Dorothy June Hairston Brown, Philadelphia Charter School Mogul, Charged With Defrauding $6.5 Million In Tax Dollars

Philly Charter School Mogul Charged With Multi-Million Dollar Fraud

Philadelphia charter school mogul Dorothy June Hairston Brown was charged Tuesday -- along with four colleagues -- with defrauding three charter schools of more than $6.5 million in tax dollars.

Brown and her executives were indicted on 62 counts of wire fraud, obstruction of justice and witness tampering. She had earned praise for student test scores and had a reputation for claiming large salaries and filing suits against parents who questioned her, the Philadelphia Inquirer reports.

Brown founded three Philadelphia charter schools: the Laboratory, Ad Prima and Planet Abacus. She also had a hand in creating the Agora Cyber Charter School, which offers online lessons to students across the state. Brown was reportedly paid $150,000 for working 30 hours weekly at Laboratory and $115,904 for a single week at Ad Prima.

"Charter schools are funded with public money that is intended to help educate children in our communities," Special Agent in Charge George C. Venizelos of the Philadelphia Division of the FBI said in a statement. "When individuals misappropriate those funds, as this indictment today alleges, they trade our children's education and our children's future for their own illegal profit."

Among numerous other falsifications and infractions, Brown and a colleague founded a private, limited liability company that collected "millions of dollars in 'management fees' from Agora while providing little or no services to Agora," according to court documents.

"Public education is a cornerstone of American life which has provided many with the tools for future success," said U.S. Attorney Zane David Memeger said in an FBI statement Tuesday. "As our public schools are funded through dollars earned by hard working Americans, there is a reasonable expectation that their tax dollars will be used to actually educate students. The indictment in this case alleges that June Brown and her four co-conspirators used the charter school system to engage in rampant fraud and obstruction. My office will continue to vigorously investigate and pursue those charter school operators who defraud the taxpayers and deprive our children of funds for their education."

The Pennsylvania Department of Education filed suit in 2009, discontinuing payments to Agora because of "ongoing and pervasive unlawful and improper conduct" in misusing taxpayer funds.

The Department of Education's charter issued to Agora prohibited the school from using an external management association, a provision state officials said Agora violated by contracting Brown's private company, which was "disproportionately rewarded for little or no performance."

A December report by the New York Times revealed that nearly 60 percent of Agora's students were not at grade level in math, while almost 50 percent were behind in reading. About one-third of those students didn't graduate on time.

In spite of this, Agora represented a "remarkable success that has helped enrich K12 Inc.," the public management company that is also the largest in the online schooling industry. Agora was expecting a $72 million income for the most recent school year.

Brown's case isn't unique. Cyber charter school funding in Pennsylvania has become an increasingly hot-button issue, as cyber charters receive funding for studentsat a cost to the local school district based on the average cost to educate that pupil -- even though educating that student online costs an average $3,000 less than in a physical school.

FBI agents earlier this month raided the office of Pennsylvania Charter Cyber school founder Nick Trombetta under suspicion that he misused state tax dollars to fund his out-of-state ventures. The school enrolled more than 11,300 students in the latest academic year, and critics say that the $10,000 the school receives from the state per pupil far exceeds the cost of an online education.

Pennsylvania's Frontier Virtual Charter High School, which promised students internship opportunities and language learning, recently closed after just a year of operation. The state Department of Education filed court documents revoking the school's charter as students were regularly truant or failing.

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