Epic Charter School had spending irregularities, finance head testifies

OKLAHOMA CITY — When Janice Wynn came to work at Epic Charter School, it wasn’t long before she encountered issues that held her back, she testified Tuesday in Oklahoma County District Court.

Wynn joined Epic in February 2021 as vice superintendent of finance for virtual charter schools. Four months earlier, a scathing state audit had reported widespread mismanagement of taxpayer funds at Epic, but Wynn said she accepted the job believing it was “a challenge I could handle.”

But after only a few months, Wynn said he discovered that state-funded employees were helping manage the Learning Fund bank account, while they did not have access to the account records to ensure that its funds were deposited into the account. was being spent legally.

State-funded employees were also working on behalf of a charter school in California, he said, and Epic still has not been paid in full for their efforts.

“I don’t believe they were made whole, no,” Wynn said on the witness stand.

He testified that Epic co-founder Ben Harris admitted in a private meeting that money from a fund created for Oklahoma students was sent to the California school.

Epic charter school founder faces criminal fraud, embezzlement charges

Prosecutors called Wynn to testify Tuesday in a multi-day preliminary hearing against Harris and Epic’s other co-founder, David Cheney.

The attorney general’s office says a hearing began Monday to outline evidence that warrants criminal charges against Harris and Cheney. Oklahoma County Special Judge Jason Glidewell will decide after the hearing whether there is enough evidence to move the case forward to trial.

Harris and Cheney have been charged with fraud, nine counts of embezzlement, conspiracy to defraud the state, money laundering and other alleged crimes stemming from their leadership at Epic.

Prosecutors have focused on whether Harris and Cheney illegally sent Oklahoma taxpayer dollars to a California charter school and whether they unlawfully managed Epic’s learning funds.

The co-founders and their lawyers argued that the learning fund money belonged to a private company, not the state.

More: Are there too many virtual charter schools in Oklahoma? MPs doubt their success

Epic funnels taxpayer dollars into a learning fund account at a rate of $800 to $1,000 per student to help families pay for technology, learning materials and extracurricular activities.

Wynn said Harris and Cheney’s company, Epic Youth Services (EYS), owned the Learning Fund bank account and did not allow the school or the general public to view its records.

According to an affidavit from the Oklahoma State Bureau of Investigation, Harris, Cheney and their chief financial officer, Josh Brock, spent money from the account on personal expenses and political donations.

According to testimony, state-funded employees were helping students purchase items by taking money from private accounts

Even though the company claimed that account information was private, state-funded employees at Epic were integral in purchasing the items requested by students.

One of those employees, Chandler Winningham, testified Tuesday that the school also flouted state laws governing how students can use the money.

For example, Epic does not allow students to use their learning fund balances to purchase religious materials because it would be contrary to the Oklahoma Constitution, he said. Harris’s attorney, Joe White, doubted that blocking religious purchases would prove that the account was public.

Winningham said that once students left school, all items purchased through the learning fund were considered the property of Epic.

Wynn testified that she was concerned to see a private company relying on public school employees to manage the account.

“I was surprised because I expected them to be on the payroll for EYS,” she said.

The way the school calculated how much to pay EYS for the account also seemed irregular, he said, and Epic had to put millions more dollars into the company’s hands.

Epic and EYS had contractually agreed to use a metric called “per student count” that included all students enrolled at any time in the first quarter of the school year, regardless of the number of times they attended.

Public school funding and budgeting is typically based on average daily membership, which accounts for both student enrollment and attendance, Wynn said.

He said Epic’s unusual methodology counted 8,000 more students than the school’s average daily membership and multiplied the total by $1,000.

“There was a pretty clear difference between those two numbers, about an $8 million difference,” Wynn testified.

Epic severed ties with Harris, Chaney and their company in May 2021 and set up a school-controlled version of the Learning Fund.

According to the contract, a mutual termination agreement broke their relationship, which stipulates that “all payments received by EYS have been and will remain private funds”.

The company agreed in the contract to donate the remaining amount of the learning fund back to the school – a pledge which Wynn said EYS never fulfilled.

Epic estimates there should have been about $14 million left in the account, he said, but EYS has not returned any of the learning funds.

The case is now embroiled in civil litigation, in which the co-founders allege the school owed them money for unpaid services.

Wynn’s testimony is expected to resume Wednesday morning. The judge set a preliminary hearing to last until Friday.