Forensic audit to probe possible embezzlement at Blackfoot charters

BLACKFOOT — The Idaho Public Charter School Commission will pay an auditing firm $200 an hour to investigate the possible embezzlement of public funds at two Blackfoot charter schools.

Eide Bailly LLP will search for “misuse or misappropriation of assets and cash” at Bingham Academy and Blackfoot Charter Community Learning Center, according to an agreement obtained by Idaho Education News.

The probe will examine:

  • “Embezzlement, commingling of funds between the two schools, and use of school funds for other enterprises,” including an on-site daycare at Blackfoot.
  • “Overall operating finances” at both schools from July 1, 2017 through Jan. 31.
  • “Modular classroom expenses” at both schools from Aug. 1, 2014 through Jan. 31.

Blackfoot and Bingham each receive state funding based on average daily attendance. The schools together serve about 750 students, with budgets totaling around $4.3 million.

Fred Ball, the head administrator at both schools, did not immediately respond to a request for comment about the forensic audit.

The commission has been investigating both of Ball’s schools since December, over allegations of questionable internal controls and financial practices. Commission director Tamara Baysinger spent three days at the schools in February, interviewing trustees and examining documents.

She concluded the schools lacked “strong internal controls,” which contributed to their “overall financial distress.”

Idaho Education News also began investigating expenditures at Bingham and Blackfoot in December and found financial records to be missing or unavailable, especially reimbursement records to Ball.

EdNews found multiple unexplained checks to Ball, including a $22,099.37 payout for “modulars and other expenses.” Ball said he resold two modulars that he purchased from a Utah college to Blackfoot for the “spectacularly low price” of $16,000 or “what he had into them.” The college told EdNews it has has no record of a purchase with Ball — despite a “thorough search.” Instead, college officials produced records of selling at least one modular directly to Blackfoot.

When asked about the college’s findings, Ball told EdNews that he purchased two other units from the college. While these modulars were “not too expensive,” moving them was, Ball said. He recalled paying $6,000 to transport each of these other units to Idaho, but he has not provided receipts or documentation to EdNews to vouch for moving costs.

EdNews has requested the financial records of more than seven modulars at the schools. Ball’s attorney told EdNews in a letter that the schools have no such records.

EdNews also found bank statements revealing large transactions between the two schools. Blackfoot gave Bingham $70,000 via two separate checks in October 2018 and electronically transferred $5,000 in January 2018.

Forensic audits of public schools are very rare and range greatly in depth and cost. Costs beyond $20,000 for services at the Blackfoot schools will be paid on an as-requested basis from the commission, the agreement stipulates.

The commission will receive bi-weekly updates during the audit and a comprehensive report when it concludes.

Idaho State Board of Education Executive Director Matt Freeman signed the contract between the commission and Eide Bailly, on March 15.

The contract is valid until Sept. 30.

 

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