Waste of the Day: Education Fraud Sweeps Nation
Topline: Since 2019, school districts across 24 states and Puerto Rico have lost $225 million to fraud confirmed by the U.S. Department of Education inspector general’s semiannual report to Congress. No more than $67 million has been recovered.
Key facts: Open the Books and the State Financial Officers Foundation documented 74 instances of confirmed school fraud, averaging over $3 million each. There are far more that have gone unprosecuted or undetected.
Florida and Illinois schools each had the most instances of fraud with 11.
Indiana lost the most money — $44 million — due to inflated attendance numbers that increased state funding to two schools. The schools’ founder then allegedly sent the money to companies he owned. The schools closed in 2019, and four alleged conspirators were charged in 2024.
At Broward County Public Schools in Florida, information officer Anthony Hunter allegedly used district funds to buy $17 million worth of school supplies from a friend’s business, ignoring the competitive bidding process. In return, the friend hired Hunter and his son to work a security job and sold Hunter a house for $150,000 below market value, state prosecutors claim
Chicago Public Schools received $1 million of federal grants meant for Native American students, using an application that included more than 1,000 students of South Asian descent. The district was unable to verify how many students were actually in the program, and agreed to repay the money.
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Fraud arguably hits small school districts the hardest because they have fewer budgetary resources to begin with. When Janis Bucknor, former head of Community Preparatory Academy in California, admitted to stealing $3 million from the school over five years, it amounted to one-third of all the school’s state and federal funding.
Bucknor spent $220,600 of the money on Disney vacations and also funded her internet shopping and private school tuition for her kids. She was sentenced to three years of home detention and ordered to repay the money.
Summary: The government loses hundreds of billions of dollars to fraud annually, but redirecting money away from children's education is especially egregious.
The #WasteOfTheDay is brought to you by the forensic auditors at OpenTheBooks.com
