying oversight agencies are failing to monitor the 186 charter schools in the state.

From The Philadelphia Inquirer:

“[The report] asks the legislature to require charters to undergo regular fraud-risk assessments and fraud audits. And it suggests that until the law is changed to require such actions, charters should voluntarily undergo them and make the findings public.

Researchers said most of the $30 million in fraud that has been detected since the state's charter law was passed in 1997 was not uncovered by charter-oversight offices but by whistleblowers and the media, including The Inquirer. They said the total amount of misspent funds was likely far larger.”

School districts in Pennsylvania paid $1.5 billion to charter schools that enrolled 128,712 students in 2012-13, according to the Philadelphia Inquirer.

According to the report, charter school enrollment in the state has doubled three times since 2000.

The report laid out instances of fraud where charter school owners used school funds for home improvements, to buy airplanes and to support a restaurant. Instances included cases where charter school officials were indicted or pleaded guilty to fraud charges.

From the Inquirer:

Examples include Nicholas Trombetta, founder and former CEO of the Pennsylvania Cyber Charter School in Midland, who is awaiting federal trial in Pittsburgh on charges that he diverted $8 million in school funds for personal use.

The tally also includes $6.3 million that federal prosecutors allege Dorothy June Brown defrauded from the four Philadelphia-area charters she founded.

The report said Pennsylvania charter schools are exposed to fraud because school districts and state agencies that are supposed to provide oversight are understaffed and staff members lack training.

Reach Natasha Khan at 412-315-0261 or nkhan@publicsoure.org. Follow her on twitter @khantasha.