Well, here is another black eye for charter schools. For everyone of these cases in which an administrator blatantly steals from a school, there are hundreds of cases of successful charter schools. Unfortunately, the good schools don't get the news while the bad schools attract nationwide attention.
This means that all charter schools who want to maintain a good reputation need to be extra careful. It also means that charter leaders should not be surprised when new laws for financial transparency or for increased training for charter school leaders and board members arise.
While it's pretty clear from other writing in this blog, that we aren't in favor of big government or huge amounts of regulation, we also recognize and respect the fact that charter schools are using public money. We believe that the whole point of charter schools is to do a better job with public money than our counterparts. If we don't, then there is little reason for charter schools.
If charter school leaders to not rise above the steep learning curve that I outlined yesterday, then these types of activities will continue and charter schools will continue to have to answer for their unethical siblings.
I'm not sure there is an easy way to stop illegal use of school funds before it happens, but if boards reviewed financial statements and insisted on good internal controls, these cases would become fewer and fewer. Charter schools do not have enough money for someone to steal $1 million without someone noticing (if they are paying attention). Charter school board members must understand the budget and understand where the money is going, especially when we get into $100,000 plus expenditures.
Board members, if you aren't a financial person, figure it out. Get some training. Get someone or someones on your board who do have financial training. Find a financial manager who isn't the director's best friend. Eliminating fraud is not easy if someone really wants to hide it, but there are steps to take to reduce the opportunity. Look into them and implement them.
2 comments:
Where was the charter school's authorizer in all this? Shouldn't they have been receiving regular financial reports and audits that should have brought this to light much sooner?
Gideon, I agree. The authorizer should have been paying attention to this. I really don't see how anyone paying attention could miss such large sums of money. On the other hand, if the expenditures were budgeted, financial reports would appear to be OK. It's hard to say without more details. It happened over a couple of years, which means that auditors could/should have caught it as well.
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