Former Obama Adviser Pleads Guilty to Stealing Hundreds of Thousands from Americans
A former member of the Obama White House has pleaded guilty to stealing more than $200,000 from a network of charter schools he helped to found.
“Seth Andrew, a former White House adviser, admitted today to devising a scheme to steal from the very same schools he helped create. Andrew now faces time in federal prison for abusing his position and robbing those he promised to help,” U.S. Attorney Damian Williams said Friday, according to a Justice Department news release.
Andrew pleaded guilty to one count of wire fraud before United States District Judge John P. Cronan, in Manhattan federal court. He will be sentenced on April 14 and faces a maximum sentence of 20 years in prison.
Seth Andrew, who is a former Obama White House advisor, pleaded guilty on Friday to wire fraud after scamming over $218,000 from a charter school network that he founded to get the best interest rate on a mortgage for a $2 million Manhattan apartment, according to prosecutors.
— Mark Nantz (@BullseyeBanjo) January 15, 2022
In 2005, Andrew helped found “School Network-1,” a group of New York City charter schools. In 2013, he moved to the U.S. Department of Education and later to the Obama White House as a senior adviser in the Office of Educational Technology.
Although in January 2017 he ended his affiliation with School Network-1, in March 2019 Andrew withdrew money from escrow accounts the school network had been required to maintain — and which were supposed to be accessed only if the school dissolved.
He is accused of closing two escrow accounts that totaled just over $140,000, getting checks for the money that was in those accounts, then opening an account at another bank. The Justice Department said he misrepresented himself as “a ‘Key Executive with Control of’ School Network-1 Charter School and supported that misrepresentation with emails” sent to an employee of the bank.
Once that account opened, he deposited the two checks he had secured by closing the escrow accounts.
On October 17, 2019, he closed a third escrow account, received a check for over $75,000 and deposited that money into an account he opened at yet another bank.
In November 2019, Andrew is accused of putting all the money in one account, which he later rolled over into a certificate of deposit. He moved the certificate of deposit funds, after the certificate matured, into the account of an organization he controlled.
As part of his guilty plea, Andrew has said he will repay the funds to the Charter School Network.
Prosecutors said last year that Andrew used the money to get a lower interest rate on a mortgage when he bought a Manhattan apartment for $2 million, according to The New York Times.
“I am truly sorry for what I have done,” Andrew said in court Friday, according to Fox News.
“What I did was wrong, and I deeply regret my actions. And, as I stand before you today, I have tremendous remorse for the impact it has had on the schools, the alumni and my own family,” he continued.
The Times reported that in a statement on Friday, Democracy Prep, a charter school founded by Andrew, said: “We are glad that this sad chapter is over and thankful to the authorities for their hard work on this case.”
In a letter to parents, Natasha Trivers, the chief executive of Democracy Prep Public Schools, said the crime was at variance with the school’s values.
“His alleged actions are a profound betrayal of all that we stand for and to you and your children, the scholars and families that we serve,” Trivers wrote, according to the Times.
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