Saturday, January 6, 2018

NM: Another Charter Swindle

Scot Glasrud was a big charter operator. Now he's headed for prison.

The former head of Southwest Learning Centers, a chain of three prominent New Mexico charter schools, has been convicted of stealing $2 million dollars from the charters in the course of a fifteen-year fraud.

Local station KRQE laid out back in 2014 some of the ways that Glasrud was using the charter school biz to make himself a rich man. He was paid a salary of $210K-- more than any superintendent in the state save the head of Albuquerque schools. And he perfected the charter art of self-dealing. The school paid Glasrud's company over $800K to lease two planes for flight instruction. The school also leased property from a Glasrud company.

It should be noted that New Mexico's charter school law allows only non-profit schools. But Glasrud's end run around that law is a typical move in non-profit states. New Mexico has seen plenty of profit-making non-profit carter schools-- often with the encouragement of their state education head. All this despite the fact that New Mexico charter schools actually spend more taxpayer dollars per student than public school, achieving completely unremarkable results.

In other words, Glasrud could have continued to profit hugely from his mediocre non-profit charter schools, and it would have been a completely legal charter school scam. Remember-- a non-profit charter school is just a for-profit with money-laundering in place. But apparently he got greedy.

So he overcharged himself for lease costs. And he set up fake companies to do fake construction and pocketed the tax dollars he received from the state. The business manager hired by the charter company went to company barbecue at Glasrud's house and was reportedly stunned by what he saw--  guest house, a dozen collector automobiles-- and started digging. He found a variety of irregularities-- my personal favorite was that Glasrud paid a high-end Las Vegas restaurant sommelier for work as a "substitute teacher." The business manager went to the FBI and helped them investigate, leading to Glasrud's eventual conviction.

Please note that it took federal investigators to convict this guy. The state of New Mexico was perfectly happy with his work.

This is the charter industry in New Me3xico. It's perfectly okay to operate a profit-making non-profit charter school because that doesn't break any laws. To cross into actual illegal activity requires some really spectacular scammage, and even then, someone has to make the feds notice. It would be nice if this story were unique, or just a New Mexico thing. But it's not, thanks to super-loose regulation and oversight of charter schools all across the nation.

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