LAUSD audit finds $2.7M fraud at Canoga charter

New Academy Canoga Park Elementary School.
New Academy Canoga Park Elementary School.

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Los Angeles Unified School District auditors accused administrators of a Canoga Park charter school of gross mismanagement and fraud that could total nearly $3 million.

The LA Unified audit says the board members of New Academy Canoga Park Elementary School failed to effectively monitor the school’s finances. At least $1.6 million can’t be accounted for, and there are unanswered questions about $1.1 million the school spent with the OK of the former principal.

L.A. Unified auditors concluded that minimal oversight of New Academy Canoga Park Elementary’s finances by L.A. Unified and campus administrators allowed the person or persons who committed the fraud to feel they could get away with it.

L.A. Unified Superintendent Ramon Cortines requested a public hearing to issue the school a Notice of Violations, a first step toward stripping the school of its charter to operate.

“The misappropriated and unaccounted public funds of $2.7 million are egregious. As a result of this mismanagement, NACP students have been inexcusably deprived of funds that were designated solely to further their education,” Cortines said in a written statement.

The 450-student school has improved test scores significantly in the last few years. New Economics for Women — an L.A. housing nonprofit founded by Chicana activists 26 years ago — built and promoted the charter school.

The school referred questions to Maggie Cervantez, a member of the school's board who's also Executive Director of New Economics for Women. She was not available for comment about the fraud allegations.

According to the district, the audit found public funds totaling more than $1 million were deposited into the former principal's personal investment account. Thousands of dollars in public funds were also unaccounted for, with no evidence they were ever deposited in the school's accounts, the audit found.

KPCC wire services contributed to this report.