The Department of Justice has filed a federal complaint accusing Seth Andrew, 42, a former White House adviser to then-President Barack Obama, of stealing more than $200,000 from a network of charter schools.
The Daily Wire reported Andrew served under Obama as an adviser to the secretary of education, and later as a senior adviser in the White House Office of Educational Technology. He’s married to CBS News anchor Lana Zak.
The DOJ said the case against Andrew alleges wire fraud, money laundering and making false statements to a financial institute.
He was arrested this week.
Manhattan U.S. Attorney Audrey Strauss said, “As alleged, Seth Andrew abused his position as a founder of a charter school network to steal from the very same schools he helped create. Andrew is not only alleged to have stolen the schools’ money but also to have used the stolen funds to obtain a savings on a mortgage for a multimillion-dollar Manhattan apartment.”
FBI Assistant Director William F. Sweeney Jr. explained Andrew allegedly locked in a low mortgage interest rate by stealing money from the schools and depositing it with a bank to obtain preferential treatment.
The government said Andrew helped create “School Network-1” in 2005 to run charter schools in New York. He left the organization in 2013 and took a job in the U.S. Department of Education, later advising the White House.
But he was being paid by the network through 2017.
The charges allege after he formally severed ties with the network, he in 2019 closed out escrow accounts the network was required to maintain, taking checks for $71,881.23 and $70,642.98.
He then opened a business account in another bank, depositing both checks on different days.
He portrayed at the time he “was a ‘Key Executive with Control of’ School Network-1 Charter School, which was a lie,” the government charged.
At that time, the new bank was offering as a promotion a lower mortgage interest rate for those who deposited certain amounts in the bank.
Adding the “stolen funds” to his own money, he deposited $1,007,716 in the bank, obtaining a half-point interest rate reduction on the $1,776,000 mortgage he got to buy a $2,368,000 home, the government said.
Later, the government said, he closed a third escrow account, taking $75,481.10, putting that money in a third bank, and he moved the first two checks into a certificate of deposit that gave him $2,093.52 in interest, and put it all in a new account under the name of a civic organization he now runs.
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