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Latimer County News-Tribune

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Latimer County News-Tribune

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 McCurtain Daily Gazette

Aug
23

2019

Page
002
Clip
Investigators raid
online Oklahoma
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charter school’s vendor

OKLAHOMA CITY (AP)
— State investigators have
raided a vendor for an online
Oklahoma charter school
whose enrollment, funding
and some of its leaders are at
the center of an investigation.
Agents from the Oklahoma
State Bureau of Investigation
searched the home of a man
who runs a nonprofit that
works with Epic Charter
Schools to provide coaching
services for sports. The search
warrant affidavit filed
Wednesday raises new allega-
tions of embezzlement, for-
gery and other violations
against Epic co-founder and
former superintendent David
Chaney, chief financial officer
Josh Brock, and two present
and two former board mem-
bers.
No charges have been filed,
and Epic and its leadership
have denied any wrongdoing.
Epic attorney Chuck
Richardson said the school
and its officials will continue
to cooperate with investiga-
tors.
The State Bureau of
Investigation declined com-
ment

orig.pdf 1 26-Aug-19 19:50:42

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Durant Daily Democrat
Epic school, or epic fail?
BY DAVID BLATT
OkPolicy.org
It has not, to put it mildly,
been a good couple months
for David Chaney and Ben
Harris, co-founders of Epic
Charter Schools, Oklaho-
ma’s largest virtual charter
school.
Launched in 2011, Epic
has enjoyed explosive
growth. It enrolled over
21,000 students in 2018-19,
making it larger than the
state’s fifth largest school
district. It operates online
programs statewide and
three centers that blend
virtual and in-person
learning in Oklahoma City
and Tulsa.
Epic’s growth has been
fueled by aggressive mar-
keting campaigns, bonuses
and gifts to help recruit
students, and teacher
contracts with bonuses
that allow its highest-paid
teachers to reach annual
pay of over $100,000. This
growth has now attracted
intense scrutiny of its busi-
ness model and operations.
In June, Oklahoma
Watch reported on a
Property of OPS News Tracker and members of the Oklahoma Press Association.
lawsuit filed by several
Epic teachers alleging that
the school has, for years,
encouraged teachers to
push for the withdrawal of
low-performing students
to help improve its perfor-
mance measures.
A week later, an Okla-
homan article revealed
that over one-quarter
of Epic’s students were
automatically disenrolled
for missing ten consec-
utive school days, more
than double the statewide
average, a pattern that also
artificially aids the school’s
assessment on annual A-F
report cards. Even so, Epic
high school received an F
in overall performance on
their 2018-18 school report
card, while the middle
school earned a C and ele-
mentary school earned a D.
Next came a press
release from State Sen.
Ron Sharp questioning
why Epic’s blended charter
school have received state
funding allocations for
grade levels the school has
acknowledged it did not
provide instruction for over
two years.
Then most dramatical-
ly, in July, the Oklahoma
State Bureau of Investi-
gation filed an affidavit
against Chaney and Harris
alleging them of embez-
zling more than $10 million
between 2013 and 2018. The
main accusations involve
enrolling “ghost students,”
some of whom are also
home-schooled or attend-
ing private schools. Epic is
also being investigated by
the FBI and federal Depart-
ment of Education. Chaney
and Harris have benefitted
through their control of
Epic Youth Services, a
for-profit affiliate that re-
ceives 10 percent of Epic’s
total revenue to provide its
management services – an
amount now exceeding $11
million a year.
So far no criminal
charges have been filed
and Epic has strenuously
denied all accusations of
wrongdoing.
Until recently, the
Legislature and State
Department of Education
have been slow to enact
appropriate oversight and
accountability over Epic
and other virtual charter
L
i
d
r
schools, but this year saw o
passage of HB 1395 that p
will hold virtual char- m
ter schools to the same t
financial reporting require- t
ments as brick and mortar F
schools. It also requires
charter management orga- a
nizations like Epic Youth m
Services to detail how it o
spends money on behalf of d
the school and adds some o
additional safeguards. We F
can expect the 2020 legisla-
s
tive session to include ad-
e
ditional reform measures,
including efforts to either t
abolish the Statewide
Virtual Charter School p
Board or place it under T
the authority of the State
Department of Education. k
We are also seeing more
public school districts
c
develop their own virtual
s
alternatives. Recently, the
Cooperative Council for p
Oklahoma School Adminis- e
tration launched the Blend-
ed Learning Framework, t
which includes guidelines t
for selecting and training
teachers, recommendations c
T
SEE EPIC, PAGE 7 p
 Durant Daily Democrat

Aug
EPIC
24 CONTINUED FROM PAGE 3
2019

Page
A07 for identifying students
Clip
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126%
From blended/virtual envi-
A03
ronment, and guidelines
for choosing beneficial
technology resources.
High demand for virtual
and blended education
suggests they fill a need
to serve students who
don’t respond well in
traditional classroom
settings. But the lesson of
Epic suggests that when
schools are operated as
profit-making ventures,
the interest of students
won’t come first.

Blatt is Executive Director of

Oklahoma Policy Institute,
okpolicy.org

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 Muskogee Phoenix

Aug
24

2019 State probe of Epic expands to CFO, board

By Jennifer Palmer founders will continue to cooperate structional services.”
Page Oklahoma Watch with investigators, who have now Rebecca Wilkinson, executive
A002 been probing the school for more director of the Statewide Virtual
Clip OKLAHOMA CITY — A state than six years. It is important to Charter School Board, told the OS-
resized investigation into Epic Charter note that no charges have ever been BI agent that instructional expen-
48% Schools has expanded to include filed. We are confident that the end ditures “must be a course supported
the school’s chief financial officer result of this investigation will be by a teacher of record, a recorded
and four current or former board as it has always been — no finding grade and included on the tran-
members, according to a search of wrongdoing.” script,” the affidavit states. In many
warrant filed in Oklahoma County Epic is the only virtual school cases, these weren’t. The agent cites
Wednesday. in Oklahoma that uses a learning a statute he says is evidence the
In the affidavit for the search fund — essentially a portion of school committed fraud.
warrant, an Oklahoma State Bu- each student’s state funding ($800 The agent in the affidavit accuses
reau of Investigation agent alleges to $1,000) that is set aside to be Chaney and Brock of concealing
Epic has been using state-appro- used on curriculum, a laptop rental, fraudulent expenditures “by dis-
priated funds to pay for students’ art supplies, workbooks and other guising the payments as instruc-
extracurricular expenses through items of the family’s choos- tional services” and falsify-
independent vendors but reported ing. Families also use the ing corporate records.
those expenditures to the state as funds on a variety of extra- This search warrant
“instructional services,” which the curricular activities, like is the second in as many
OSBI agent alleges is fraud. club sports, martial arts, months filed by OSBI. In
Named in the affidavit are Josh dancing or summer camps. July, the agents seized an
Brock, the school’s CFO, who Parents don’t actually Epic teacher’s computer
made the purchases, as well as receive the money direct- and cell phone in search of
Doug Scott, Travis Burkett, Mike ly but instead request a evidence related to alleged
Cantrell and Peter Regan, who purchase from Epic, which embezzlement of state
are being investigated for alleged- then pays the vendors funds and obtaining money
ly neglecting their duty as board directly. The school now has more under false pretenses, including
members to oversee the school’s than 1,200 vendors. through the use of “ghost students”
operations. According to the affidavit, Epic who didn’t actually receive instruc-
The search warrant was first re- in 2012 was advised by an attorney tion through the school.
ported by the Tulsa World. for its sponsoring school district at The school’s co-founders, Chaney
OSBI on Wednesday seized a the time, Graham-Dustin Public and Ben Harris, split profits of $10
laptop and bank statements from Schools, that using the learning million between 2013 and 2018,
OKC Storm Athletics, a Christian fund for extracurricular activities that affidavit states.
. sports vendor for home-school stu- when the students received no elec- OSBI’s investigation into Epic
dents, according to its website. Epic tive credit would violate state law. has been ongoing since 2013. When
pays vendors for student activities David Chaney, a businessman it’s complete, the agency is expected
through what Epic calls its “Learn- who co-founded the school, then to present its findings to Oklahoma
ing Fund.” opened a checking account for the County District Attorney’s Office for
The affidavit is the latest in an learning fund and transferred state possible filing of criminal charges.
th
th ongoing investigation into financial funds to it, which Brock used to In addition, the school is under-
th wrongdoing at the state’s largest pay for students’ extracurricular going an investigative audit by the
th virtual charter school. activities, the affidavit states. Those State Auditor & Inspector, and at
th Epic has denied any wrongdoing, purchases did not appear on Epic’s least two federal probes — by Fed-
th and on Wednesday afternoon issued general fund payment register and eral Bureau of Investigation and
th a statement saying, “Epic and its were reported to the state as “in- U.S. Department of Education.

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Stillwater NewsPress

State investigation of Epic expands to CFO, Board

By Jennifer Palmer gas company in Ada, is a cur-
Oklahoma Watch rent board member and Scott,
a Tulsa attorney, is chairman.
A state investigation into Burkett and Regan are no lon-
Epic Charter Schools has ex- ger on the board.
panded to include the school’s This search warrant is the
chief financial officer and four second in as many months
current or former board mem- filed by the OSBI. In July, the
bers, according to a search agents seized an Epic teach-
warrant filed in Oklahoma er’s computer and cell phone
County on Wednesday. in search of evidence related
In the affidavit for the to alleged embezzlement of
search warrant, an Oklahoma state funds and obtaining
State Bureau of Investigation money under false pretenses,
agent alleges Epic has been including through the use of
using state-appropriated funds “ghost students” who didn’t
to pay for students’ extra- WHITNEY BRYEN/OKLAHOMA WATCH actually receive instruction
curricular expenses through A sign is seen outside of 50 Penn Place in Oklahoma City, where Epic Charter Schools leases through the school.
independent vendors but re- 40,000 square feet for administrative use. The school’s co-founders,
ported those expenditures to Chaney and Ben Harris, split
the state as “instructional ser- doing, and on Wednesday the vendors directly. The tional services.” profits of $10 million between
vices,” which the OSBI agent afternoon issued a statement school now has more than Rebecca Wilkinson, execu- 2013 and 2018, that affidavit
alleges is fraud. saying, “Epic and its found- 1,200 vendors. tive director of the Statewide states.
Named in the affidavit are ers will continue to cooperate The learning fund is a big Virtual Charter School Board, The OSBI’s investigation
Josh Brock, the school’s CFO, with investigators, who have recruitment tool to attract told the OSBI agent instruc- into Epic has been ongoing
who made the purchases, as now been probing the school families, and families who tional expenditures “must be a since 2013. When it’s com-
well as Doug Scott, Travis for more than six years. It refer new students are re- course supported by a teacher plete, the agency is expected
Burkett, Mike Cantrell and is important to note that no warded with an additional de- of record, a recorded grade to present its findings to the
Peter Regan, who are being charges have ever been filed. posit into their student’s fund. and included on the tran- Oklahoma County district
investigated for allegedly ne- We are confident that the end According to the affidavit, script,” the affidavit states. attorney for possible filing of
glecting their duty as board result of this investigation will Epic in 2012 was advised In many cases, these weren’t. criminal charges.
members to oversee the be as it has always been – no by an attorney for its spon- The agent cites a statute he In addition, the school is
school’s operations. finding of wrongdoing.” soring school district at the says is evidence the school undergoing an investigative
The search warrant was Epic is the only virtual time, Graham-Dustin Public committed fraud. audit by the State Auditor &
first reported by the Tulsa school in Oklahoma that uses Schools, that using the learn- The agent in the affidavit Inspector, and at least two
World. a “learning fund’ – essentially ing fund for extracurricular accuses Chaney and Brock federal probes – by the Fed-
The OSBI on Wednesday a portion of each student’s activities when the students of concealing fraudulent ex- eral Bureau of Investigation
seized a laptop and bank state funding ($800 to $1,000) received no elective credit penditures “by disguising the and the U.S. Department of
statements from OKC Storm that is set aside to be used on would violate state law. payments as instructional ser- Education.
Athletics, a Christian sports curriculum, a laptop rental, David Chaney, a business- vices” and falsifying corporate The school is also facing a
vendor for home-school stu- art supplies, workbooks, and man who co-founded the records. potential lawsuit by several
dents, according to its website. other items of the family’s school, then opened a checking The OSBI agent reported at former teachers, who say they
Epic pays vendors for student choosing. Families also use account for the learning fund least two instances when Epic were pressured into withdraw-
activities through what Epic the funds on a variety of ex- and transferred state funds used vendors who were con- ing and re-enrolling students
calls its “Learning Fund.” tracurricular activities, like to it, which Brock used to pay victed felons. to manipulate enrollment to
The affidavit is the latest in club sports, martial arts, for students’ extracurricular The OSBI is also investigat- improve the school’s report
an ongoing investigation into dancing or summer camps. activities, the affidavit states. ing whether Burkett, Cantrell, card grade.
financial wrongdoing at the Parents don’t actually re- Those purchases did not ap- Regan and Scott neglected Oklahoma Watch is a a non-
state’s largest virtual charter ceive the money directly but pear on Epic’s general fund their duties as board mem- profit media organization that
school. instead request a purchase payment register and were re- bers in violation of the law. covers significant public policy
Epic has denied any wrong- from Epic, which then pays ported to the state as “instruc- Cantrell, head of an oil and issues facing the state.

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