Back in the old days, it used to be that an FBI raid on a private company meant something.
When file-sharing companies Napster and Megaupload threatened copyrights in the recorded music business, for example, the FBI moved in and put them out of business.
In 2013, the FBI raided the offices of Liberty Reserve, an online payment processor that was popular with cybercriminals. Within weeks, the company was shut down for good.
When truck stop chain Pilot Flying J was accused by the FBI of defrauding customers millions of dollars over a rebate program, truckers across the country expressed “surprise and disgust” over the company’s actions. The reputation of the company’s CEO, Jimmy Haslam, took a hit. Meanwhile, customers started looking to take their business elsewhere before the company ended up paying $85 million in settlement money.
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In other words, once FBI agents swarmed into your offices and started taking computers, files and personnel records out by the boxful, it meant your company was in serious trouble. And it usually meant that customers, vendors, and anyone else involved in your business started thinking twice about giving you anymore of their money.
At least until your company was cleared of wrongdoing or made restitution for its crimes.
But that was then. And it wasn’t in Chicago.
Here, a federal raid on a company doesn't seem to mean much anymore, especially if that firm is a politically connected charter school operator ready to take millions of taxpayer dollars to stay in business.
Case in point: Concept Schools. The charter company, which is based in Des Plaines and operates schools across the Midwest—including four in Illinois—is currently under a federal investigation. Last month, FBI agents carried out raids at 19 Concept locations in Illinois, Indiana and Ohio as part of an “ongoing white-collar crime matter”.
The company was founded by Turkish immigrants and has ties to Turkish-American groups, as well as a long list of political connections in Illinois and Chicago. Concept officials have hosted Illinois House Speaker Michael Madigan and other state lawmakers on trips to Turkey in recent years.
As well, the Chicago Sun-Times reports Concept had planned to spend more than $528,000 of public funding to rent space owned by of Fellowship Missionary Baptist Church, whose pastor, Charles Jenkins, gave the invocation at Mayor Rahm Emanuel’s 2011 inauguration and was part of the mayor’s transition team.
That’s because Concept, which operates schools on the city’s Far North Side and McKinley Park and Austin neighborhoods, is looking to expand and collect some more of the public funding that’s being doled out by the bucket load by the Chicago Board of Education.
In its most recent budget, Chicago Public Schools earmarked a $62 million increase to charter school budgets and a $67 million decrease in neighborhood school budgets. CPS says the reason for the funding shift is due to declining student enrollment in neighborhood schools, and the money has to follow where the students go.
Concept is looking to open two new schools on the city’s South Side, one of which is in the Chatham neighborhood. Despite the FBI raids and ongoing investigation, the Board of Education seemingly had no problem approving the expansion, despite previously placing a planned Concept location on hold in light of the ongoing investigations.
All of this expansion activity for a privately-run charter school operator is taking place despite the fact that at least three neighborhood schools—Ryder Math and Science, Mahalia Jackson Elementary and Ft. Dearborn Elementary—are within eight or nine blocks of the new Concept location.
Concept has a long history of controversy, and along with mega-charter operator UNO is now one of two highly publicized scandals involving financial malfeasance by a charter school operator in Chicago.
Apparently, however, not even a search warrant and an FBI raid into wrongdoing is enough to place a charter schools expansion plans in Chicago in jeopardy.
It kind of makes you long for the old days when a federal investigation used to mean something.
