Once-Revered Educator Looted Stellar Charter Academy She Created, Audit Says

Sue Roche, the once-highly respected educator who founded the Oxford Preparatory Academy and transformed it into the most academically successful school in San Bernardino County and among the strongest scholastic performers in the state, was overtaken by greed and used secondary entities she created to provide educational-related materials and services and administrative assistance to the academy to personally profit and launder those proceeds, according to a recently released audit done at the request of San Bernardino County Superintendent of Schools Ted Alejandre.
The characterization of Roche and her action contained in the audit is misleading and inaccurate, Roche’s attorney this week told the Sentinel. He said the entity performing the audit has a bias against charter schools. The Chino Unified School District, which triggered the audit by backing out of its sponsorship of the Oxford Preparatory Academy after sponsoring its creation nearly seven years ago and sustaining it since then, he said, is acting out of spite because the academic performance of students at Oxford has overshadowed that of students elsewhere in the district.
The Fiscal Crisis & Management Team, an adjunct to the California Department of Education, delivered the 45-page audit summary and report last week, concluding Roche’s action may have crossed the line into criminality, while recommending that state and local education, fiscal and prosecutorial entities be apprised of the situation.
The audit states Alejandre should “Notify the governing board of Oxford Preparatory Academy charter school, the governing board of the Chino Valley Unified School District, the State Controller, the Superintendent of Public Instruction, and the local district attorney that fraud, misappropriation of assets or other illegal activities may have occurred.”
The development is the latest chapter in the rise and fall of Roche, who obtained noteworthy success while functioning as a school administrator within the state’s traditional public school system and then moved to the absolute forefront of the alternative education trend that has manifested as a consequence of California’s indulgence of a charter school system utilizing public funds to allow specialized campuses using intensified, specialized or unconventional teaching methods and modalities.
Roche had been the principal at Rhodes Elementary School, the highest-performing school in the Chino Valley Unified School District in the early 2000s.
With the support of Chino Valley Unified School District Superintendent Wayne Joseph, the district board in 2010 agreed to gamble over $3 million of the district’s revenue in having the district sponsor the establishment of Oxford Preparatory Academy, with Roche at the helm. Initially, both the district and Oxford’s advocates considered housing the charter school at the former Los Serranos Elementary School site in Chino Hills, but eventually settled on converting El Rancho Elementary School, located at the corner of C Street and Oaks Avenue in Chino, into the Oxford grounds. The academy was to be devoted to innovative and specialized approaches to the education of students from kindergarten to the 8th grade, using an even more intensified application of Roche’s already proven formula that relied on heavy parental involvement and steady doses of academic focus in the classroom.
The gamble on Oxford Preparatory Academy paid off, as students at the school performed spectacularly on academic achievement tests administered by the state. In 2011, students at Oxford Preparatory Academy collectively outperformed their counterparts at every other elementary and junior high school in San Bernardino County.
For three years running, Oxford had the highest score of any school in the county on California’s Standard Testing And Reporting exams, in 2011, 2012 and 2013. Known by the acronym STAR, the tests provide an academic performance rating or index, known as API, for second through 11th graders in every class, and at every school and district in the state. The tests measured students’ progress toward achieving California’s state-adopted academic content standards in English–language arts, mathematics, science, and history/social science. The results were used, until 2014, for student and school accountability purposes. Oxford had an Academic Performance Index (API) score of 958 in 2011 and improved to 972 in 2012.
Enthusiasm for the Oxford undertaking was so high, that the number of student applicants to attend the school routinely outran the number of desks and classroom space for them by as much as 600 per year, requiring that the district hold a lottery as a means of granting admission to it. Even more significantly, Joseph had to take the extraordinary step of forging a memorandum of understanding between the district and Oxford Preparatory, preventing the academy from poaching the district’s highest performing teachers. That memorandum of understanding prohibited district teachers from taking a leave of absence from the district to teach at the charter school. The charter school was also tasked with the responsibility of providing special education services.
In 2011, the school board unanimously extended Oxford’s charter for five years, from 2012-13 through 2016-17.
In the meantime, Roche expanded the Oxford model, convincing the Capistrano Unified School District to sponsor another campus, the Oxford Preparatory Academy in Mission Viejo. Roche transferred Jason Watts, who had been the principal at Oxford Preparatory Academy in Chino to Mission Viejo, where he served as the Mission Viejo’s inaugural principal/chancellor.
At the Mission Viejo campus, students rang up an impressive 993 academic performance score on the 1,000-point maximum index during the first year the school was open.
A year ago, it would have appeared unthinkable that the Chino Valley Unified School District would not renew the academy’s charter for 2017-18 and the four school years beyond that with the time to do so approaching, as Oxford was an exquisite feather in the district’s cap.
But Roche had taken action by that time which tarnished her reputation and threatened the very existence of the academic gem she had polished to near perfection.
Roche withdrew from the position of executive director of Oxford Preparatory’s corporate entity and promoted Barbara Black to that position, while assuming an undefined administrative role in the academy that would in time come to be occupied not by herself but a for-profit entity, Edlighten Learning Solutions, in which she is the central figure and prime mover.
Upon Roche’s direction, Black had Oxford Charter Academy enter into a contractual arrangement that would have paid Edlighten $5.3 million to, essentially, employ Roche as the school’s contract administrator and operations director.
With the date for the school board’s determination with regard to renewing Oxford’s charter approaching last spring, Joseph learned of what Roche had done. Roche was, Joseph became convinced, seeking to exploit the non-profit Oxford Preparatory Academy and line her own pockets. He publicly accused Roche of creating and then engaging in a financial conflict of interest which would have the effect, he implied, of shortchanging Oxford Preparatory’s students while enriching herself. Roche had engaged in “arrogance, overreach and greed” in the administration of the academy which victimized Oxford’s students and parents, Joseph told the school board, while employing “machinations” by which she fired dedicated educational professionals or otherwise advanced herself. Roche, the superintendent said, was cynically manipulating the academy’s reliance on consultants to cash in. In compliance with Joseph’s recommendation, the school board declined to renew Oxford’s charter.
Initially, Oxford’s internal board asserted the school district’s action was unjustified but then regrouped and terminated its relationship with Roche and Elighten in May. It then appealed the district’s decision to the county school board, but that body declined to take any action, maintaining that by changing its management structure, the proposal that Chino Unified had rejected no longer existed. Oxford then turned to the State Department of Education, seeking to get a charter from it. In the meantime, Alejandre had made his request for the audit.
With the completion of the audit and the language it contains, it would appear unlikely that Oxford, despite its enviable academic track record, will be able to continue in San Bernardino County.
The audit catalogs how Roche created a system that involved Yorba Linda-based Edlighten and another entity, the Nevada corporation Educational Excellence, in dodging accountability through what was characterized as a “daisy chain” of payments between for-profit companies which employed her family, friends and associates. Roche purposefully hid or obscured financial transactions and operations in such a way that the auditors, not to mention Chino Valley Unified officials and even Oxford’s own in-house employees could not easily track them, according to the audit report. Ultimately, public school funding was diverted to bank accounts controlled by Roche and her associates, according to the audit. Oxford Preparatory, Edlighten and Educational Excellence employed two of Roche’s children, her cousin and several of her friends.
“Interviews indicate that following the petition renewal in 2012, the founder created a complex structure of charter management corporations that exercised significant influence over transactions and contracts between these entities, and secured considerable financial benefit through contracts that charged management service fees up to 10 percent, funneling charter school dollars from Oxford Preparatory Academy schools,” the audit report states, such that Oxford was charged “for services that already existed.”
Oxford Preparatory paid Edlighten $4.2 million in management fees between January 2013 and June 2016, according to the audit. Those numbers were steadily growing, from $821,490 in 2013, $1.2 million in 2014 and $1.3 million in 2015. Edlighten was on track to take in more than $2 million from the academy in 2016, when Edlighten’s contract with Oxford was terminated in May. Because of that, Edlighten received payments of just $834,522 in 2016.
Roche’s actions was both deliberate and calculated, the auditor’s opined, and they said there was “sufficient evidence that affiliated and/or related party organizations were intentionally created to divert and launder funds from Oxford Preparatory Academy.”
In response to the audit and its eroding public position, Oxford Preparatory Academy has greatly altered the blanket denials of wrongdoing it issued nearly eight months ago.
“We concur that the Fiscal Crisis & Management Team findings are of great concern,” Oxford Preparatory’s board chairman, Michael Delgado said in a message to parents of students at the school. “The current Oxford Preparatory Academy board and administration had no knowledge of Mrs. Roche’s inappropriate expenditures and had zero authority over the way in which Edlighten spent its funds. News of this apparent mismanagement of funds – specifically the Fiscal Crisis & Management Team’s allegations of money laundering by [Edlighten] – is shocking and disappointing to all of us. The current board and administration were kept in the dark about the activities during Mrs. Roche’s tenure and outraged by the revelations in the Fiscal Crisis & Management Team report. Oxford Preparatory Academy has already implemented numerous changes to address many of the issues that have been raised.”
Delgado said the matter involving Roche should not detract from Oxford’s reputation for academic excellence or curtail its mission to offer a top-notch education to students. “In the classroom, our results speak for themselves,” Delgado said.
Marc Greenberg, Sue Roche’s attorney, told the Sentinel the audit and its report were flawed in that the auditors based their conclusions on an erroneous pretext, essentially that the academy was connected to Edlighten and Educational Excellence.
“The Fiscal Crisis & Management Team assumed those entities are connected and all of their conclusions, which are slanderous and libelous, flow from that.”
In a letter to the Fiscal Crisis & Management Team dated November 27, Greenberg emphasized this point, writing, “The Fiscal Crisis & Management Team built its entire report upon a core misstatement of fact. According to The Fiscal Crisis & Management Team ‘Oxford Preparatory Academy Services and Edlighten Learning Systems are nonprofit public benefit corporations that support Oxford Preparatory Academy and meet the definition provided in the district’s memorandum of understanding with Oxford Preparatory Academy as affiliates.’ [Report, page 34.] Nearly all of the Fiscal Crisis & Management Team’s findings flow from this core, false, conclusion that Edlighten and Oxford Preparatory Academy are ‘affiliated organizations.’ The support for the Fiscal Crisis & Management Team’s conclusion is a paragraph from the memorandum of understanding, partially quoted in the report. But the Fiscal Crisis & Management Team chose to leave out the most important sentence from quote. The language the Fiscal Crisis & Management Team chose to leave out completely refutes the Fiscal Crisis & Management Team’s finding.”
Greenberg then reproduces the Fiscal Crisis & Management Team’s quote from the memorandum of understanding on page 11 and again on page 34: “Whereas, ‘Affiliated Organizations,’ for the purpose of this agreement, shall mean the Oxford Preparatory Academy nonprofit public benefit corporation, all charter schools operated by the Oxford Preparatory Academy nonprofit public benefit corporation, and any foundations that may later be formed by Oxford Preparatory Academy to support the nonprofit organization and/or one or more of its charter schools . . .”
In his letter Greenberg then points out that “The rest of the words in the same paragraph state that: ‘It shall not include parent organizations so long as Oxford Preparatory Academy does not control the board of such organizations.’ As a matter of agreement signed by Wayne Joseph on behalf of the School District, the same people that requested the Fiscal Crisis & Management Team Report, Edlighten is not an “affiliated organization.” In signing the memorandum of understanding on January 19, 2012, Mr. Joseph warranted that ‘such execution shall bind the designated entity to the terms of this Agreement.’ Edlighten and its counsel, Procopio, relied on Mr. Joseph to stand by the agreement he drafted and signed on behalf of the district. The district and Mr. Joseph expressly excluded Edlighten as being treated as an affiliated organization and yet the Fiscal Crisis & Management Team treated them as if they were an affiliated organization.”
Furthermore, according to Greenberg, “It is not credible that the selective quotation from the memorandum of understanding was ‘accidental.’ While the Fiscal Crisis & Management Team appears to, unfortunately, be an advocate against charter schools, that does not give it license to misquote the memorandum of understanding between the district and Oxford Preparatory Academy. This ‘misquote’ is the foundation for the entire report. This type of misrepresentation of the facts would be punishable if this were a court of law.”
Greenberg’s letter states, “While the report may fit with the narrative the school district has about charters schools, it is not accurate and at times is intentionally misleading and defamatory.”
Greenberg said the audit and its report was a “hatchet job meant to attack the charter school, which was performing much better than the district’s schools. This was an embarrassment to Wayne Joseph, who would have done better to use Oxford Preparatory Academy as inspiration and a model of what can be done in an academic setting.”

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