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New report estimates $54 million in charter school fraud in New York state in 2014

NEA President Lily Eskelsen García: ‘Charter school advocates continue to push for an elimination of caps yet refuse to install real oversight in charter schools to prevent fraud’


WASHINGTON - December 01, 2014 -

In its recent series of state-specific reports exposing millions of dollars in suspected charter industry fraud, the Center for Popular Democracy (CPD) continues to uncover massive oversight deficiencies and financial irregularities. CPD’s latest installment, released with the Alliance for Quality Education, estimates as much as $54 million in suspected charter school fraud in 2014 in New York state, which has spent $1.29 billion in public funding for New York City charter schools alone.

Despite the tremendous investment of public dollars, New York has failed to implement a system that adequately monitors charters for fraud, waste and mismanagement, according to the CPD report. While charter schools are subject to reporting requirements and monitoring by oversight bodies, only the New York State Comptroller’s Office audits charter schools with any regularity. The office audited only 51 charter schools in the past five years, out of the more than 200 charter schools in the state.

“These findings are truly disturbing,” said NEA President Lily Eskelsen García. “While some charter school officials spend tens of thousands of public dollars on staff trips to the Bahamas from funds diverted from traditional public schools, New York state’s 90,000 charter school students may not be getting the resources they need and may be missing out on the great education these corporate charter school companies promised.”

Charter school advocates continue to push New York City Mayor Bill DeBlasio to raise or eliminate caps on charter schools so that even more New York schools can be handed over to charter school operators.

“The audacity of some of these operators—to push for more taxpayer dollars while mismanaging the funds they’ve already received—is really astonishing,” said Eskelsen García. “Everyone knows that oversight doesn’t happen when an entity is policing itself. If New York state is going to continue to allow hundreds of charters to exist within its borders, legislators need to commit the resources to provide regular audits and real oversight. It’s ridiculous to consider lifting charter school caps until operators have a firm oversight structure in place and are transparent with their expenditures and practices.”

CPD recommends that the state of New York’s oversight agencies, including the Comptrollers’ offices for New York state and New York City, conduct targeted fraud audits on charter schools once every three years. The state should also impose a moratorium on new charter schools and refrain from increasing the charter school cap until the state oversight system is adequately reformed.

CPD “is shining a spotlight on multiple charter school operators and we’re seeing a sad trend form in terms of corrupt practices,” said Eskelsen García. “Parents and communities deserve to know an operator’s history when considering whether to send their children to these schools. They also deserve transparency so they know what their tax dollars are being spent on, and more importantly, what their money is not being spent on—students.”

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The National Education Association is the nation's largest professional employee organization, representing nearly 3 million elementary and secondary teachers, higher education faculty, education support professionals, school administrators, retired educators, and students preparing to become teachers.

CONTACT: Sara Robertson  (202) 822-7823, srobertson@nea.org


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