Bala Cynwyd School's Founder Charged In $6.5M Fraud
The FBI says Dorothy June Hairston Brown defrauded three charter schools, and misused money from Main Line Academy, between 2007 and 2011.
A Haverford woman was charged Tuesday with defrauding three charter schools she founded, costing them $6.5 million.
The indictment from the U.S. Attorney's office accused Dorothy June Hairston Brown, 75, of committing the crimes between 2007 and 2011. She also allegedly misused funds from Main Line Academy, a Bala Cynwyd school serving students with disabilities or developmental delays.
Along with Brown, four colleagues are charged with conspiring with Brown to obstruct justice, according to the indictment: Joan Woods Chalker, 74, of Springfield; Michael A. Slade, Jr., 31, of Philadelphia; Courteney L. Knight, 64, of King of Prussia; and Anthony Smoot, 49, of New Castle, Delaware.
Together, Brown and her colleagues are charged with 62 counts of conspiracy to obstruct justice, wire fraud (50 counts), witness tampering, obstruction of justice and aiding and abetting.
Brown is charged with defrauding Agora Cyber Charter School, founded in 2005, along with Philadelphia schools Planet Abacus Charter School and Laboratory Charter School of Communication and Language, which she founded in 2007 and 1997, respectively. The allegedly misspent money would have originated from taxpayers.
After federal grand jury subpoenas for records were served in 2008, Brown allegedly fabricated management contracts, falsified documents and forged signatures to make it appear as though the boards of the charter schools had met and authorized contracts with Brown's private management companies, Cynwyd and AcademicQuest. In some instances, names Brown listed as members of the school boards never actually served on the boards or attended meetings, the indictment alleges.
The indictment also alleges that Brown allowed her great-nephew, Michael Slade, to spend more than $40,000 on a truck for personal use from funds belonging to Main Line Academy. Slade was later named Acting CEO of another school Brown founded.
Among the alleged fraudulent payments are:
- $5.6 million paid to Cynwyd, Brown's private management company, from Agora
- $700,000 paid to AcademicQuest, another one of Brown's companies, from Planet Abacus
- $37,000 paid from a Laboratory account to an employee Brown hired to work for Cynwyd
- $160,000 in unauthorized payments paid to Brown and others from an Agora account
On Feb. 10, 2012, the FBI served a grand jury subpoena on AcademicQuest, and in April, Brown allegedly engaged in witness tampering, attempting to persuade a witness not to inform law enforcement of forged signatures on Planet Abacus documents.
"The charges of wire fraud, obstruction of justice, and witness tampering each carry a maximum possible sentence of 20 years in prison. The charges of conspiracy each carry a maximum possible sentence of five years in prison. If convicted, Brown, Chalker, Slade, Knight, and Smoot all face substantial terms of imprisonment and significant fines and other financial penalties," a U.S. Attorney's office press release states.
The 66-page indictment is attached to this article.