OKLAHOMA CITY — A former Epic Charter School official charged in a major embezzlement and racketeering case said Friday he agreed to testify against the school’s co-founders in exchange for no prison time.
Joshua Aaron Brock, 42, who served as Epic’s chief financial officer, said he would receive 15 years of probation if he pleads guilty and cooperates with the prosecution. He would be a convicted felon under the agreement.
Brock’s testimony began Friday against Benjamin Scott Harris, 48, and David Lee Chaney, 44, in a preliminary hearing in Oklahoma County District Court.
Harris, Chaney and Brock have been charged with racketeering, multiple counts of embezzlement, conspiracy to defraud the state, acquiring unlawful proceeds and money laundering, among other accusations.
Harris and Chaney have denied misusing taxpayer funds from the virtual charter school, which during the COVID-19 pandemic became the largest public school system in the state.
Harris and Chaney founded Epic, which opened in 2011, and owned the management company that made millions of dollars from operating the school.
Brock was the chief financial officer for both the company and school.
“That would not be consistent with what I would call internal controls,” Brock said of his dual role.
Epic severed its relationship with the co-founders and Brock in May 2021.
Eight witnesses, many of them officials involved at Epic and investigators, spent hours testifying this week as prosecutors from the state Attorney General’s Office laid out their case to special judge Jason Glidewell.
The judge will decide after the hearing concludes whether the evidence is sufficient to advance Harris and Chaney toward trial. It is unclear whether testimony will finish Friday, as originally scheduled, or if the hearing will have to continue.
Although Epic’s governing board was the highest authority at the school, the co-founders acted as the top decision makers through their influence over daily operations and by leveraging personal connections with the board members, said Jimmy Harmon, the chief of the attorney general’s criminal division.
“Mr. Harris and Mr. Chaney controlled the school, while maybe not on paper, but they controlled it in actuality,” Harmon said during the hearing. “They picked the board members. They told the board members what to do.”
The school board agreed to pay the co-founders’ company, Epic Youth Services (EYS), 10% of the school’s annual revenue.
EYS also was responsible for the school’s Learning Fund account, which held millions of dollars intended to help Epic students pay for instructional materials, technology and extracurricular activities.
Bank records show the co-founders and Brock moved money from the Learning Fund to their company’s operating account 52 times, said officials from the Oklahoma State Auditor and Inspector’s Office.
The total amount of those transfers was $3.2 million, auditors said.
They also made personal purchases and political donations with Learning Fund money, auditors and the Oklahoma State Bureau of Investigation found.
“It was concerning because these funds in the student Learning Fund were designated for the students for educational purposes,” auditor Salesha Wilken said on the stand Wednesday. “They were presented that way throughout the process until we questioned the accuracy of these transactions.
“These are public monies. These were for the kids.”
Harris and Chaney’s attorneys argued the Learning Fund money was private because the account belonged to their company, not the school.
However, the co-founders never reported these funds as income in their tax returns, and purchases from the account used the school’s tax-exempt status, investigators said.
Chaney, his wife and his assistants spent $817,000 in personal purchases with credit cards that were charged against the Learning Fund, records show. Chaney reimbursed some of the funds from his personal bank account, but $377,000 was never repaid, auditors said.
Investigators also reported Harris, Chaney and Brock spent money intended for Oklahoma students on a charter school in California that their company also managed.
Jeanise Wynn, the school’s current head of finance, said Epic has never been fully repaid for the work its employees in Oklahoma did for the California school.
Wynn said on Tuesday she was concerned to see state-funded school employees managing the Learning Fund, a job EYS was being paid to do. Epic paid millions of dollars in payroll for these employees to purchase items on students’ behalf from the Learning Fund, but no one outside of the co-founders’ company was allowed access to the account’s records, Wynn said.
Some of the concerns first surfaced in a 2020 investigative audit report from the Oklahoma State Auditor and Inspector’s Office. The OSBI later helped auditors obtain bank records of the Learning Fund and the co-founders’ company, which they alleged had uncovered more wrongdoing.
Defense attorneys spent hours questioning auditors and the OSBI’s lead agent in the case.
Harris’ attorney, Joe White, said the co-founders deny the auditors’ allegations that public school funds were misspent.
“We’re going to dispute it all the way to trial,” White said.
This article is from nonprofit news outlet Oklahoma Voice.