Check out this article from yesterday's SB Sun. Corrupt officials in San Bernardino will not be able to protect Tad Honeycutt from the FBI. They do not mess around. What's funny is Honeycutt's lawyer says that "other" audits cleared him. What he doesn't say is that the other audit was done by HIS LAWFIRM!!! Also, Honeycutt says that the audit was thrown out of civil court. That is a blatant lie. A U.S. Bankruptcy Court judge in Riverside dismissed the bankruptcy petition against them only.
Have a nice time in prison Tad!!
Academy under fire
Audit: Millions misspent
Jeff Horwitz, Staff Writer
The FBI is investigating the 2004 collapse of Victorville-based California Charter Academy, which left thousands of students without schools and millions of public dollars unaccounted for.
A bureau spokeswoman confirmed the agency has seized financial records used to compile an April 2005 audit accusing CCA executives, staff and a slew of High Desert politicians of potential ethical and legal lapses.
Calling the financial records "our evidence," Sacramento-based FBI Special Agent Marcie Soligo declined to answer questions about what triggered the agency's interest in the charter-school group.
C. Steven Cox founded the academy in 1999, and it quickly grew to 60 campuses statewide and more than 10,000 students.
Financial irregularities involving a management company Cox created to run CCA and legal disputes between his school and state officials led to an audit commissioned by the state superintendent of public instruction. The audit found that more than $25 million in school funds were misspent.
As head of the management company, the audit says, Cox "had the opportunity to direct millions of dollars of CCA funds to benefit himself, his corporation, his family, and his friends and associates. He took advantage of that opportunity."
Millions of dollars of school funds were reportedly used to start private businesses, pay undeserved salaries and cover such personal spending as $20,000 on Disney-related art and services at the Disneyland Health Spa.
Hillary McLean, a spokeswoman for state Superintendent of Public Instruction Jack O'Connell, said FBI agents spoke with department staff as recently as last week. She said the agents appeared to be interested in charter-school financing and some of the auditors' concerns.
Hesperia Mayor Tad Honeycutt, who worked closely with Cox, is a recurring figure in the audit. As the one-time business-development director for the schools' private management firm, Honeycutt helped steer hundreds of thousands of dollars to outside businesses, was paid for work he never completed and frequently used his company credit card for "often quite significant" purchases that "did not appear related to educational purposes," the audit reports.
Honeycutt denied misusing school funds.
"That audit was full of speculation," he said. "I don't believe there was anything illegal taking place. If I did, I would have gone to law enforcement about it."
Honeycutt said he has nothing to fear from an investigation. Given the magnitude of CCA's failure, he said, "it would be appropriate for the FBI to do an investigation."
Dennis Wagner, a Riverside lawyer whose firm represents Cox in bankruptcy and civil litigation, dismissed the 107-page audit as a "press release" and said the allegations of malfeasance in the audit were the product of a smear campaign by Jack O'Connell.
Previous audits had cleared Cox, CCA and its management company of wrongdoing, Wagner said.
"Steven's private company buys some (Sea-Doos)," he said of a purchase on Honeycutt's credit card that the audit suggests was a flagrant misuse of money. "So what?"
Wagner said he was already aware of the FBI investigation because documents needed for Cox's civil litigation have been in bureau possession since January.
"If they're relying on the audit, they need to find a more reliable source of information," he said.
In addition to the FBI investigation, the San Bernardino County District Attorney's Public Integrity Unit is looking into the charter academy's failure. On Thursday, Deputy District Attorney Frank Vanella said his office had been in contact but was not working with federal investigators.
One thread an investigation might follow is the academy's ties to High
Desert political figures. In an audit section titled, "Some CCA Board Members May Have Had Legal and Ethical Conflicts of Interest," the audit asserts that many politicians had inappropriate financial relationships with CCA's management company at the same time they were supposed to be shepherding school finances.
Hesperia Unified School Board President Eric Swanson served on the governing boards of three CCA charter schools and received hundreds of thousands of dollars from CCA shortly after resigning from them, the audit reports. JoAnn Almond, a Victorville city councilwoman, served on all four boards when she sold her family rock business to CCA's management company, the audit says.
One of the best-known politicians mentioned in the audit is Bill Postmus, chairman of both the county's Board of Supervisors and the San Bernardino County Republican Party. The 1st District supervisor served on two school boards from 1999 to 2001, the audit says, and during that time accepted more than $25,000 in campaign contributions from Cox and CCA's management company.
The boards he and others sat on failed to provide even basic supervision of charter-school finances, the audit says. They even gave Cox's management company control of school bank accounts.
A call requesting comment from Postmus on Friday was returned by his chief of staff, Brad Mitzelfelt, who said Postmus does not believe the audit accused him of any wrongdoing. He noted that his boss resigned from the CCA board in 2001, well before CCA's failure.
"He felt the organization was running properly when he was on the board," Mitzelfelt said, adding that Postmus, too, suspected that Cox's detractors had warped the audit's findings.
"There were serious conflicts and abuses of power on the part of the (state) Board of Education and the superintendent's office in their dealings with CCA," Mitzelfelt said. "And those things should be looked at as thoroughly as CCA is being looked at."
Some of those affected by CCA's collapse said Friday that they were glad to hear its demise had triggered an investigation by federal law enforcement.
Retired firefighter Michael Dickinson, chief of the Public Safety Academy in San Bernardino that was once authorized by CCA, said problems with how CCA money was spent were apparent well before CCA's August 2004 collapse. He severed his school's ties with CCA six months earlier.
"They started using public money for private things," he said.
When his school broke off ties, Dickinson said, CCA and its management company repossessed most of his school's equipment, even taking students' desks. For as much as a year afterward, he said, he and three teachers worked without pay to keep the school open. Anyone who helped themselves to education money should be punished for it, Dickinson said.
"I think the students of California deserve it," he said. "If you . . . stand up and tell people you're going to educate your students, you've got to do it."
