Public corruption diverted funds
The defendants in the A3 charter school fraud case. Leaders Sean McManus and Jason Schrock are pictured in the top row. Photo credit: Screen shot, 10News.com

The co-founder of a charter school network that engaged in a “systematic public corruption scheme” to siphon away tens of millions of dollars was sentenced Friday to four years in prison.

Jason Schrock, 46, was charged along with A3 Education CEO and President Sean McManus and nine other defendants for running what prosecutors have called “one of the nation’s largest fraud schemes targeting taxpayer dollars intended for primary education.”

Prosecutors say McManus and Schrock directed subordinates to open up 19 “A3 charter schools” in San Diego County and elsewhere across the state, and collected state funds by claiming that students were enrolled in programs run by the schools.

The San Diego County District Attorney’s Office said that the men paid for student information and used it to enroll children in summer school programs at their online campuses.

Prosecutors say some parents were unaware their children were enrolled in a charter school at all.

The defendants then took measures to inflate the amount of money the state paid the charter schools by falsifying documentation, which included backdating documents to indicate that students were enrolled in the charter schools for longer than they were.

They also switched students between different A3 schools to increase funding per student or per school beyond legal limits, prosecutors said.

The schools earned as much as $4,000 per student despite not providing full educational services, with the defendants transferring $100 million of A3 funds to private companies they controlled, according to the DA’s office.

Along with Schrock’s state prison sentence, San Diego Superior Court Judge Frederick Link ordered that he and McManus, 48, pay a combined $37.5 million in fines.

The DA’s Office says that the fines imposed through the case “will be earmarked and exclusively dedicated to programs that directly serve the needs of kindergarten through 12th grade students in San Diego County.”

Schrock and McManus, who were charged in a 235-page grand jury indictment in 2019, pleaded guilty earlier this year to conspiracy charges. The DA’s Office says their nine co-defendants also have pleaded guilty.

McManus is set for sentencing in February.

In addition to the fines, $14 million in restitution has been ordered paid to the school-aged victims. The money will be held in trust and administered by the San Diego Foundation.

More than $90 million in additional restitution will go to the state. A court-appointed receiver was ordered to hold additional funds of approximately $70 million to be paid out at a future date. 

In all, more than $220 million in stolen funds were recovered, of which $150 million was the subject of the hearing before Link.

District Attorney Summer Stephan noted that “a great deal” of the stolen funds in the case “will be funneled back into supporting students.”

“These funds come at a perfect time to help them recover and succeed,” she said.

– City News Service

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