Accountability Charter Schools Education Industry Failure Fraud Privatization St. Louis

St. Louis: Charter Founder Admits $2.4 Million Fraud

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The founder and headmaster of a charter school in St. Louis admitted to skimming $2.4 million in public funding by inflating enrollment.

This is to be expected when private companies obtain public money without accountability or transparency.

The former head of a failed charter school has pleaded guilty to federal wire fraud charges in a scheme that cost taxpayers $2.4 million.

Michael Malone, who founded St. Louis College Prep, inflated attendance numbers for years as a way to collect more government funding for the struggling school.

“What the former headmaster did through his deception, repeatedly over many years, was take advantage of the Missouri taxpayers, while obtaining an unfair advantage over the St. Louis Public Schools and other area charter schools,” U.S. Attorney for the Eastern District of Missouri Jeff Jensen said in a news release. “This was not a mistake. Evidence proved Michael Malone’s actions were intentional and, unfortunately he got away with it for years.”

Malone, 44, opened the school in 2011 and served as headmaster until November 2018, when he resigned after an internal review and an investigation by Missouri Auditor Nicole Galloway showed he was cooking the books. The school closed in 2019.

As a charter school, St. Louis College Prep was funded through the state Department of Elementary and Secondary Education. The funding is calculated through daily attendance records, and Malone routinely jacked up those numbers to increase funding. At times, those numbers exceeded even the total enrollment by as much as 124 percent…

The fraud meant money that rightfully would have gone to St. Louis Public Schools went to the charter school to educate phantom students, authorities say.

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