Yost’s Conflicts of Interest and Mismanagement Necessitate Special Audit by Independent Firm
COLUMBUS — State Rep. and former assistant attorney general Kristin Boggs today issued a letter calling for state Auditor Dave Yost to recuse himself from all current and future matters related to the Educational Classroom of Tomorrow (ECOT) and for a special audit to be conducted into the charter school.
“Auditor Yost has consistently failed to lead an effective investigation or audit into any matters involving ECOT,” said Boggs. “In 2014 Auditor Yost received information from an ECOT school employee regarding fraudulent school enrollment, but he then allowed ECOT to limit the scope of its own investigation. ECOT leaders openly bragged about the fact that they convinced Auditor Yost to forgo requesting student login hours in response to the 2014 complaint. As a result of his complicity, ECOT continued to be overpaid millions of taxpayer dollars.”
Over the last several years ECOT has been paid more than $100 million dollars per year by the state of Ohio. Since 2010, ECOT leadership has contributed more than $1 million in political contributions to Ohio Republican organizations and officials. Yost’s campaign and transition fund have received nearly $20,000 in contributions from William Lager, ECOT’s founder, and ECOT-associated entities. Lager is one of Yost’s largest donors.
“No one with a reasonable mind would conclude that ECOT’s founder gave more than $1 million back to Republican leaders out of pure charity,” said Boggs. “They did it to advance their business interests. This is the slimiest form of politics. You have a few individuals that have become multimillionaires at the expense of Ohio taxpayers. These individuals then kick back more than $1 million in political contributions, so the legislature, the attorney general’s office, and auditor’s office will look the other way, while ECOT owners continue to get rich off the state.
“I believe that Ohio taxpayers deserve to have full confidence in a special audit regarding all matters related to ECOT. The massive amount of political contributions doled out by ECOT and Auditor Yost’s record of failing to aggressively investigate ECOT casts a shadow on the propriety of any matter in which ECOT is being examined by his office. Auditor Yost repeatedly missed the warning signs on ECOT student attendance fraud. He was either asleep at the wheel, or he allowed ECOT’s political capital to change how he viewed an entity that bilked Ohio taxpayers out of $60 million. Either way, he needs to step aside and we need a special audit performed by an independent firm.”
The State Board of Education last month voted to force ECOT to repay $60 million that the for-profit e-charter school overbilled Ohio taxpayers during the last school year. ECOT is appealing that decision to the Ohio Supreme Court.
Editor’s Note: Please find below the text of the letter delivered to Yost’s office today:
Dear Auditor Yost,
I am writing to request that you commission a special audit, to be performed by an independent firm, for the purpose of determining whether the Electronic Classroom of Tomorrow (ECOT) illegally used public money. According to news reports, your office is currently conducting an investigation into the matter of whether ECOT improperly used taxpayer funds for advertising. However, to ensure that this important investigation is free from conflicts of interest and the appearance of bias, you must immediately recuse yourself from any current and future matters related to ECOT.
Media reports have revealed that your office has long been aware that ECOT’s common practice was to bill the State for students it could not properly document were enrolled. As far back as 2001, State Auditor Jim Petro’s investigation of ECOT revealed that it was overpaid $1.7 million for over-counting enrolled students. Then, in 2014 an ECOT whistleblower came forward with allegations that ECOT was, again, fraudulently over-counting its enrolled students.
Instead of properly following up on these allegations, you acquiesced under ECOT’s insistence to limit the scope of your office’s examination, characterized as an “agreed upon procedures engagement.” In fact, Rick Teeters, ECOT superintendent, has publicly stated that he convinced you not to request student log-in durations pursuant to the your office’s engagement. Yet inasmuch as you knew of ECOT may have been over-counting its students, you inexplicably continued to leave e-schools out of your charter school attendance audits and made no efforts to ascertain the truth about ECOT overbilling the State. As a result of your complicity, ECOT continued to be overpaid millions of taxpayer dollars.
Under your leadership, the auditor’s office has failed to act appropriately against ECOT when the available evidence should have triggered aggressive action. Although you now claim that you expressed private concerns to the legislature regarding online charter schools, publicly you’ve recognized ECOT as being worthy of “Ohio Auditor of State Award with Distinction.” In giving the award, you personally proclaimed that ECOT was deserving of a recognition for complying with all the laws and having best practices in place.
Further, according to records with the Ohio Secretary of State, you have accepted nearly $20,000 in political contributions from ECOT leadership since 2010. While this sum is only a fraction of the $1.2 million ECOT leadership has contributed in total to Ohio Republican organizations and officials, the massive amount of political contributions doled out by ECOT casts a shadow on the propriety of any investigation overseen by your office.
All told, your statements and actions regarding ECOT call into question your effectiveness and impartiality on matters involving ECOT. At best, you ignored clear signs of impropriety and mismanagement; at worst, you allowed ECOT’s political contributions to you and other Republican leaders to influence your official actions in the wake of a massive fraud.
Ohio taxpayers deserve to have full confidence in a special audit regarding all matters related to ECOT. For this reason, to ensure that this important investigation is free from conflicts of interest and the appearance of bias, you must immediately recuse yourself and commission a special audit with an independent firm.
State Representative Kristin Boggs
House District 18