Former Obama White House advisor Seth Andrew arrested, accused of stealing from charter school he founded
A former advisor in the Obama White House has been arrested on charges of scheming to steal $218,005 from a charter school network he founded, federal authorities said. Seth Andrew, who also worked in the Education Department, is due to appear in Manhattan federal court, where a complaint says he used funds from Democracy Prep Public Schools to get a favorable home mortgage interest rate. The husband of CBS News anchor Lana Zak is charged with wire fraud, money laundering and making false statements to a financial institution, according to the U.S. Attorney’s Office for the Southern District of New York.
Seth Andrew, who served as an education advisor in the Obama White House, was arrested Tuesday morning on charges of scheming to steal $218,005 from a public charter school network that he founded, federal authorities said. Andrew, 42, was busted in New York City, where he and his wife, CBS News anchor Lana Zak, have a residence valued at more than $2 million. The founder of Democracy Prep Public Schools is accused of using more than half of the allegedly stolen money from that network to maintain a bank account minimum that gave him a more favorable interest rate for a mortgage on his and Zak’s Manhattan residence. Zak was not charged in the case.
Prosecutors said Andrew in 2019 — more than two years after severing ties with Democracy Prep — looted a series of escrow accounts he had previously set up for individual schools within Democracy Prep’s network, and then used their funds to open a business account in the name of one of the schools at a bank. A surveillance photo from a bank, which was included in a criminal complaint, show Andrew at that bank, where he was closing one of the schools’ escrow account there in October 2019. Andrew is seen in that photo wearing a yellow hat, which an FBI agent noted in the complaint “is essentially Andrew’s ‘calling card,’” as it signifies a connection to Democracy Prep “and his leadership of it.” Andrew is charged with wire fraud, money laundering and making false statements to a financial institution, according to the U.S. Attorney’s Office for the Southern District of New York, which is prosecuting the case.
At an appearance in U.S. District Court in Manhattan, a judge ordered Andrew released today on a $500,000 personal recognizance bond, which will have three co-signers. As a condition of that bond, both Andrew and Zak must surrender their passports, and Andrew’s travel was restricted to New York City, several counties north of the city, Long Island, and Vermont. Andrew next is due in court on May 27. Zak, who has three children with Andrew, did not immediately respond to a request for comment.
https://www.cnbc.com/2021/04/27/former-obama-white-house-advisor-seth-andrew-arrested-in-charter-school-theft.html
https://www.justice.gov/usao-sdny/pr/former-white-house-adviser-arrested-stealing-218000-charter-schools-he-founded