Oklahoma Virtual Charter Censured in State Audit

According to Education Week, “An embattled virtual charter school that has grown to become Oklahoma's largest public school used a ‘remarkably complex’ infrastructure to divert tens of millions of taxpayer dollars into a for-profit business controlled by three men, says state auditor Cindy Byrd.

“A Republican with more than two decades of auditing experience, Byrd said the problems uncovered in the investigative audit of Epic Charter Schools and the company that manages it, Epic Youth Services, were among the worst she has seen.

“She released a scathing 120-page audit of the school's activities and finances from 2015 to 2020 that shows it funneled about $80 million into a ‘learning fund’ managed by the school's founders, Ben Harris and David Chaney, that has never been audited. Another $45.9 million went directly into the for-profit management company controlled by Harris, Chaney, and the school's chief financial officer, Josh Brock. ‘This arrangement presents an inherent conflict of interest,’ she said.

“Among the audit's other findings: The school recently spent $3 million over three months on advertising to attract new students; Epic Youth Services used $203,000 from the student-learning fund to help with startup expenses for expanding its operations into California; Harris and Chaney used Oklahoma school personnel and funds for its California operations; and they pledged credit from Epic bank accounts as collateral to secure loans to run their for-profit venture in California.

“An Epic spokeswoman described Byrd's press conference as 'political theatrics' and said school officials dispute many of the audit's findings.

“The P-12 school has enjoyed explosive growth since it was founded in 2011 and now has an enrollment of about 46,000 students.”