FRAUD & SPECIAL
OFFICE OF THE CONTROLLER
REVIEW OF CHARTER SCHOOL
A Fraud Vulnerability Assessment
REVIEW OF CHARTER SCHOOL OVERSIGHT
Why the Controller’s Office Conducted the Review
At a time when Philadelphia charter schools are facing increased public scrutiny, including
criminal convictions of school officials for fraud and corruption, the Controller’s Office undertook
a review to assess the School District of Philadelphia’s (SDP) oversight of Philadelphia’s 63
charter schools and the vulnerability of taxpayer funds to fraud.
What the Controller’s Office Found
Our review revealed that the School District’s Charter School Office (CSO) is only providing
minimal oversight of charter schools except during the time leading up to the charter renewal. As
a result of this ineffective oversight and the lack of following the basic requirements of the School
Reform Commission (SRC), in excess of $290,000,000 a year paid by the SDP to charter schools,
is extremely vulnerable to fraud, waste and abuse. Action by the School District of Philadelphia,
the charter schools, and the legislature, where warranted, is necessary to decrease this vulnerability
and improve accountability of public funds.
Some of the review findings are listed below:
• Within the CSO, 51 out of 63, or 81%, of charter schools’ files were incomplete, missing items
such as the charter agreement itself, articles of incorporation or proof of insurance.
• The CSO was not performing its SRC mandated reporting requirements and was not actively
engaged in monitoring charter schools.
• The CSO had no record of nor had any communication with the charter schools board of
trustees, even though they are the ones legally entrusted with proper use of public funds.
As a result of the systematic breakdown of oversight, in a review of charter schools we found:
• One individual had been receiving in excess of $500,000 per year i