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Epic Investigative Audit is Epic
Epic Investigative Audit is Epic
Doug Brown
Tuesday, October 06, 2020

Investigative Audit of Epic Charter Schools Raises Concerns for Every Oklahoma Taxpayer, State Auditor Says

Epic Charter Schools logo graphic

OKLAHOMA CITY - State Auditor & Inspector Cindy Byrd released today Part One of a two-part Investigative Audit of Epic Charter Schools and related entities.

The special audit was ordered by Governor Kevin Stitt in July 2019.

The more than 100-page report, for audit years FY2015-FY2020, found that Epic Charter Schools designed an administrative system inconsistent with the Oklahoma Charter School Act and its charter agreements.

There are 21 findings from the year-long audit, including:

  • Epic spent almost $3 million on advertising in three months to recruit new students
  • Epic has paid almost $80 million into the Student Learning Fund which is managed by founders Ben Harris and David Chaney 
  • The Student Learning Fund has never been independently audited and the release of its financial records to the State Auditor is currently in litigation 
  • The State of California has confirmed Epic Charter Schools' Charter Management Organization, Epic Youth Services (EYS), used $203,000 from the Student Learning Fund - money dedicated for educating Oklahoma children - to help with start-up expenses for Epic-California (Epic-CA) 
  • Epic's founders used Oklahoma school personnel to operate its California counterpart including $210,000 to develop Epic-CA and these funds were only repaid after the State Auditor discovered the transfer and made inquiries into the expenditure 
  • Harris and Chaney pledged credit from Epic Charter Schools (Oklahoma) bank accounts as collateral to obtain a half-million dollar loan to run their for-profit venture in California 
  • Epic Charter Schools underreported administrative costs above the statutory five percent cap last year and was required to repay the state a half-million dollars 
  • During the audit period, SAI calculates that Epic exceeded the administrative cost cap by $8.9 million 
  • The audit identified $6 million in fund transfers between Epic school districts without board approval 
  • One Epic district loaned another Epic district $3.3 million without board approval