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Massive charter school fraud scheme in San Diego leads to new multi-agency task force

Posted at 9:37 PM, Nov 27, 2023

SAN DIEGO (KGTV) — A new multi-agency statewide task force designed to protect public education money following a massive charter school scandal held its first meeting on Monday.

California is home to more than 1,300 charter schools, more than any other state.

On Monday, San Diego County's district attorney, the California State Controller, and other law enforcement and education leaders announced the goals of the new task force during a press conference at the Logan Memorial Educational Campus.

"Every dollar stolen from them is a crime, and in this case, it was a crime of an epic level," said San Diego County District Attorney Summer Stephan.

Stephan is referring to a charter school scam that led to the theft of roughly $400 million of taxpayer money from 2016 to 2019.

"This was the home of the case that unraveled the most massive fraud scheme targeting education dollars in the United States," said Stephan.

The DA says 11 people, including two former superintendents, were involved in that scheme.

Prosecutors say Sean McManus and Jason Schrong were the ring leaders.

The two created the A3 charter school network of 19 online schools. According to the indictment, the pair bought student information and then falsely enrolled the kids in the schools to get state money. Under a deal, they pleaded guilty to felony conspiracy charges and returned roughly half of the stolen money.

The California state controller, law enforcement, and education leaders say the new task force will take a closer look at the role of auditors.

"One of the key failures in the system is that the auditor who is supposed to be minding the money and the business of our students and schools is really controlled by the very fraudsters who are running the operation," said Stephan.

"The objective of the task force is to examine audit functions of the charter school system, develop comprehensive guidelines to promptly identify any other fiscal improper issues," said state controller Malia Cohen.

The task force will announce recommendations in June.