The Washington Post

Former D.C. charter board CFO promoted private companies that allegedly paid him

As the D.C. Public Charter School Board’s chief financial officer, Jeremy L. Williams was responsible for monitoring charter schools’ business practices and ensuring their compliance with rules meant to prevent financial mismanagement.

Instead, he allegedly received $150,000 to help three former managers of Options Public Charter School evade those rules and take millions of taxpayer dollars for themselves, according to a pending civil lawsuit.

Williams and the other defendants in that lawsuit have denied doing anything illegal.

But e-mail messages The Washington Post obtained through a Freedom of Information Act request show that Williams used his official capacity with the charter board to help the former Options leaders promote two for-profit businesses that allegedly served as vehicles for diverting millions of dollars in taxpayer funds meant for students.

“Thanks for assisting with the presentation yesterday,” David Cranford, one of the Options officials, wrote in March 2013, referring to a meeting Williams hosted for business managers from the city’s charter schools. On the agenda was a chance for the Options managers to pitch their company’s Medicaid billing services, which they argued could help schools recoup some of their special-education costs.

“Your involvement definitely opened up a lot of opportunities to work with other charters,” Cranford wrote.

“No problem chief!” Williams replied, according to e-mail records. “More opportunities looming. For certain.”

Williams’s attorney, Troy W. Poole, declined to comment. Williams did not respond to a request for comment.

Options, a school of about 400 at-risk teens, was thrust into turmoil in October when the D.C. attorney general sued, alleging that the school’s three former managers had concocted a contracting scheme to divert more than $3 million to their two for-profit businesses, Exceptional Education Management Corp. (EEMC) and Exceptional Education Services (EES).

By the time the lawsuit was filed, the three managers had left Options to work full time at those companies. Also named as defendants were local television news personality J.C. Hayward, who allegedly signed key contracts and other documents in her role as chair of the school’s board of directors, and Williams, who allegedly used his position at the charter board to aid the scheme.

Williams “regularly forwarded confidential, internal” e-mails to the three Options leaders, according to the complaint, and allegedly ensured that EEMC’s largest contract with Options would not be reviewed by the board’s staff. Court documents say the two companies paid Williams and a Virginia corporation he owns, Gemini Financial Strategists, $150,000 during a seven-month period in 2013, including his final six months as a charter board employee.

Attorneys for the five defendants have said their clients did nothing wrong, citing other charter schools that contract with management companies. D.C. law allows charter schools to enter into business agreements with for-profit enterprises, including “related parties” with whom school leaders have close ties.

Besides the pending civil case, there is a parallel criminal investigation in which federal officials are examining whether the former Options leaders committed Medicaid fraud by, among other things, exaggerating the needs of the school’s disabled students and paying students with gift cards to ride school buses, according to several people familiar with the criminal investigation.

Williams is a subject of the criminal investigation, according to court documents.

Federal prosecutors “have indicated that a possible Indictment for Jeremy Williams” and other defendants in the civil case is “highly likely within the very near future,” Williams’s attorney wrote to the court in May, requesting that a judge temporarily halt proceedings in the civil lawsuit until the criminal investigation is over.

Williams’s e-mails from a 10-day period in March 2013 and an 18-day period in August show that on several occasions, he forwarded messages and financial documents to himself at outside e-mail addresses, including addresses associated with EEMC and Gemini Financial Strategists.

Many of those messages were related to Options, but others were related to Booker T. Washington, another D.C. charter school that had a contract with EEMC.

Some of the messages concerned Community Academy Public Charter School, a school that is the subject of another civil lawsuit alleging misuse of taxpayer dollars; Williams has not been linked to that case.

The e-mails also show that in March 2013, Williams invited Donna Montgomery — who was then both the chief executive of Options and the head of EEMC and EES — to a weekly telephone meeting on Tuesday mornings at 10 a.m. He sent a similar standing invitation to Andrea Shorter, an accountant who provided bookkeeping services for Options.

Charter schools are required to submit all contracts over $25,000 to the charter board, which examines them for conflicts of interest or other problems. Although Williams received a copy of Options’ contract with EEMC in March, the contract was not transmitted to board members until August, seven months after it had been signed.

On Aug. 20, the business manager at Ideal Public Charter School e-mailed Williams asking for advice on whom to hire for Medicaid billing assistance. Williams suggested EEMC, according to e-mail records.

The next day, Williams resigned from the charter board to join EEMC. He acknowledged in his resignation letter that he had been considering the job for the better part of the year and that the double allegiance created “certain conflicts.”

“It has been a decision that has eaten at me for over seven months. One that I should have made months ago,” he wrote in an e-mail to board members. “My indecisiveness has resulted in certain conflicts that could have been pacified had I been more selfish. There was simply too much to be done at PCSB for me to do so and I didn’t want to vacate my responsibilities and the PCSB team prematurely.”

Williams wrote that he believed EEMC could fill an important niche in the District by providing charter schools with the help and technical assistance that they need to improve and that the charter board was not able to provide.

“Many school leaders simply do not trust PCSB, particularly the minority leaders. They feel that PCSB is out to close their schools and not offer any assistance before doing so,” Williams wrote. “EEMC offers me the opportunity to work with some of these schools directly.”

In a separate e-mail to the charter board’s executive director, Scott Pearson, Williams wrote that he was “anxiously awaiting the opportunity for you to meet with the EEMC team to learn more about their mission and hopes for the public charter school sector.”

“You will find that transparency will be a non-issue with this vendor,” Williams wrote.

Pearson, who had not previously known about Williams’s affiliation with EEMC, was clearly concerned about the implications of that relationship, according to the e-mails.

“I need to understand this better to clarify if there were any conflicts,” Pearson wrote to charter board members and senior leaders on the day Williams resigned, according to an e-mail obtained by The Washington Post. Months later, Pearson said publicly that Williams had acted as a “double agent,” inappropriately working on behalf of the private companies while employed at the charter board.

A PCSB spokeswoman declined to comment on the lawsuit. “We cannot comment on matters in active litigation,” Tomeika Bowden said.

After Williams’s resignation, the board updated its employee manual to explicitly prohibit staff members from taking an outside job with a charter school without written permission from the board’s executive director.

The manual also prohibited employees from taking any outside job that would create a real or perceived conflict of interest.

Emma Brown writes about national education and about people with a stake in schools, including teachers, parents and kids.



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