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Analysis Finds About $225 Million in K-12 Education Fraud Over Six Years

Ordered repayments total roughly $67 million, which the report’s authors say bolsters calls for tougher federal enforcement or a return of oversight to state and local officials.

CHICAGO, IL - JULY 2: Teacher Arlene Lebowitz assists a student in her third-grade class during summer school July 2, 2003 in Chicago, Illinois. A record number of students are expected at summer school due to a strong showing for a new voluntary program for mid-tier students and strict application of non-ITBS (Iowa Tests of Basic Skills) test promotion standards. (Photo by Tim Boyle/Getty Images)
PEMBROKE PINES, FLORIDA - APRIL 19: School buses are shown parked at a depot on April 19, 2023 in Pembroke Pines, Florida. The Florida Board of Education today approved banning discussion in the classroom of sexual orientation and gender identity for all grades through 12th grade, an expansion of what critics call the “Don’t Say Gay” law. (Photo by Joe Raedle/Getty Images)
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Overview

  • A coalition led by the State Financial Officers Foundation and Open the Books released the analysis in early July 2026 after reviewing Department of Education OIG semiannual reports from Oct. 2019 through March 2026.
  • The report aggregates nearly 90 alleged and confirmed cases totaling roughly $225 million that include embezzlement, inflated enrollment, fake invoices, bid‑rigging and kickbacks across 24 states and Puerto Rico.
  • The largest schemes cited include two now-closed Indiana online charter schools that allegedly received about $44 million by inflating enrollment and a Puerto Rico tutoring company that billed roughly $24 million for services not provided.
  • Several high‑profile prosecutions and convictions are noted in the dataset, including guilty verdicts for Brian Busby and Anthony Hutchison, Jorge Armando Contreras’s 2024 sentence and Janis Bucknor’s 2020 plea and restitution order.
  • The report highlights uneven federal oversight because only three of the 20 largest federally funded districts appear in OIG records, notes that about $67 million was ordered repaid but actual recoveries are unclear, and says the findings could drive policy changes at federal and state levels.