Legal Review: D.C. Needs to Stop Enrollment Fraud, But How?

By Washington D.C. Criminal Defense Attorney Shawn Sukumar with Price Benowitz, LLP.

An annual audit revealed that enrollment fraud is increasingly common at a Washington, D.C. high school.

At the Duke Ellington School of the Arts, an acclaimed public school, public residency records point to fraud. According to Hanseul Kang, State Superintendent of Education, the agency that oversees both public schools and charter schools in the District, specific concerns were discovered in public records that were connected to some students’ parents regarding whether they were residents of the District.

Tuition at the school is more than $12,000 for non-residents. By misstating their residence, families can avoid the tuition fee.

Residency fraud has been a persistent problem for many years. It is common for Maryland and Virginia students to attend D.C. public and charter schools, which are funded by D.C. taxpayers.

This practice is illegal and takes away seats from students who live in D.C.. Eligibility is done annually every Spring, with residency proven by utility bills or signed leases.

It is easy to game the system and fake residency, or to use a friend or relative’s address who live in the city. It is also hard to prove residency when there are complicated custody arrangements or situations involving undocumented immigrants.

But public officials have not done anything to fix the problems; in some cases, they are also the perpetrators. Enforcement is not uniform, and it could take years for the District to recover money owed to them for the waived tuition.

In the past five years, 182 fraud cases have been reported to the AG’s office, but only 39 of these cases have been resolved in a settlement or enforcement.

Out of the six current cases in Superior Court, four involve a school employee. Of those cases that were settled, only 20% of the money has been repaid from the families ordered to pay because of court proceedings.

In addition to unpaid tuition fees, those found guilty of fraud can be charged with a hefty fine from a violation of the False Claims Act. The total due in this time to the District is $1.5 million, and some of that money is being repaid in installments.

Fraud is not always intentional either. Sometimes it just involves simplifying morning drop-off for parents commuting into the city.

“Clear policies need to be established in school residency requirements, which obviously was not in place at Ellington,” said Shawn Sukumar, a fraud attorney at Price Benowitz LLP in Washington, DC. “Fraud exists only when there is intent on the part of the families to deceive the school. Each case needs to be investigated individually to see if fraud was perpetrated.”

The State Superintendent of Education’s office is responsible for monitoring enrollment at the schools and any fraud investigations in a system covering 92,000 students.

In 2017, 155 tips came in about residency fraud, according to the Office. It only employs one full-time investigator, and at the end of 2017 this employee was handling over 600 individual cases.

Until last year, fraud investigations of public schools were handled by a D.C. Public Schools investigator, and the Superintendent hired outside private investigators to handle charter school probes. That was not effective, so now both systems are investigated in-house.

This contrasts with Montgomery County, MD, where 52 employees work on residency investigations (its school district twice the size of D.C.’s), and Fairfax County, VA’s 15 employees.

It is unclear how nonresident families are identified, billed and tracked, or what happens if they miss a payment.

Superintendent Kang has vowed to make these policies more consistent regarding when payments are due, and how delinquent families are followed up with. She also confirmed last month that two more full-time investigators will be hired and that the mayor has allocated $300,000 in new funding covering these investigations in the new budget.

She also stated that her office is now confirming the residency of every Ellington student — 500 families are currently registered as residents of D.C.