Former charter school star indicted in alleged $6 million fraud

Veteran educator Dorothy June Brown had a penchant for establishing charter schools in the Philadelphia area. And then stealing from them, according to the feds.

Brown, of Haverford, bilked $6 million from 2007 to April 2011 from three charter schools she founded, the U.S. Attorney's Office alleged in a 62-count indictment on Tuesday. The school's are: Agora Cyber Charter School based in Wayne; Planet Abacus Charter School in Tacony; and Laboratory Charter School of Communication and Languages, with locations in Overbrook, Northern Liberties and Wynnefield.

Brown, a former school district educator who once was honored by the Daily News for her service to education, was charged along with four other current or former charter-school executives: Joan Woods Chalker, 74, of Springfield; Brown's great-nephew Michael A. Slade Jr., 31, of Philadelphia; Courteney L. Knight, 64, of King of Prussia; and Anthony Smoot, 49, of New Castle, Del.

"Dr. Brown denies all charges in the indictment and intends to vigorously defend herself against these unfounded charges," Brown's attorney, Gregory P. Miller, said in a statement released late Tuesday.

The federal government begs to differ.

"The investigation reveals that Dr. Brown used her influence, her intimate knowledge of the school system, its policies and regulations to set up a complicated web of companies and organizations designed to conceal her role and payments to herself and to her companies and to her co-conspirators," said Special Agent-in-Charge George C. Venizelos, of the FBI's Philadelphia office.

"The bottom line is running a charter school is not a license to steal," he said.

The government alleges that Brown lined her pockets when her businesses, Cynwyd and AcademicQuest, defrauded the three charter schools. For example, she falsified a contract between Cynwyd and Agora that resulted in $5.6 million in fraudulent payments, according to the indictment. The school's board of trustees never approved the contract, and "Cynwyd did little more than collect millions of dollars in 'management fees' from Agora while providing little or no services to Agora," the indictment said.

With the help of Chalker, chief executive of Planet Abacus, Brown fabricated contracts and other documents resulting in fraudulent payments by Planet Abacus to AcademicQuest totaling $700,000, the indictment said.

To pull off the scam, Brown and her co-conspirator falsified documents such as board meeting minutes, board resolutions and financial records, U.S. Attorney Zane David Meminger said.

The School Reform Commission was scheduled to review renewal applications for Planet Abacus and Laboratory Charter on Friday, but the school district said Tuesday that those have been put on hold. The district said in a news release that it asked former Assistant U.S. Attorney Michael Schwartz to assist the district "in conducting an investigation into the allegations and advice on any future course of action that may be warranted."