founder of a national charter school network, which once served as a white House advisor to the president Barack Obama He has pleaded guilty to a charge of stealing $218,000 from the network in order to obtain a low interest rate on a multimillion-dollar Manhattan apartment.
Democracy Prep founder Seth Andrew, 42, filed a plea for wire fraud in Manhattan federal court, admitting that he transferred money from a network of charter schools to other bank accounts without authorization in 2019.
An emotional Andrew told Judge John P. Cronan, ‘I’m really sorry for what I’ve done.’ ‘What I did was wrong and I deeply regret what I did.’
Seth Andrew, 42, stole $218,000 from a charter school network he founded to get low interest rates on a multimillion-dollar Manhattan apartment.
Officials said Andrew closed three of the school’s bank accounts and deposited them into fraudulent accounts he had opened. This image shows Andrew inside a bank when he was closing a third account in November 2019
The cash was used to buy a penthouse apartment at 370 Central Park West in Manhattan
The three-bedroom apartment has ‘incredible entertaining space, with a flexible layout and priceless vistas’, according to a realtor listing
$2 million apartment UWS . Located right across the street from Central Park at
This is the apartment at 370 Central Park West owned by Seth Andrew and his wife Lana Zak
Hardwood floors run throughout the apartment with ample space for tables
One of the apartment’s three bedrooms with great views of Central Park
The kitchen is narrow like many others in New York, despite the price of the apartment
Some bedrooms are ideal for a study or home office.
“And, as I stand before you today, I am deeply sorry for the impact it has had on schools, alumni and my own family,” he said.
Andrew was also charged last April with money laundering and making false statements to a bank. He will face up to 20 years in prison in his scheduled April 14 sentence, but will get a much shorter amount of time.
In 2005, Andrew was the founder of Democracy Prep, when it started in New York City.
The school, which mostly teaches low-income people of color, helped raise test scores for economically challenged children in Harlem. It then expanded throughout the United States.
In the spring of 2013, Andrew left his role as a superintendent in its school network and as a senior adviser in the Office of Educational Technology at the White House to work at the US Department of Education. The work lasted till November 2016.
When Andrew (left) stole money from schools, he and his wife Lana Zak (right) were able to obtain a mortgage of $1,776,000 with a low interest rate of 2.5 percent.
In court papers, officials said Andrew stole $218,000 from the schools he helped build and then used the money to mortgage a $2 million Manhattan apartment he bought with his spouse by his bank. To get the best interest rate offered on
Prosecutors said that in 2019, two years after breaking up with Democracy Prep, Andrew robbed escrow accounts for the network’s schools so that he and his wife could buy a $2.37 million apartment located on the valued Central Park West in Manhattan.
Prosecutors said the stolen money helped Andrew qualify for a $1.78 million mortgage with a 2.5% interest rate, a reduction of half a point and the largest his bank allowed. Andrew’s wife, CBS News anchor, Lana Zak, was not charged with wrongdoing.
On March 28, 2019, officials said Andrew locked two of the school’s three escrow accounts, which were to be accessed only when the school was dissolved.
For the previously closed account, Democracy Prep Charter School received a bank check in the amount of $71,881.23 payable. The second bank check was for an amount of $70,642.98 and was also payable to Democracy Prep Harlem.
In court papers, officials said Andrew tried to show that the money he took from schools (file image) came from a civic organization he controls
The same day, Andrew entered Manhattan Bank and opened a business bank account under the name Democracy Prep.
In order to open that account, Andrew told a bank employee that he was “a key executive with control” of the Charter School Network, which was a “liar”. He deposited a $71,881.23 check in the account but not another.
On April 2, 2019, Andrew uses an ATM machine in Baltimore, Maryland to deposit a second check. Officials said it appeared they waited to submit the ‘Check-2 as it was payable to Democracy Prep Harlem’ and not Democracy Prep Charter School.
Prosecutors said he would not have been honored by the bank if he had tried to deposit a second check when opening a ‘fraudulent account’.
On October 17, 2019, Andrew closed the third escrow account and received a check payable to Democracy Prep Endurance in the amount of $75,481.10, officials said.
One of the escrow accounts Andrew closed belonged to Democracy Prep Harlem (file image) and amounted to $70,642.98.
Four days later, he is said to have deposited the check into an account he had opened in a different bank.
About a month later, Andrew received a check for a total of $144,473.29, which allegedly constituted money stolen from Democracy Prep’s two escrow accounts.
He then deposited those funds into the same account where $75,481.10 was deposited.
Within the same week Andrew deposited the funds in the account ‘into the certificate of deposit’.
“The certificate of deposit matured on May 20, 2020, earning Andrew $2,083.52 in interest,” the statement said.
The statement continued to say that he ‘then transferred funds from certificates of deposit – including money stolen from escrow accounts – to a bank account held in the name of a special civilian organization that Andrew currently controls, thereby The money is concealed in association with ‘Democracy Prep’ and depositing the stolen money into an account under his ‘absolute control’.
Two years after breaking up with Democracy Prep, Andrew robbed accounts for the network’s schools so that he and his wife could buy an apartment for $2.37 million. The stolen money helped Andrew qualify for a $1.78 million mortgage with a 2.5% interest rate, a reduction of half a point.
Andrew admitted that he tried to show that the money he took from the schools came from a civic organization he controls as it moved from the schools’ network accounts to his personal accounts and later from March to October of 2019 Transfers money to the nonprofit’s account. ,
He said that he told the bank employees that they had the right to transfer the Democracy Prep Fund when they did not do so.
In a release, US Attorney Damian Williams said, “Former White House adviser Andrew admitted today that he planned to steal from the same schools he helped build.”
He added: ‘Andrew is now facing time in federal prison for abusing his position and robbing those who promised to help.’
Defense attorneys Tim Doherty and Edward Kim said in a statement that Andrew has “worked tirelessly for more than two decades to expand educational, democratic and technological opportunities for disadvantaged communities around the world.”
Andrew founded Democracy Prep in 2005, joining the Department of Education in 2013, becoming a senior adviser in Obama’s White House Office of Educational Technology.
‘Seth’s life has always been inspired by a civic mission and he deeply regrets his past mistakes. His lawyer, Edward Kim, said in a statement that he has courageously accepted his responsibility. ‘With the help and support of his family and loved ones, Seth looks forward to deepening his commitment to service and innovation in the next chapter of his life.
‘For more than two decades, Seth Andrew has worked tirelessly to expand educational, democratic and technological opportunities for disadvantaged communities around the world. He deeply regrets his past mistakes. He has accepted his responsibility with courage.
Andrew has agreed to pay the full $218,000 to the charter school network.
Democracy Prep now operates 24 schools with more than 7,000 students in New York, New Jersey, Louisiana, Nevada, and Texas.
It has called Andrew’s unauthorized evacuation a “deep betrayal”.
His sentence is set for April 14, when he faces up to 20 years in prison, although prosecutors and defense lawyers agreed in a written plea that a prison sentence of 21 to 27 months was appropriate.
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