Ex-White House adviser charged in $200K theft from schools

Larry Neumeister
Associated Press

New York – The founder of a national charter school network who once served as a White House adviser under President Barack Obama was arrested Tuesday on charges alleging he stole over $200,000 from the network and used it to get a better interest rate on a multimillion-dollar apartment.

Seth Andrew, founder of Democracy Prep, was arrested in Manhattan on wire fraud, money laundering and false statement charges.

Seth Andrew

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Attorney Michael Yaeger said Andrew, 42, will plead not guilty to the charges.

“We’re reviewing the papers that were just unsealed this morning,” Yaeger said in an email.

Andrew awaited an initial appearance in Manhattan federal court.

U.S. Attorney Audrey Strauss said in a release that Andrew stole $218,000 “from the very same schools he helped create.”

She said he then used the money to obtain a better interest rate on a mortgage for a $2.3 million Manhattan apartment.

Andrew was a founder of Democracy Prep when it started in New York City in 2005. It later expanded across the United States, flourishing after its methods helped raise test scores for economically challenged children in Harlem.

According to a criminal complaint, Andrew left his role as a superintendent in his schools network in the spring of 2013 and began working in the United States Department of Education and as a senior adviser in the Office of Educational Technology at the White House until November 2016.

In court papers, authorities said Andrew tried to make it appear that the money he took from the schools came from a civic organization he controls.

They said he used the money to qualify for a half–percent interest rate reduction – the largest his bank allowed – on his purchase with his spouse of a Manhattan residence in August 2019.

The couple obtained a $1,776,000 mortgage with an interest rate of 2.5%, the complaint said.

“Today Andrew himself is learning one of life’s most basic lessons – what doesn’t belong to you is not yours for the taking,” said William F. Sweeney Jr., head of New York’s FBI office.