Wednesday, March 22, 2006

Philadelphia Charter School Principal Charged with Fraud

The former principal of a charter school in Southwest Philadelphia was indicted on six counts of wire fraud related to submitting inflated student enrollment figures to obtain additional funding.  The school closed abruptly in June 2003, before the end of the school year, when its charter was not renewed, and a federal investigation had began shortly before that.  According to a press release issued by the U.S. Attorney's Office for the Eastern District of Pennsylvania (here):

As the principal of CEL, Andrews engaged in a scheme to defraud the School District by causing falsely inflated student enrollment data to be submitted to the School District, thereby causing the School District to provide funding to CEL to which CEL was not entitled. As Andrews knew, limitations in the School District’s computer network prevented the School District from knowing that a student had left CEL, where that student had transferred to another school outside of the School District (such as a parochial school or a school outside of Philadelphia) or had dropped out of school altogether. Andrews exploited these limitations in the School District’s computer network by directing his staff to report to the Network that students who had either transferred to another school outside of the School District, or dropped out of school altogether, continued to attend CEL, when in fact as Andrews knew, these students did not attend CEL. As a result of the defendant’s scheme to defraud, the School District overpaid CEL approximately $200,000 in public education funds.

It is not clear from the press release whether Andrews is accused of personally enriching himself from the alleged fraud.  For those wondering about the name of the school, CEL stands for "Center for Economics and Law."  The school focused on law, economics and entrepreneurship, and this case would have served as a good object lesson for the application of the law. A Philadelphia Inquirer story (here) discusses the indictment. (ph)

http://lawprofessors.typepad.com/whitecollarcrime_blog/2006/03/philadelphia_ch.html

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