Diane Ravitch’s Blog: Report: More than $200 Million in Charter School Waste, Fraud, and Mismanagement is “Tip of the Iceberg”

The Center for Popular Democracy and the Alliance to Reclaim Our Schools reviewed reports of financial abuses by charter schools and concluded that more than $200 million in state and federal funds have been squandered. They examined records in only 15 states and estimate that what they discovered is only “the tip of the iceberg.” Most financial scandals and frauds come to light only after a whistle-blower speaks out or a state agency audits charter schools or an enterprising journalist digs into charter records. Many state laws governing charter schools confuse “flexibility” with a lack of oversight. Charter schools receive public money yet have gone to court to prevent public audits by state officials.

The report says that “According to standard forensic auditing methodologies, the deficiencies in charter oversight throughout the country suggest that federal, state, and local governments stand to lose more than $1.4 billion in 2015. The vast majority of the fraud perpetrated by charter officials will go undetected because the federal government, the states, and local charter authorizers lack the oversight necessary to detect the fraud.”

The report is alarming. Even more alarming is that the Obama administration intends to increase charter school funding by nearly 50% despite the absence of adequate supervision and oversight to prevent fraud.

Legitimate charter schools, serving students with high needs, should be first to expose the hucksters.

Regulations exist for a reason: to protect children and the public from fraudulent, unqualified, and incompetent operators who will prey upon them and profit because of the absence of oversight. How long will the public continue to tolerate this laissez faire approach to an industry that siphons money away from public schools without any accountability?

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Diane Ravitch

Diane Ravitch is Research Professor of Education at New York University and a historian of education. She serves on the board of the Core Knowledge Foundation, Common Core, the Albert Shanker Institute of the American Federation of Teachers, and Common Good. She is an honorary life trustee of the New...